MONDAY, 20 APRIL 2020
SUBJECTS: Support for Australian aviation industry during Covid-19; Virgin Australia.
CATHERINE KING, SHADOW MINISTER FOR TRANSPORT, INFRASTRUCTURE AND REGIONAL DEVELOPMENT: Thanks everybody. I’m Catherine King, the Shadow Minister for Transport, Infrastructure and Regional Development and we’re here at Melbourne Airport today in the Virgin Departures Terminal. I’m joined here today with many of my Victorian colleagues – Bill Shorten, Maria Vamvakinou, Daniel Mulino, and Rob Mitchell, amongst many of the other Victorian MPs who are here today, calling for the Morrison Government to support Virgin Australia to save the 16,000 jobs of Virgin workers. But not just the 16,000 jobs of Virgin workers and the 3,000 jobs here in Victoria, but the many businesses that rely on Virgin Australia. Of course, our tourism industry is so critical to our regions and it will be so critical to our recovery. Also our freight industries that also rely on Virgin for transporting freight around the country. We know that having two strong airlines in Australia, two strong airlines, serves our economy well. The Morrison Government needs to urgently extend a lifeline to Virgin Australia so that it can survive this crisis.
We know as we start to come out of this crisis, the economy is going to need a strong two airline policy to ensure that we’re still able to connect people, not just between our cities and our regions, but again to the world. I cannot understand why Scott Morrison is being so intransigent on this issue. The jobs of 16,000 people rely on this Government stepping up, expanding either a guaranteed line of credit or taking an equity stake in this airline to make sure that it can survive into the future. We’re joined here also by Tash, by Tony, and Marcella who will speak to you afterwards about the impact having so, so much uncertainty is having on them at this critical time. I might just ask Maria to say a few words, many of the Virgin workers live within her constituency. I’ll also ask Bill to say a few words and then I’ll come back to questions.
MARIA VAMVAKINOU, MEMBER FOR CALWELL: Thank you. Maria Vamvakinou, the Member for Calwell. I like many of my colleagues in the last few weeks have received many distressed calls from local constituents who are experiencing job losses and job stand downs as a result of the Coronavirus. In particular I have received many calls from Virgin employees who do live in my electorate, and indeed the airport is in the federal seat of Calwell, who are hoping with great anxiety that the Government does something to save not only their jobs, but also save our second airline. This electorate in particular has suffered job losses as a result of many manufacturing companies closing down in recent times, and over the last 15 years or so. Ford in particular is a case at hand. We are familiar with job losses. We rely heavily on government supporting policies that allowed job creation in this country and I really appeal to the Government on behalf of the people who work for Virgin and who are in my electorates and in surrounding electorates. I’m looking directly at Tony, he lives in Broadmeadows, he’s here today to speak on behalf of his colleagues. I appeal to the Government to do what is necessary to save the airline and save jobs. Not only Australia-wide but save jobs here in Victoria. Thank you.
BILL SHORTEN, MEMBER FOR MARIBYRNONG: Good afternoon, everybody. Bill Shorten here. In my electorate, which borders the airport, there are hundreds of aviation families who are facing the prospect of their breadwinners losing their job. I’m here on behalf of aviation workers, and the TWU, the ASU, aviation workers, the local Labor MPs are calling upon the Morrison Government to make sure that Virgin doesn’t fall over. If Virgin collapses 16,000 contract and direct jobs will be lost. If Virgin collapses, a lifeline to the regions will be cut. If Virgin collapses, we will see the tourism industry in Australia under diabolical pressure. If Virgin collapses then we will see a monopoly, one large airline controlling Australia’s skies. You’d have to believe in unicorns if you think that one large airline won’t see airfares go up.
We want the Government to help rescue Virgin and the 16,000 jobs. So the dream of cheap airfares in Australia doesn’t die. The argument that Virgin is a foreign airline doesn’t wash, because the only people who will replace Virgin will be a foreign airline with foreign crews on much lower pay rates flying in Australia’s skies. And also, just in case some people think that airlines collapse all the time, and this is just life, that is not true. But there will be a big IOU if Virgin collapses. Unions estimate that the taxpayer will be up for $800 million if all the entitlements of 16,000 workers have to be paid out. So rescuing virgin is good for 16,000 jobs. It’s good for the taxpayer. It’s good for local jobs. And it’s good for cheap airfares in Australia. Thank you very much.
KING: We’re happy to take questions.
KING: What we’ve seen is a call from Virgin Australia to the tune of $1.4 billion. They’re not asking for a bailout. They’re not asking for a handout. They’re asking for the Government to either guarantee a line of credit, or in fact to take an equity stake in the airline. That is what Virgin is asking for. That is not a great deal to ask when you’ve got 16,000 jobs on the line, the future of our tourism industry, and in fact the future of the economies in many of our regional areas. In regional Queensland for example, Virgin is the only carrier that flies to many of the smaller communities in Queensland. And they have been doing that for some time. If the Government thinks that these equity partners that are coming in at the moment, who are certainly like sharks, and that Virgin are going to continue to run regional routes, that are not necessarily very profitable, then frankly they are absolutely dreaming.
JOURNALIST: How much would you like to see taxpayers contribute to support the airline?
KING: We certainly ask for the Government to listen to Virgin, and to assist them with their request, which at this stage is between a $1 billion to $1.4 billion in terms of a line of credit. What we do know is if the Government doesn’t act, if this company goes into voluntary administration, there are 16,000 workers, who will be seeking Job Seeker assistance. And that is at the cost of over $800 million and potentially up to a billion dollars. What cost per job? Frankly, we know the Government has the capacity today to save this airline. To ensure that what we promised in the Aviation White Paper when we were last in Government, that we can continue to have two strong airlines to drive down the cost of airfares, to have competition on routes across the country, and to ensure that we manage to employ as many Australians as possible in the industry. So far, all we’ve seen from Scott Morrison is a piecemeal approach to fixing aviation, and then abandoning 16,000 workers.
JOURNALIST: How long do you think Virgin has before it ends up in voluntary administration if the Government doesn’t act?
KING: Virgin is obviously in a share trading hold at the moment, and that ends in a few days’ time. Virgin does not have a great deal of time for the Government to get its act together to extend this lifeline to save the jobs of 16,000 workers. I know people are working incredibly hard behind the scenes to try and make sure that they can extend their capacity to employ people for as long as possible. But frankly, this is not news. This has been on the radar for at least a month and a half. Virgin already was struggling because of bushfires and the downturn in tourism. It had already undertaken a substantial restructure and the Morrison Government has been aware for well over a month and a half, up to two months that Virgin has been asking for assistance. It’s about time it stopped dilly-dallying, and actually got on with the job of saving 16,000 workers.
JOURNALIST: Catherine, how concerned are you about the well-being, the mental well-being, of Virgin workers?
KING: This is incredibly stressful, like Maria, like Bill, like Rob and like Daniel and all other members of this community here in Victoria, who have e-mails daily by constituents who are Virgin workers, who are incredibly stressed about what the future holds for them. Many of them have actually been through the Ansett collapse and they’ve seen just how long it took, how hard it was, and how many of them had to change substantially their way of life because of that airline collapsing. They are anxious. They are asking the Government to actually save their jobs, but to not just save their jobs, to ensure that we continue to have two strong airlines competing with each other in the national interest. It’s in the national interest that we have those two airlines, not just some cut rate domestic carrier that’s just flying a couple of routes. We actually need those choose strong carriers. That is what those workers are asking for. They want to save their jobs, they want to save their livelihoods, they want to make sure that it’s in the national interest that we continue to have these two carriers.
JOURNALIST: What’s your view on the stoush we’ve seen today, between Queensland and New South Wales over the future of Virgin, each state potentially vying for the opportunity to host the headquarters if they put in money?
KING: Well good on the state governments, the Labor State Government in Queensland, we’ve now got the Berejiklian Government in New South Wales stepping up saying they want to see Virgin survive this crisis. They know what is at stake here. They are prepared to step up. They’re obviously being cheeky in the process of competing for the head office. They want these jobs. They know how important they are for the economy. What is so astounding is while you’ve got state governments prepared to step up, you’ve got complete and utter silence and inactivity from the Morrison Government on this issue. They need to step up. This is a national issue. It’s in the national interest that we continue to have these two airlines.
TRANSCRIPT – PRESS CONFERENCE – MELBOURNE