SKY NEWS AFTERNOON AGENDA
FRIDAY, 3 APRIL 2020
SUBJECTS: Support for the Australian Aviation Industry through Covid-19 crisis.
LAURA JAYES: Let’s go live to the Shadow Minister for Infrastructure and Transport, Catherine King. Thanks so much for your time. What is your position on this? Because it’s a tricky one, Catherine King, Virgin is 90 percent foreign owned, why should they get a taxpayer funded bailout?
CATHERINE KING, SHADOW MINISTER FOR INFRASTRUCTURE, TRANSPORT AND REGIONAL DEVELOPMENT: Well, it is in Australia’s interest to have to the two airlines, and of course the budget carriers, that go with that as well. It is absolutely in our national interest not to have a monopoly when it comes to flights both domestically, and then the spin off that that means internationally as well. The Government has got to make a decision here, airlines are absolutely crucial to the future of recovery of this economy from Coronavirus. They’ve got to make a decision. If the Government is saying it is prepared to let one of the airlines fail, it will be on its head.
We all lived through the collapse of Ansett. We saw that thousands of workers were put out of work. Not just for a short period of time during an emergency, like we’ve seen with Coronavirus, many of these workers were out of work for years. If the Government is saying it thinks that airlines are different to everybody else, they are wrong.
The airline is part of the national interest, it is part of the recovery, and the Government needs to make sure that we continue to have the sort of structure we have with our aviation industry going into the future. When Labor was last in Government, we undertook a substantial white paper, which showed that structure – having the two dominant players, having budget carriers, having regional carriers under that, served us well. Our Airlines are our face to the world. They are our face to connecting our cities and our regions. The Government needs to make sure that structure stays and they don’t fail.
JAYES: Sure, but why does have to be Virgin? Couldn’t the Government, with the support of the Opposition of course, facilitate another player into the market?
KING: It takes a very long time, as we saw when we had Ansett collapse; it takes a very long time for that to occur. In the meantime, there are thousands of jobs lost, thousands of workers unable to get an income. You also have a long lag time while you’ve got a monopoly player, and lack of competition in the market. It also means that you have less routes, and that’s something we don’t think the Australian Government should let happen. They know the problem; they have been told absolutely, what the problem is. If an airline fails in Australia, it will be on the Prime Minister’s head.
JAYES: Well Virgin also knows that and has seen the argument, so I guess I’ll put to you what Qantas has put forward – that it needs to be at a level playing field. Whatever advice or assistance, I should say, is offered to Virgin needs to also be offered to Qantas. Without verballing Alan Joyce at all, there is a risk he says at least that Virgin is rewarded for mismanagement of their own books for years. What do you say to that?
KING: Well, of course, not every airline player came into this crisis equally, we know that. That is well and truly public knowledge. I think of course Qantas is going to position itself in the way that it wants to do. And of course, you’ll see the sort of commentary you have from Qantas around that. But every business is different. We know what Virgin has said publicly about the assistance that they need. Qantas was not asking for that assistance beforehand. If we are going to continue to have a mixed market when it comes to the aviation sector, and those two players, the Government does need to intervene in that in order to save, frankly, the sort of industry structure that we’ve got currently. I understand that Qantas is, making all sorts of positions and claims about that. I don’t think it’s helpful, frankly, for them to do so. They’re in a different position to Virgin.
JAYES: But aren’t they in a different position to Virgin because, I don’t know, their share of the market, their management or is it something else that I’m missing here?
KING: Well, that’s a matter for them, frankly. I think what we’ve got at the moment is an industry structure that suits us well. We have two major players, we have those budget carriers and regional carriers. If the Government doesn’t want that to continue, then it should say so.
JAYES: If the Government is to bail Virgin out, to the tune of $1.4 billion, what is the other side of the bargain here? What does Virgin need to come to the table with in terms of paying back that money and a guarantee?
KING: We’ve clearly said that we think, in fact, that one of the good things the Government could do was in fact take an equity stake in Virgin. That then provides an asset later for the Government to divest itself of and that benefits taxpayers when it does so. We think that’s a sensible way of going forward.
The other thing is, of course, any money that’s put forward and it should be for any industry, frankly, there should be the guarantee around jobs. Guarantee around Australian workers being supported throughout this crisis, because if the Government supporting them, we want them to support workers as well.
JAYES: Catherine King, appreciate your time.