Prime Minister Tony Abbott says he is determined to remove the government-imposed “ball and chain” holding back national carrier Qantas from restructuring its business.
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The federal government has indicated its support for providing the airline with a debt guarantee and for lifting restrictions on the airline accessing foreign capital under rules currently in place under the Qantas Sale Act.
As Qantas prepares to announce a major half-year loss and unveil up to $2 billion in cost cutting measures on Thursday, Mr Abbott declined to buy into the debate over what measures the airline's management should take to improve the business.
The Prime Minister brushed aside suggestions of a “secret deal” between the government and Qantas that could see the airline give guarantees that some maintenance workers' jobs, for example, would remain in Australia in exchange for government assistance.
“What Qantas does has got to be a decision for Qantas management. The government does not run airlines. It's a long, long time since government has run airlines and I don't believe that government should run airlines," he said.
“We want to ensure that Qantas management, as far as is humanly possible, doesn't have any government-imposed ball and chain around their ankles and that's the problem with the Sale Act - it is a significant restriction on Qantas' freedom of manoeuvre and that's why the government is considering legislation to establish a level playing field in this area.”
Mr Abbott said the Labor Party used to believe that governments shouldn't run airlines but “I don't know what their current belief is”.
Opposition transport spokesman Anthony Albanese called on Mr Abbott and Transport Minister Warren Truss to declare what assistance would be handed to the airline and to protect jobs that could be cut on Thursday.
Mr Albanese said Labor supported the provisions in the Sale Act because it ensured maintenance and other jobs stayed in Australia and ensured regional areas were serviced by the national carrier.
“It's about time that Tony Abbott and Warren Truss said what their plan is for Qantas instead of sitting back while threats are being made to the job security of these people who work at Qantas," he said.
The government could move to make the removal of the debt guarantee conditional on the airline being allowed greater access to foreign capital.
Such a move would put additional pressure on Labor to support changes to the Qantas Sale Act, which restricts Qantas to 49 per cent foreign ownership, foreign airlines to a maximum 35 per cent stake and any single foreign shareholder to a 25 per cent stake.
Any move to change the Sale Act would likely be blocked in the current Senate, which is dominated by Labor and the Greens, and the next Senate, which will sit from July 1.
