Qantas boss Alan Joyce has again defended the government’s choice to reject an application by Qatar Airways for more flights to Australia, hours after assistant treasurer Stephen Jones said it was in the national interest to protect Qantas from foreign carriers.
Joyce received a fierce two-hour grilling from the Senate select committee in Melbourne on the cost of living crisis, just days after the airline group – which controls 60 per cent of the domestic market through carriers Qantas and Jetstar – revealed a record $2.47 billion profit.
Qantas chief executive Alan Joyce on Monday.Credit: Eamon Gallagher
“We think Australia should protect its national interest,” Joyce said.
Joyce appeared at the inquiry with Jetstar boss Stephanie Tully and Qantas’ head of corporate affairs Andrew McGinnes. All three were embroiled in at times hostile exchanges with senators over allegations the airline had made the cost of living crisis worse for its staff and customers.
Joyce repeatedly asked to be granted the opportunity to speak after senators interrupted to demand he answer the question asked, rather than give a speech littered with information already on the public record.
Had Qatar Airways been granted the right to increase to 21 services per week it would have generated up to $800 million additional revenue for the tourism industry and put downward pressure on airfares to Europe. However, Joyce countered that Qatar had the option to fly bigger aircraft to smaller cities including Adelaide and Darwin if it was truly committed to boosting seat capacity in Australia.
Earlier on Monday, Assistant Treasurer Stephen Jones told media the federal government had made its call on the Qatar Airways request to ensure Qantas was profitable, contradicting previous statements by Transport Minister Catherine King who has faced backlash over last month’s decision.
King said on Monday she disagreed with Jones’ characterisation.
“I wouldn’t have used the same words that Stephen did... I’ve repeatedly said this was a decision that was taken in the national interest, and there’s no one factor that swayed my consideration... There is no doubt that [Qantas] needs to do better. I said that in opposition. I have said that repeatedly in government,” King said.
She also said the government has historically rejected multiple applications for additional bilateral air rights from other governments, deeming it “entirely unremarkable”. Joyce said Qantas has been rejected for additional flights from multiple governments including Fiji and France.
Virgin Australia’s head of corporate affairs Christian Bennet said Jones’ comments showed the government has chosen to favour its bigger rival rather than all Australian airlines. Virgin has a codeshare partnership with Qatar Airways and would have directly benefited from the additional flights. Although Qantas and Qatar are oneworld partners and have some reciprocal frequent flyer benefits, its codeshare partnership is with Qatar’s Middle Eastern rival Emirates.
“Any suggestion that denying Qatar additional flights was designed to protect Qantas’ medium-to-long-term sustainability neglects the fact that blocking Qatar damages the domestic and international competitive position of Virgin Australia in favour of Qantas,” Bennett said.
Joyce reiterated he would not comment on a report by the Australian Financial Review which said the 23-year-old son of Prime Minister Anthony Albanese, Nathan, had been issued a membership to the airline’s Chairman’s lounge, usually reserved for business leaders and politicians.
The Senate may use its powers to demand he reveal details about whether family members of politicians have been issued memberships to the airline’s exclusive Chairman’s lounge. Joyce agreed to come back to the committee about what he may be ready to divulge about political membership of the Chairman’s lounge in light of “security concerns”.
The chair of the cost of living committee, Senator Jane Hume, then thanked Qantas for her membership to the lounge and encouraged the other senators to divulge their membership. All six members of the committee have memberships.
Hume also said questions about the chairman’s lounge might be skirting the boundaries for an inquiry into the cost of living.
Joyce – who is the only ASX-100 chief executive to be summoned to appear before the inquiry so far – had a particularly heated exchange with Senator Tony Sheldon, a Labor MP who has long been critical of Joyce and formerly held senior positions within the Transport Workers Union, over Qantas’s alleged obfuscation on flight credits.
Qantas conceded after relentless questioning that the true sum of COVID-19 credits yet to be redeemed remains at least $100 million higher than the $370 million figure it has repeatedly referenced when accounting for Jetstar and overseas-based bookings.
Tully said the outstanding amount for Jetstar bookings was about $100 million, with the majority for tickets worth less than $100. The outstanding dollar figure for overseas bookings is expected to be between $50 million and $100 million, but Qantas said it would provide more information on notice.
The group has refunded $3 billion in COVID-19 travel bookings that the airline cancelled due to COVID-19 and has extended their expiry three times. About 80 per cent of the outstanding amount yet to be claimed by customers is eligible for a refund until the end of next year. The expiry date on claiming COVID-19 travel credits for most airlines worldwide has already expired. Qantas competitors Virgin Australia and Air New Zealand expire at the end of this year.
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