Senate debates

Tuesday, 17 October 2023


Commonwealth Bilateral Air Service Agreements Select Committee; Report

6:00 pm

Photo of Bridget McKenzieBridget McKenzie (Victoria, National Party, Shadow Minister for Infrastructure, Transport and Regional Development) Share this | | Hansard source

I move:

That the Senate take note of the report.

This is the first report of the Commonwealth Bilateral Air Service Agreements Select Committee. This Senate inquiry didn't have to happen. If the Anthony Albanese Labor government had been upfront and explained to the Australian public why it chose to block Qatar Airways's application for more flights and why it decided to put the interests of Qantas above the interests of everyday Australian travellers, this inquiry would never have had to happen. Indeed, this government—and this Prime Minister in particular—chose to look after their corporate crony mates, particularly former CEO Mr Joyce, and, more generally, the Qantas Group.

As the inquiry disclosed, as the ACCC has found and as the High Court has made clear, Qantas's corporate behaviour has been appalling. Our once-beloved national carrier has been despicable to its loyal customers, has flagrantly pursued and sacked its staff—illegally it has been found—and has sought to pocket nearly $½ billion of its own customers' COVID flight credits. On any measure, Australians are frustrated by the behaviour of the Qantas Group, and that came flowing out during this inquiry. The inquiry heard from over 140 submitters. Over 100 everyday Australians put pen to paper or keyboard to email to vent their frustrations and disappointment in a once-loved national carrier.

Rather than be upfront and honest, this government gave nine different and sometimes contradictory reasons for why it restricted competition and protected one airline's dominant market share over others and kept prices high. Ironically, this committee captured all but the built-up frustrations and traumas of families who lived through the COVID epidemic, when they were unable to fly to reach their loved ones they had been separated from, and who had literally been ripped off by a company that they thought had their nation's back. Qantas loves to trot out the 'national carrier' adjective, but when the chips were down Qantas was nowhere to be found. Frequent flyer points were debased, COVID flight credits could never be used, precious baggage was lost, and flights were delayed and cancelled, not to mention the behaviour of the Qantas board and management towards its loyal and professional staff while rewarding its departing CEO with an eye-watering golden parachute whilst he oversaw the trashing of this once-great Australian company's reputation. This inquiry became a lightning rod for all of these frustrations.

Nothing more epitomised the out-of-touch arrogance of this corporate than the evidence of Qantas's own Mr Finch—a man on millions of dollars. He claimed and complained to the senators that he was concerned about being delayed for a flight out of Canberra Airport. This guy earns enough that he could actually have chartered his own plane from Qantas to get home to Sydney that night. I can confirm that they made their flight. The flight was held, and Ms Hudson made it. But that's not so for tens of thousands of frustrated Australians who have had to hear those horrible words: 'Your flight's been delayed,' or, 'Your flight's been cancelled. We've bumped you to the next one. We'll put you up in a hotel.' You've got three screaming kids and you have to buy new baggage. The arrogance of Mr Finch, honestly, beggared belief and, I think, touched a nerve, shall we say, among the broader Australian public.

Yet the Albanese government, at every juncture, chose to side with Qantas rather than with the Australian travelling public. They chose to continue their protection racket for Qantas, the flag bearer of their now failed 'yes' campaign, gagging public servants, ignoring the advice of eminent ACCC commissioners, past and present, and ignoring the tourism industry, aviation experts, academics and other airlines. They're still doing this tonight, in the midst of the unfolding crisis in the Middle East, where Australians who are trapped in that war zone are hoping to catch mercy repatriation flights out of Ben Gurion Airport in Tel Aviv back to their loved ones in Australia. They're not telling Australians that one of the airlines that offered to help repatriate Australians who are trying to get out of Israel safely and securely was Qatar Airways, which also helped Australians out of Kabul and which also helped Australians get home during COVID. The government haven't mentioned its name because they're still running a protection racket for Qantas.

The Albanese government are tone deaf to the issues affecting everyday Australians. While the government has been solely focused on campaigning on the divisive referendum, the Australian public are simply trying to make ends meet. On 10 July the government blocked the application from Qatar Airways that would have meant the cost of getting from Australia to Europe through the Middle East was lower and you had more choice of destinations.

This Qantas inquiry should never have been needed, but it became beholden on the opposition to find out exactly what had happened, in whose interests the decision was made, who influenced the decision and what, if anything, was negotiated in return for this decision, which solidified and protected Qantas, with its dominant market share in our aviation industry—and particularly after its appalling corporate behaviour. We tried asking questions at question time. We tried seeking the production of documents, and I thank crossbench senators and the Greens for joining with the coalition in trying to get documents out of the government. Did we get anything? No. So, in a last-ditch effort, we put up an inquiry. I will be forever grateful to the crossbench senators who allowed this inquiry to be held.

While the government will trash this inquiry and its report as a political stunt, I would urge anyone who has an interest in this sector to read the report. The evidence, as I said, was overwhelming. Qantas is the only submitter who doesn't want the ACCC's monitoring of cancellations and delays in the aviation industry, which shows that Qantas delays and cancels flights out of Sydney more than any other airline, despite having the same number of Airservices Australia staff and despite being subjected to the same weather concerns. It is incredible. It is the ACCC report that actually makes that clear. They don't want it, so the government hasn't done it. The only submitter that doesn't want this decision to be reviewed or the reasons to be made public and transparent is Qantas. It is the only one among the academics, competition experts and the like. We heard from Peter Harris, a former chair of the Productivity Commission and a very intelligent and incisive person, who conducted a review into the slots going in and out of Sydney airport. That review is sitting on the minister's desk right now. She could make the decision right now, based on evidence that's been consulted on, to change the outcome and the cancellations and delays in and out of Sydney.

All the crumbs of evidence as to why this decision was made, why the minister didn't take her department's advice to approve the negotiating mandate, lead back to three people: Prime Minister Albanese, Minister King and Mr Alan Joyce. That is why this committee has asked that, when Mr Joyce does return from overseas, he be called before a reconstituted committee to answer the serious and substantial questions that committee members have for him. He hasn't been up-front. He's been afforded largesse at the expense of staff, shareholders and customers, and he needs to face the music.

6:10 pm

Photo of Tony SheldonTony Sheldon (NSW, Australian Labor Party) Share this | | Hansard source

I rise to take note of the report of the Select Committee on Commonwealth Bilateral Air Service Agreements. We all know that Senate committees do extremely important work. I'm sure everyone in this place feels proud of the work they've done through the committee process, whether it's reviewing legislation or investigating important policy issues. Given all the vital, important work that the Senate does, it is unfortunate when Senate resources are tied up in political stunts like this inquiry. At a time when there are many important issues we could be looking into, we've instead been required to participate in this circus.

This inquiry was a circus where the chair of the committee refused to provide programs to government senators in advance of hearings, making it impossible to adequately prepare. It was a circus where the chair was making public announcements about committee decisions often before the decisions had even been agreed to, a circus where all the conventions for how committees should operate were thrown into the bin, a circus where we had to endure lengthy lines of questioning from those opposite that had absolutely nothing to do with the terms of reference and, in some cases, had absolutely nothing to do with the aviation industry. At one point, there was at least half an hour of questioning about the Voice to Parliament and Yes23 decals on Qantas planes. There was even the absolutely ridiculous suggestion that there was a link between the 'yes' campaign and our bilateral air service agreement decision.

This inquiry about bilateral air service agreements has been weaponised as yet another disinformation campaign against the Voice. It's not only a complete waste of all our time; it undermines and erodes faith in democracy in this country when such ridiculous accusations are made. It's particularly frustrating when the aviation industry actually does face many challenges that deserve proper and serious consideration, and I'll touch on those shortly. It's also very clear that this committee is not an appropriate vehicle for a serious investigation of anything. The suggestion that this committee should be given even more time and resources to run a disinformation campaign about the Voice is, frankly, obscene.

As Senator White and I noted in our dissenting report, this inquiry did not reveal a single piece of information that was not already on the public record—not a single piece. It did not reveal a single piece of evidence proving that Qantas has influence over the current government. In fact, the only evidence about Qantas's influence over government decision-making pertained to the previous government and the previous minister for transport, Michael McCormack. As the committee heard, Brisbane Airport was informed back in April 2018 that Qatar Airways was going to be given additional access to these markets and then, a week later, without warning and without explanation, there was a complete backflip on that decision. From what we can tell, the only relevant event that happened in the course of that week was that Mr McCormack hired a Qantas executive as his chief of staff, after which he suddenly had a change of heart about Qatar Airways market access. Of course, all of this was already on the public record. It was reported in the Courier-Mail five years ago. We didn't need to have a Senate inquiry to find that out either; we just needed internet access.

For many years, it has well and truly been a matter of public record that the Liberals and Nationals are captured by Qantas. I was there when Ansett collapsed and the Howard government sat on its hands and let it happen, to the great benefit of Qantas. I was there when Alan Joyce became Qantas CEO and the first thing he did was begin setting up labour hire companies to undercut longstanding workplace agreements, all with the explicit support of the Liberals and Nationals. I was there when Alan Joyce grounded the entire Qantas fleet in 2011 because some of the workers were wearing the wrong colour of tie as a form of industrial action, and again the Liberals and Nationals supported Joyce the whole way. I was there when Alan Joyce successfully lobbied the Morrison government to let Virgin collapse during the pandemic while they gave Qantas $2.7 billion with no obligation. And I was there when Alan Joyce illegally sacked 1,700 people.

This government intervened in that case on behalf of those workers. That's what the previous government wouldn't do. Minister McCormack said illegally sacking 1,700 people was 'in the best interests of the company going forward'. Christian Porter said illegally sacking 1,700 people was 'a good model'. Senator Cash said of the illegal sacking of 1,700 people. 'Qantas are entitled to make those decisions.' Either those three ministers had been improperly influenced by Qantas or they genuinely supported Alan Joyce destroying the lives of thousands of people. Which one is it?

As we speak, the Liberals and Nationals are standing hand in hand with Qantas to try to stop us from closing Alan Joyce's labour hire loophole, the loophole he created to split the Qantas workforce across 38 different companies to divide them and tear them apart. The Liberals and Nationals could stand with aviation workers and support closing the loophole, but no. They're standing with Alan Joyce, Richard Goyder and the Qantas board. There is decades of evidence of the Liberals and Nationals standing hand in hand with Qantas and particularly with Alan Joyce as he destroyed the airline. The Liberals and Nationals never cared for a second about what happened to those workers. They're happy for Alan Joyce to ruin the lives and livelihoods of thousands of Qantas workers and their families, but putting a 'yes' sticker on a plane is where they draw the line. My God!

That brings me back to the fact that those opposite have never demonstrated they care about our aviation industry. For nine years they took absolutely no steps to act on the issues that clearly exist within the sector. Upon coming to government, Minister King quickly established the green paper and white paper process so that we can have a thoughtful and considered approach to resolving these issues. There has been wide and extensive consultation through that process. Unlike the sham inquiry pursued by this committee, the white paper process can solve important problems—problems like the systematic destruction of the aviation workforce, the lack of consumer rights under the previous government's watch, and protections against anticompetitive behaviour, cancellations and gouging. These are real problems and they deserve real solutions, not political stunts.

6:18 pm

Photo of Dean SmithDean Smith (WA, Liberal Party, Shadow Assistant Minister for Competition, Charities and Treasury) Share this | | Hansard source

There are two very dry words in Australian politics at the moment. One is the word 'productivity', and the other word is 'competition'. I will talk about productivity reforms and why they're so necessary for our economy at another time, but front and centre for many, many Australians now is the unreasonableness, high cost and unreliability of service from the Australian airline industry in delivering important aviation needs to Australian consumers.

I think that, for a long time in Australia, aviation, travel and the connectivity that they deliver have been regarded as luxury items, but, if there's a learning from the COVID experience, it is that aviation has become much more of an essential service for Australians than a luxury good. It is an essential service because we know that increasingly Australians want to be able to travel to stay connected to their families in good times, like Christmas and birthday celebrations, but also in times of tragedy or unforeseen and unfortunate circumstances. That's particularly true of the increasing number of multicultural communities in our country, who don't just want to stay connected to their communities here in Australia but are particularly keen and interested, out of necessity, to stay connected with their families and communities abroad.

It's clear, from the report that Senator McKenzie has delivered to the Senate this afternoon, that competition in the Australian aviation sector needs urgent and immediate reform. It's very curious, in fact, that the government has decided to establish a competition review process, which I've got to say is very unstructured. It doesn't haven't the discipline of priorities, nor does it have the discipline of publicly stated time frames. It's a competition review process that consciously, at the beginning, ignored the importance of aviation issues. There's been a hastily-convened backflip on behalf of the Treasurer, Dr Chalmers, and the government's competition minister, Dr Leigh. They have belatedly decided to include aviation issues in that competition review, but they've not committed to make them a priority of the review's inquiry process, nor established a time line with regard to how and when those aviation considerations will be contemplated by the competition review mechanism. Instead, they're saying, 'Oh, no, we've got a green and white paper process,' which will put these important issues out on the never-never.

I predict with great confidence that we will not see one competition initiative presented to this parliament before the next election—not one. That's despite the COVID experience and everything that it taught us about the importance of aviation in our country, from a business and freight perspective but also from a social perspective, and despite the fact that we have the government's decision—which is friendless—with regard to greater access to an airline like Qatar. Despite all of that, we will not see one positive competition reform initiative brought to this parliament before the next election through the competition review process. That is the government being blind and deaf to the needs of Australian consumers. In the last day or so, as a result of the weekend's very decisive rejection by Australians of the government's key constitutional priority, the government has been quickly trying to make up for lost time. It's frantically now focusing on cost-of-living issues, but it's continuing to ignore the desperate need this country has for significant improvements in aviation competition.

There's one particular initiative the government could take immediately. It doesn't need a review process. It doesn't need legislative reform. The one initiative they could take immediately would be to reinstate the ACCC monitoring regime for the airline industry. The 13th and final report of that regime was released in June. Every single stakeholder that presented to Senator McKenzie's committee of inquiry—other airlines, airport operators, the travel industry—said that the government should reinstate the ACCC monitoring regime, because it was good for the industry, good for transparency and good for scrutiny. What is the one organisation that continues to resist the reinstatement of that ACCC monitoring regime? Guess. It starts with Q, followed by a-n-t-a-s. Qantas is the only organisation in this whole country that does not want that ACCC monitoring regime introduced. And guess who is listening to Qantas. It's the government. Indeed, at the committee inquiry, the Qantas CEO said:

We don't support a continuation of that review, because the findings were not significant.

That was the view the new Qantas CEO had, when in actual fact the report made numerous findings in regard to competition, consumer protections, poor flight regularity and poor service for customers. The Qantas CEO is the head of the only organisation in this whole country, other than the government, that doesn't want to see the ACCC monitoring regime reintroduced. How remarkable! And government senators have the gall to stand up here and argue that Qantas is not abusing its monopoly position in the Australian aviation market by standing over the government, standing over Dr Chalmers, standing over Assistant Minister Leigh and saying, 'We don't want that report, that monitoring regime, reinstated.' What a simple, easy, relatively inexpensive opportunity in the context of the government's huge expenditure! Nothing—it would cost the government nothing, relatively, to reintroduce that and give the industry greater transparency, greater scrutiny and reassure Australian aviation customers that they were not being ripped off, because, if you're an Australian aviation consumer at the moment, your starting position should absolutely be, 'I'm getting lower levels of standards, I'm getting poor reliability and I'm probably being ripped off.' And for someone like myself, who comes from Western Australia, who has to travel across the continent regularly—I do so willingly—and as someone who travels around Western Australia—which I do willingly—I know and I hear about the poor aviation experiences my constituents keep telling me about.

There's another issue in the report, which was canvassed in the inquiry, that has received less attention. I readily accept that it's probably not widely endorsed by many people in our country just yet, but that is the restrictive practice that air cabotage plays on denying a better economic development story and better economic development opportunities for northern Australia. I do not believe, and I don't think anyone in this country believes, there should be wholesale lifting of those restrictions. But I do believe, and I hope that others in this chamber do believe, there's an opportunity to review some routes and look at some opportunities where we can provide greater access to regional Australians living across the north of our continent with better access to freight and better access to passenger flights. There's a real opportunity here, and I think the answer is in giving greater access to low-cost carriers—not the big multinational sovereign-backed carriers but smaller low-cost carriers—to travel into our country to pick up and drop off aviation customers in Kununurra and Derby and Broome and other places across northern Queensland that Senator McDonald will be more familiar with than I.

So, this is a necessary report. I think it has done great work. I compliment Senator McKenzie and Senator Birmingham for their great effort in this. I'm disappointed that Senator Sheldon and others haven't seen the real opportunity for significant improvements in aviation services in our country that this report presents. I hope that others will give it due consideration over coming days. I encourage the government to reinstate the ACCC monitoring report. I seek leave to continue my remarks.

Photo of Andrew McLachlanAndrew McLachlan (SA, Deputy-President) Share this | | Hansard source

As no other honourable senator wishes to take note of the report, I give the call to the minister.