TRANSCRIPT
It's all still cloudy.
The Senate has been trying to understand the reasons behind Transport Minister Catherine King's decision in July to deny Qatar's request for 28 extra flights a week. The routes would have included Brisbane, Melbourne, Sydney and Perth at its start, but the minister argued that this was not in the national interest.
Virgin Australia's CEO, Jayne Hrdlicka, says otherwise.
“We remain confused about what has actually happened in relation to this matter. And that to this day, there is still no coherent logic for this decision. When all of the data suggests that supporting the Qatar Airways rights expansion is strongly in the national interest. It is certainly in the interest of consumers, the tourism industry and exporters”
Qatar Airways says it was shocked that the extra flights have not been approved by the Australian government, estimating that an additional $3 billion would have been injected into the Australian economy over five years if the extra flights had been granted. Speaking at the Senate inquiry on Wednesday, Qatar's Senior Vice President Aeropolitical & Corporate affairs, Fathi Atti claims he learned of the decision ten days before receiving an official letter from the minister.
SENATE: "So how did you find out on the 10th if you didn't receive a letter from the minister.”
ATTI: “Through the media.“
SENATE: “So you found out your application for additional flights was rejected by the Australian Government through the media?”
ATTI: “Yeah. The first time. And then on the 20th of July we received the letter dated 14 to our civil aviation which they passed it to us.”
Transport Minister Catherine King's office said that she had written to the Department for the Qatar Civil Aviation Authority in a letter sent by email on 14 July. Even so, Senior Vice President of Global Sales at Qatar Airways Matt Raos says the decision is not only affecting consumers, but also the tourism job market.
“We certainly don't think it's in the interests of small businesses operating in the Australian tourism economy and employing hundreds of thousands of people in tourism jobs.”
Qantas airlines has long been accused of hoarding slots, at least in Sydney. Bonza's CEO, Tim Jordan, says that there isn't enough access in the sector.
“I think in any industry where there is such dominant players, where there is a duopoly I think it yes, it raises the barriers to entry. Certainly. And when you actually look at Aviation, it is a very difficult industry to make work here in Australia and part of that reason why it has been hard for predecessors to bonza is because of the dominance and the concentration in the aviation sector.”
Alan Fels, a professor at the University of Melbourne Law School, says that the percentage allocated to Qantas can determine airfares for the entire industry.
“60% is a very high market share. So then you have to ask what about the others? Now, very often a dominant firm sets the pattern of prices for everyone. And my impression is that that's what happens in aviation. That countries sets the, the price level broadly speaking, that virgin and the others sit around and they may seem a bit below it, but there's a fairly stable relationship.”
As the Senate goes through its final day of spotlighting its decision, Qantas chairman Richard Goyder has joined the hearing, along with Qantas' new CEO Vanessa Hudson.
Ms Hudson says that Qantas cannot be held accountable for the increases in ticket prices.
“We understand the importance of affordable air travel and realize that there has been a lot of upward pressure on airfare since the COVID restart. That is not unique to Qantas or to Australia. It's not even unique to aviation. As the committee is painfully aware, inflation has driven up price of most things.”
Senator Bridget McKenzie, chair of the committee examining the federal government's decision, inferred that Qatar's decision could have been a "quid pro quo" for Qantas's endorsement of the Yes vote in the Voice referendum. Mr Goyder says that there has never been any discussion on the Qatar issue with the government.
“I've had no discussions with the Prime Minister or indeed any member of government on the Qatar decision”
Still, Professor Fels says that this investigation is of unprecedented importance as it can impact the lives of all Australians.
“There have been previous inquiries of various sorts into the system. But what is different about this one is that instead of it being about a lot of technicalities and so on, it's actually about the impact of the system on competition, cost of living, pressures on families and businesses, rural impact, tourism impact and the rights of airlines and so on to appeal decisions.”
The committee has also dealt with legal action over phantom flights, a Supreme Court ruling on illegally sacked workers and the consequences of the airline's final multi-million pound payout to former CEO Alan Joyce, who refused a request to appear before the committee due to "personal obligations overseas".
Meanwhile, Mr Goyder is facing widespread calls for resignation from Qantas pilots, who say this is "one of the most damaging periods" in the airline's history.
Qantas has confirmed that it will provide further documents to the committee, but only on a confidential basis.
