Liberal MP calls for Qantas Sales Act change

A Liberal backbencher is today calling on his party to get rid of the ‘romantic sentiment’ that Qantas must remain in Australian hands.

Dan Tehan is the Liberal Member for the southern Victorian seat of Wannon and was recently appointed the convener of the Coalition’s ‘Friends of Tourism’ group – a group which has a history of influencing government decisions about the airline.

Mr Tehan has spoken out today saying that Qantas’s current business model is not working.

“What I’m calling for today is for us to look at the Qantas Sale Act,” he said.

“Obviously Qantas needs to have this regulatory straight jacket taken off it so it can continue to prosper and grow as a company.”

The Qantas Sale Act currently limits foreign ownership in the airline to 49 per cent, however the Government has been hinting for weeks that those restrictions might soon be rolled back.

Last month the airline announced that it was expecting massive financial losses, slashing up to a thousand more jobs and said it may have to impose wage freezes.

Mr Tehan says these are signs that the company is in danger of folding without significant changes.

“There are obviously serious concerns at the moment about its long term future,” he observed.

Aviation analyst Neil Hansford says splitting Qantas into three subsidiary groups would be more effective than an increase in foreign ownership.

He says Qantas is facing a marketing problem, and Australians need to put their money where their mouths are, or let the airline go.

“A half-yearly $300 million loss is not a good way for the company to be operating, and we have to make sure that it has the best environment to which it can operate in and also encourage proper competition in the Australian market place, and that’s why I think we should look at the Qantas Sale Act.”

Dan Tehan says the nationality of investors in the airline does not matter as much as its success.

“It is an iconic Australian company and that’s why we should do everything we can to allow it prosper and flourish,” he argued.

“What we’ve seen is, if you seek to protect and subsidise, it actually has the counter idea of what it’s seeking to achieve and we’re seeing that with Qantas in a way.

“That’s why I think the best thing we can do is pull the opener up to competition and to allow foreign investors to come in and provide much needed capital if they see it as in their interests to do so.”

QantasLink concerns

However, the Opposition’s transport and infrastructure spokesman Anthony Albanese disagrees.

“If you simply open up Qantas to a free for all, in terms of the market, what you will see, particularly given what the price of Qantas is at the moment where you have a share value that is less than the cash reserves of the company … is an obvious move which would be to come in to split up the company,” he warned.

Mr Albanese says that could put Qantas’s regional arm at risk.

“Qantas plays an important role in our national economy and is not just another company,” he argued.

“If it is split up, then the consequences for QantasLink, for people in regional communities, are severe indeed and that is what you would see. That is what the risk is if you remove all of the restrictions that are there.”

However, the Coalition’s Dan Tehan believes the Government will be taking action on the Sale Act soon.

“I think it is an issue that will probably come up again this year at some stage,” he said.

“Obviously Qantas is facing some challenging circumstances at the moment and therefore I think it will be an issue which will come up.”

The Federal Transport Minister Warren Truss has been contacted for comment.

Topics: Qantas
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