The City of Busselton has lost its bid for a Qantas pilot training academy to be based at the Busselton Margaret River Airport.
In a statement last week, Qantas announced that Mackay, Queensland, would be the preferred location for the second Qantas Group Pilot Academy site.
The announcement followed a competitive process to select two locations from a shortlist of nine regional cities, with Toowoomba in southern Queensland announced as the first location for the academy last September.
City of Busselton director of community and commercial services Naomi Searle said the announcement of the second academy was disappointing, but was not unexpected.
"The City understands that the Queensland State Government had a significant incentive package on offer," she said.
In its bid, the WA Government would have provided $1.7 million to help support the city to secure a deal and also promised to complete a new terminal at the airport.
Construction on a new terminal was halted after the state government withheld Royalties for Regions funding to finish the airport upgrade because an airline had not yet committed flying into Busselton.
Regional development minister Alannah MacTiernan said the focus should now be on making sure a financial package was in place so that an airline would want to come to Busselton.
"What we are now seeing with the aircraft being proposed and the package that has been put forward by Jetstar will not need a new airport," she said.
"It will be quite a different arrangement because there will need to be a lot more funding to attract the airline, there will be a lot more risk that will be shared by the City of Busselton and potentially the state government.
"We understand there will need to be a significant payment to Jetstar, it is a three year service, at the end of the first year or 18 months we will have a good idea as to whether or not this will be a success and whether or not there is a need for a new terminal.
"I really beg the city to focus on what is important, and what is important is getting the airline service."
Nationals WA leader Mia Davies said the state government had failed to convince Qantas of the merits of bringing the academy to regional WA.
"Once again we find the McGowan Labor Government asleep at the wheel when it comes to diversifying the economy in regional WA and creating jobs," she said.
"Having the Qantas pilot academy in Busselton would have been a boon for the South West economy and would have created a number of jobs and opportunities for local businesses.
Warren-Blackwood MP Terry Redman said failing to secure the Qantas pilot academy meant the promised upgrade to the Busselton Margaret River Airport terminal would be further jeopardised.
"The regional development minister will use this as yet another excuse for denying the South West the airport upgrade the region so desperately needs to lure interstate and international tourists," he said.
"With the imminent signing of a contract with an airline, it is time Minister MacTiernan honoured her previous commitment to fund the upgraded terminal.
"International flights will only become a reality if the appropriate infrastructure is in place, and now is the ideal time to invest in our tourism potential."
Vasse MLA Libby Mettam said it was well understood that establishing (and maintaining) new routes in regional WA were a significant challenge, requiring State Government support, at least initially, to succeed.
"I am less concerned about the withholding of terminal funds in isolation, it is the withdrawal of this project from Tourism WA's tourism plan, airline engagement and the manner in which this Government has consistently undermined this project is the main concern," she said.