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Beware of ‘nursing a mug’ on Qantas, senator warns

April 1, 2014 Aviation, Headline News 2 Comments Email Email

egtmedia59The Government should take no further action on Qantas until and unless the company allows an independent audit of its books, with a focus on any cost-shifting that may have occurred between its different business segments.

That’s according to Independent Senator for South Australia, Nick Xenophon, who continues to push for forensic examination of Qantas’ books before any measures like relaxing the Qantas Sale Act are implemented.

In a dissenting report to the Senate Rural and Regional Affairs and Transport Committee’s inquiry into Qantas and the impact on Australian jobs, tabled on Thursday, Xenophon said there were too many “known unknowns” for the Government to make a Coles-Training_250X250pxdecision.

“The ACCC itself said it didn’t accept Qantas’s claims that the international business was in so-called ‘terminal decline’ as part of the Qantas/Emirates alliance application,” Xenophon said. “But the Government seems to have accepted CEO Alan Joyce’s word that Qantas needs government intervention to survive.”

“The only thing that seems to be in ‘terminal decline’ is the reputation of Alan Joyce and that of his Chairman, Leigh Clifford,” Xenophon added.

In particular, Xenophon said there should be no change to the Qantas Sale Act until the Government had closed the apparent loophole that would allow Qantas to become a foreign-owned domestic carrier controlling an Australian-owned international airline.

“If Qantas is able to replicate the Virgin Australia restructure, we could see an international airline that is technically Australian but doesn’t have any of its own planes or infrastructure, and is wholly supported and controlled by a domestic airline that is foreign owned,” Xenophon said. “Qantas would also potentially be able to offshore most of its operations, which would be devastating to Australian jobs.”

Senator Xenophon also acknowledged the problems in Australia’s broader aviation sector, including the much-debated ‘Open Skies’ policy, which he said had allowed a significant number of foreign carriers to flood Australia’s market.

“The Productivity Commission urgently needs to hold an inquiry into the aviation sector, because the Government simply does not have enough information to make good policy decisions,” Xenophon said.

“Jack Lang used to say ‘In politics, if you nurse a mug for long enough, he’s bound to die in your arms’,” Xenophon said. “It’s time for the Government to take a step back from Qantas and consider the bigger picture, or they’ll be the biggest mugs of all.”

Written by : Peter Needham

Currently there are "2 comments" on this Article:

  1. AgentGerko says:

    Where are all these carriers that Open Skies is flooding us with? We have one carrier from the continent of Africa (SA), one from South America (LA), three from North America (UA, DL, HA) and one from Europe (BA). Even from the Middle East we have added EK, QR and EY but lost MS and GF. A couple of new airlines from China is not exactly a flood. There are considerably fewer international carriers visiting Australia now than there were 20 years ago.

  2. omg says:

    …..agentgerko, stop misinforming the public…

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