As Qantas announces 5000 job cuts and a pay freeze, Labor says it’s open to supporting a government debt guarantee for the national carrier.
Labor says it is prepared to consider backing a debt guarantee for Qantas to shore up Australian jobs, but not majority foreign ownership.
The airline announced on Thursday it would shed 5000 jobs in a bid to cut $2 billion in costs over three years after revealing a half-year loss of $252 million.
It will also freeze the wages of its 33,000 employees, retire old planes, cut some routes and slash its capital spending by $1 billion over two years.
Opposition Leader Bill Shorten said the shedding of 5000 jobs was a tragedy, but now that the airline’s management had announced its plans there was no excuse for the government not to step in.
“This is the worst day for aviation people since the collapse of Ansett,” he said.
The government had only been floating “thought bubbles” since late last year, when the airline’s credit rating was cut to junk status, instead of working with Qantas and the opposition on ways to guarantee its future including a short-term debt guarantee.
Most of the airline’s major international competitors had some form of government support or ownership, he said.
“We’d be the bunnies if we waved goodbye to an Australian icon.”
However Labor would not support laws to allow Qantas to be majority foreign owned, as this was not in the national interest because it would allow the airline to send jobs offshore and put regional and rural domestic routes at risk.
Opposition transport spokesman Anthony Albanese said the issue of changing the Qantas Sale Act was a distraction for government inaction.
If foreign investment was an issue, he said, the airline would already be at its 49 per cent foreign ownership limit and not the current 39 per cent.
Liberal deputy leader Julie Bishop said the government deeply regretted the job cuts and Labor should support repealing the carbon tax to remove $100 million a year of costs from Qantas.
“The role of government is to ensure it is easier to do business in Australia, not harder,” she said.
Independent senator Nick Xenophon has called for a judicial inquiry into the company’s financial mismanagement, taking aim at CEO Alan Joyce.
“The jobs that should have been lost are Alan Joyce and his board,” he said.
Greens deputy leader Adam Bandt said that rather than provide a debt guarantee the government should buy a stake in Qantas.