Thursday, 28 August 2014
Questions without Notice
I recognise the member's interest in Qantas and the services that it provides to his electorate and many parts of Australia. We all know that Qantas has gone through very difficult economic circumstances in recent times and, particularly, its international business is suffering from very heavy levels of competition. The accounts announced by Qantas today reflect some of that background. While the loss was perhaps a little less than the market expected, the changes to the accounting arrangements—and in particular bringing to account the lost value in the 747 aircraft fleet—has led to a spectacular headline loss figure. As I understand it, the 747s were bought at a time when the dollar was at US56c or US57c. They are actually on Qantas's books at the present time at a value higher than the price you could buy a new aircraft for. Clearly they had to deal with those sorts of issues.
The reality is there is some encouragement for Qantas shareholders in the report. The CEO has foreshadowed that they expect the airline to return to profit in the first half of next year and that is encouraging; that is, I think, better than the market would have expected. They are continuing with their processes of reform but they believe the airline has turned the corner. I am encouraged by that news. Qantas is a very substantial Australian business and, indeed, a part of our national history, and I welcome their assessment that their worst days are behind them and they will be able to move to profitability fairly soon. My understanding is that a part of the cost cutting that Qantas has undertaken includes the CEO himself taking a pay freeze, and I think that sets an example that many other CEOs in these situations might well like to consider.
The final thing I would like to mention is the acknowledgement by Qantas in their report about how valuable it has been that this parliament has got rid of the carbon tax. The abolition of the carbon tax will save Qantas over $100 million a year, and that will help to return them to profitability so much the faster.