The Treasurer in Australia’s conservative Liberal-National government, Joe Hockey, has revealed he talked to Qantas chief executive officer Alan Joyce about the effect the carbon price was having on the airline.
The discussion came after the airline’s apparent change of mind on the impact the carbon price was having on the company’s bottom line.
AAP Newsagency reports it also came as the Liberal-National government prepared to introduce legislation to repeal part of the Qantas Sale Act.
However, the Treasurer rejected suggestions Qantas was leaned on to toe the government line.
Australia’s fixed price Emissions Trading Scheme (ETS) cost Qantas $106 million in 2012/13 and is tracking towards $120 million this financial year.
The airline angered the government earlier this week by rejecting Mr Hockey’s claims Qantas had cited the ETS as contributing to its current financial woes.
Two days later, after cabinet rejected the company’s request for a debt guarantee, or failing that, an unsecured $3 billion loan Mr Joyce admitted the ETS was among its most significant challenges.
AAP reports the Prime Minister Tony Abbott told parliament yesterday that neither he nor his office had spoken to Qantas about the issue.
Mr Hockey today revealed he had spoken to Mr Joyce and that the pair and talked about the company’s initial statement.
“It was nothing more than him saying the interpretation on the carbon tax was entirely incorrect,” he told ABC Radio.
A “low-level person” at Qantas had put out the statement that was not consistent with earlier comments from the company, the treasurer said he was told by Mr Joyce.
When asked whether the government had exerted pressure on Qantas to change its position, Mr Hockey said: “No, not at all. We haven’t leaned on the carrier.”
Meanwhile, the Liberal-National government has introduced to parliament legislation repealing foreign ownership limits on Qantas.
The Qantas Sale Amendment Bill 2014 could allow the airline to split its domestic and international operations.
However, it appears to have little chance of becoming law because the Labor opposition and the Australian Greens Party have said they will block the legislation in the upper house Senate.
The Senate composition will change in July this year but the Palmer United Party, which will have several senators in the new upper house has said it will also oppose the legislation.
If Qantas was able to split it operations the domestic business could then be majority-foreign owned, instead of the 49 per cent cap in place now.
Deputy Prime Minister and Infrastructure Minister Warren Truss told parliament the bill was about helping the Australian aviation industry to grow in an environment that was safe, fair, competitive and productive,.
“This bill means Qantas will no longer compete at a comparative disadvantage,” he said.
The best possible way to assist Qantas was to free the airline from “previous century” regulations that were holding it back, Mr Truss said.
AAP reports the government proposes to repeal part three of the Qantas Sale Act that in part, limits a single investor to a 25 per cent holding and foreign airlines to a combined total holding of 35 per cent.
Qantas ownership would be overseen by the Air Navigation Act, which limits 49 per cent foreign ownership of Australia’s international airlines, but with no restrictions on the ownership of domestic airlines.
The Qantas chairperson would have to be an Australian citizen, as must two-thirds of the board, and the airline’s head office and operational base must remain in Australia.
“This legislation means Qantas will no longer operate at a competitive disadvantage and that government regulation will no longer stand in the way of Qantas efforts to return to profitability,” Mr Truss said.
The opposition succeeded in bringing on an immediate debate of the bill.
“The debate should happen now, there should not be a delay,” manager of opposition business Tony Burke said.
Opposition transport spokesman Anthony Albanese said debate was necessary because the government had previously indicated Qantas would get a commonwealth-backed debt guarantee.
Leader of the House Christopher Pyne said the government would allow debate to proceed, predicting the legislation could be in the Senate by this afternoon.
