Qantas Group boss Alan Joyce has faced a senate select committee this afternoon on the impact his airline group is having on the cost of living crisis.
Less than a week after posting a $1.74 billion profit for the past financial year, Joyce faced a slew of senators criticising actions taken by the group.
The national carrier has come under scrutiny for its treatment of COVID travel credits, role in blocking additional capacity by Qatar Airways, slot hoarding allegations, providing of chairman’s lounge access to Anthony Albanese’s son and more.
Addressing the senators before questions began, Joyce apologised for how the airline was run during the pandemic and immediately after.
“When borders finally opened, the return to flying was not nearly as smooth as we had hoped,” he said.
“Sick leave, supply chain issues and aircraft still in hibernation meant the industry could not meet the huge demand for travel. The result was long queues, delays and cancellations, particularly in domestic services. And for our part we apologise sincerely.”
Qatar Airways blocking
One of the main points of inquiry by the senators was Qantas’ role in advising the government to block Qatar Airways from doubling its capacity to Australia. When asked about the conversations he had with the Prime Minister on the blocking, he refused to provide any information.
“Any conversations I have with the prime minister or a minister I never divulge. I’ve kept that for all seven prime ministers and I have no intention of changing my approach,” Joyce said. He also weaved around an answer when asked if allowing Qatar Airways to come back would mean lowered airfares.
On the decision to block Qatar, Joyce repeated the claim used by transport minister Catherine King when she asked about her blocking of the middle eastern airline: Qatar Airways’ rejection was made in the national interest.
“Qatar can add capacity through flying bigger aircraft to cities like Adelaide, Darwin. There is nothing stopping them from adding capacity to those locations,” Joyce said.
While Joyce was being questioned by the committee, Virgin Australia – the code share partner with Qatar Airways – accused the government of designing policy that would benefit Qantas.
“Any suggestion that denying Qatar additional flights was designed to protect Qantas’ medium-to-long term sustainability neglects the fact that blocking Qatar damages the domestic and international competitive position of Virgin Australia in favour of Qantas,” Virgin’s chief corporate affairs and sustainability officer Christian Bennett said.
COVID Credits
Joyce and Jetstar CEO Stephanie Tully received extended questioning about the unknown amount of COVID credits that remain unused by travellers who had booked travel over the pandemic.
Joyce confirmed that the $370m figure in outstanding credits only accounts for Qantas bookings, not Jetstar or overseas bookings. When pressed on the complete figure by Labor Senator and former boss of the Transport Workers Union, Tony Sheldon, Tully said that Jetstar’s unused credits were around $100m, of which over half of this figure came from bookings less than $100.
Andrew McGuiness, the group executive of corporate affairs at Qantas, admitted that neither of the three had the full figure with them on the day for credits.
“You’re not sure, my goodness,” Sheldon replied.
Joyce later said a big problem the group was facing in regards to getting travellers to use their COVID credits was those credits held via travel agents.
Tully said that, “We’re working really hard with our travel agent community” to get their clients to use credits.
Sydney Airport slots
Joyce denied that his group strategically cancels flights out of Sydney Airport to block its rivals, blaming air traffic controllers instead.
“Isn’t it true that Qantas actually has no intention of flying those flights and that you are indeed hoarding slots in and out of Sydney?” Joyce was asked by the senate.
When interrupted in his answer with a follow up about specific month on month cancellation rates he replied: “there are supply chain issues … with air traffic control delays … Air traffic control had a lot of people leaving the industry.”
He went on to say that the high cancellation rates from Sydney come as the airline prefers to cause less customer inconvenience.
“To disrupt less customers, the easiest thing we can do is to concentrate the cancellations on a high frequency route like Melbourne-Sydney, because that means that there’s a flight every half hour we can re-accommodate people on [to].”
Massive profits + bonuses
The group CEO defended itself against “criticism of corporate profits” amid cost-of-living pressures rising.
“There’s a lot of criticism of corporate profits at the moment, due in large part to the cost-of-living pressures happening in parallel. We understand that,” Joyce said.
Later, Senator Sheldon heavily criticised Joyce’s $25m bonus and asked if he felt embarrassed about receiving such a profit after lowering the wages of workers within the airline. Joyce replied with some context about how the airline suffered throughout the pandemic and discussed how the airline is getting itself back to higher levels of customer satisfaction.
“You are one of the most complained about companies in Australia, and you are trying to say to me that there is no problem here?” Sheldon replied. Joyce replied that he was “not.”
Among these topics, Qantas’ reputation, whether it lobbied against high-speed rail and more were discussed at the inquiry.
