Qantas is seeking legislative changes from the federal government to “level the playing field” with its rival Virgin after it announced 1,000 job losses, foreshadowed its first loss in the six months to December and announced cost-cutting to save $2bn over three years.
The Qantas chief executive, Alan Joyce, complained the airline was shackled with legislated foreign ownership restrictions while Virgin was enjoying a massive cash injection from its foreign state-owned enterprise shareholders while continuing to be designated an Australian airline.
Joyce phoned the treasurer, Joe Hockey, the transport minister, Warren Truss, and the opposition leader, Bill Shorten, immediately after issuing a statement to the stock exchange.
The prime minister, Tony Abbott, said he “grieved for every worker whose job has been lost”, but the best thing he could do was strengthen the economy. “While I don’t say there is any one measure which is some kind of magic wand … we have to get taxes down, regulations down … we have made a very good start and it would be even better if members opposite would not constantly try to oppose the policies we took to the election,” he said.
The environment minister, Greg Hunt, linked the airline’s woes to the fact that it was “under real pressure from the carbon tax”. He said the government could fix aviation if the opposition “get out of the way” of the carbon tax repeal.
Shorten responded angrily: “Stop politicising job losses, shame on you.” He said Joyce “does not say carbon had anything to do it”.
The government has called for a “national debate” on the price Australians are prepared to pay to have a national carrier, with suggestions for government intervention including lifting the foreign ownership restriction, making Qantas and Virgin subject to the same restrictions, buying back a stake in the airline which was privatised in 1992 or guaranteeing the airline’s debt.
Shorten also called on the government to provide support for the 1,000 workers losing their jobs just before Christmas.
The secretary of the Australian Council of Trade Unions, Dave Oliver, called on the government to intervene to provide the carrier with a level playing field and to help the sacked workers. “Before the election Tony Abbott was running around the nation with a fluoro vest and a hard hat, saying he was all about jobs, well, now is his chance to put his money where his mouth is,” Oliver said.
Speaking on Sky, Joyce suggested the government could make Virgin subject to the same restrictions as Qantas – including the requirement that it be 51% Australian owned.
The independent senator Nick Xenophon and Labor senators Glenn Sterle and Alex Gallacher called on Joyce and the entire Qantas board to resign, accusing them of burdening the airline with losses from the Jetstar Asia business.
Xenophon said the government should “go through Qantas’s books” with a forensic accountant before it offered the airline any form of assistance, because “this whole thing is an absolute disgrace, if you look closely at the Qantas books, Jetstar Asia has been a dud and it has burnt a fortune of Qantas revenue”.
“I am alleging the Qantas group is shifting costs from Jetstar Asia onto Qantas,” he said.
Qantas stock fell more than 17% immediately after the news
The new sackings add to 300 jobs lost after the closure of the airline's heavy maintenance base in Avalon, Victoria.
In its statement Qantas said Virgin "should not have the benefits conferred by an Australian carrier designation when it has only 20% Australian ownership, and more than two-thirds foreign sovereign airline ownership''.
It said the Foreign Investment Review Board should investigate the foreign government funds being invested in its rival "to prolong anti-competitive action aimed at weakening Qantas".
Virgin is majority-owned by state-backed carriers Singapore Airlines, Air New Zealand and Abu Dhabi-based Etihad.
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