‘Embarrassed?’: Qantas’ boss Alan Joyce grilled on $24m pay
Qantas boss Alan Joyce has had to defend his personal pay and bonuses for a Senate inquiry into the cost of living.
Qantas CEO Alan Joyce has been forced to defend his eye-watering personal pay for an Australian Senate inquiry into the cost of living.
Mr Joyce, who will retire as CEO in November after 15 years, is reported to be leaving with a $24 million golden handshake.
He underwent 1.5 hours of questioning about competition in the market, high airfares, cancellations, Covid travel credits and Qantas Chairman’s Lounge membership on Monday afternoon after he was issued a summons to appear before a Senate select committee.
In a heated exchange, Labor senator Tony Sheldon, a former Transport Workers’ Union national secretary, asked the outgoing CEO whether he felt “embarrassed” about his own pay given Qantas was the most complained about company to the ACCC and his decision to restructure the airline with “massive pay cuts resulting from mass outsourcing and sackings”.
“Don’t you feel embarrassed? Because I tell you what, I’d feel embarrassed if I was you,” Mr Sheldon told Mr Joyce.
Mr Sheldon also asked Mr Joyce whether the Qantas board had raised concerns about the airline’s credibility under his leadership.
During this line of questioning, in which Mr Joyce said he wasn’t being given appropriate time to respond and Mr Sheldon said he was “frustrated” by his indirect answers, the Qantas boss said the senator was making “a whole series of points that are just incorrect”.
Nationals senator Bridget McKenzie also grilled Mr Joyce on his bonus shares under the company’s long term incentive scheme.
In 2020, 2021 and 2022 – three years of cumulative statutory losses at Qantas – Mr Joyce deferred a decision on whether to take all the bonus shares he is entitled.
But Mr Joyce told Ms McKenzie he had chosen to accept those shares this month because he was leaving as CEO in November and the company was now back in profit.
The Qantas Group posted a statutory profit after tax of $1.74 billion last Thursday.
While Ms McKenzie criticised that he was now able to “cash out” despite three bad years and described it as “a very cosy arrangement”, Mr Joyce said the arrangements were set up by the board and voted on by shareholders.
Mr Joyce also pointed out he took no base salary for a period of time in 2020.
Moment senator couldn’t believe
It was revealed on Monday the Qantas Group was holding an extra $100 million in Covid travel credits through Jetstar, which had not been disclosed.
Mr Joyce had said there were $370 million worth of unclaimed credits last week when discussing the Qantas Group’s full year results, which has now been confirmed did not include Qantas-owned budget airline Jetstar or international customers.
Mr Sheldon asked Mr Joyce for the total value of flight credits remaining across the whole Qantas Group, but group executive for corporate affairs Andrew McGinnes stepped in to say they would need to take the question on notice because they didn’t have the figures in front of them.
“You’re coming to an inquiry to talk about cost of living and you’re saying to me you can’t give us a total figure?” Mr Sheldon said.
After further questioning Mr Joyce confirmed the $370 million number he had previously quoted did not include Jetstar and overseas customers, but he could not say how much the total value of credits would be if they were included.
He claimed he had only given the value of Qantas Australian credits previously because that was what had been asked.
Mr Sheldon couldn’t believe a total figure could not be provided at the hearing.
“Seriously, we are here asking questions about substantial sums of money that is owed to the Australian public, overseas and through the Jetstar operation, that has not been paid,” he said.
Mr Sheldon then asked Jetstar CEO Stephanie Tully directly, who also appeared before the committee.
She said unclaimed Jetstar travel credits sat at around $100 million.
“One of the important factors for Jetstar is that about 50 per cent of that $100 million is less than $100 [per customer],” Ms Tully said.
Mr Sheldon asked whether Qantas and Jetstar would extend the deadline to use flight credits beyond the end of this year, adding: “You say it’s only $100, $100 to a lot of people is a considerable amount of money.”
Ms Tully and Mr Joyce did not say the deadline would be extended.
Ms Tully said the reason the travel credits had not just been refunded was because they included half taken trips, codeshare flights with other airlines, and because of the time that had passed, people’s credit card details had changed.
Last week, Mr Joyce said 80 per cent of Australian Qantas customers with travel credits can get refunds.
“My message to everyone out there is that if you have a credit, call a call centre,” he said, adding there was a dedicated team to deal with this.
“Ring that, get the credit, either use it for a booking … or ask for your money back and we’re very happy to do that.”
Qantas’ Travel Credits Concierge Team can be contacted on 1300 171 505.
Earlier in the week, class action law firm Echo Law announced it had lodged proceedings against Qantas in the federal court over travel credits.
On Tuesday, Prime Minister Anthony Albanese made it clear he believes Qantas and Jetstar should honour the credits, which are due to expire on December 31.
“They need to look after their customers, and there’s no question that needs to occur,” Mr Albanese told ABC Perth.
“When people have made bookings in good faith, they then need to either have that money returned or they need to be able to use those bookings in order to make future flights.”
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