The Labour Party has announced a new policy to force airlines to show real prices up-front.

It would also require airlines to provide automatic refunds when flights were cancelled or significantly changed.

"Flying is expensive, and on many regional routes there is little or no competition," leader Chris Hipkins said on Thursday.

"Kiwis are struggling with the cost of living and are finding it harder and harder to make those important trips. Only Labour has a real plan to tackle it across the economy."

The policy would require airlines to show real-time airfares so customers can compare the true cost of flights.

Compensation or reimbursement would be given to passengers when checked baggage was significantly delayed or a paid service not delivered.

Labour commerce and consumer affairs spokesperson Arena Williams said: "When an airline screws up, passengers shouldn't have to fight to get their money back.

“If your flight is cancelled or significantly changed, you'll get an automatic refund."

The party said it would open the skies to more competition by offering fair access to airport infrastructure so smaller airlines could compete.

Williams said there was limited competition for regional routes, leaving less choices for travellers and less pressure on airlines to offer better prices.

"Smaller airlines shouldn't have to compete with one hand tied behind their backs. Labour will give them fair access to the airport facilities they need to grow and connect regional New Zealand."

Earlier this week, the government offered up $5.7 million out of the Regional Infrastructure Fund for regional airlines to help manage operating costs putting pressure on the sector.

"National's answer has been to hand smaller airlines a bit of extra cash to help them get by, while leaving the barriers to competition in place. That won't help smaller airlines grow or give passengers more choice,” Williams said.

Under the policy, airlines would be required to publicly report delays, cancellations and baggage performance.