The federal opposition has accused the Albanese government of “running a protection racket” for Qantas, as it questions the decision to block Qatar Airways from almost doubling its flights to Australia.
The government has in recent weeks defended its decision to reject a request from Qatar to fly an additional 21 services into Australia’s major airports, beyond the 28 flights a week it currently operates under existing bilateral air rights.
The treasurer, Jim Chalmers, has defended the decision made by cabinet colleague and transport minister Catherine King as being weighed up “in the national interest”.
But on Friday afternoon, the opposition transport spokesperson, Bridget McKenzie, called on the treasurer, Jim Chalmers, to instruct the Australian Competition and Consumer Commission to investigate international airline competition and pricing.
McKenzie also called on the government to respond to the 2021 Harris review into demand management at Sydney Airport, which echoed pleas from a broad coalition of aviation groups for an overhaul to the slots system. Critics say the system is leading Qantas, Jetstar and Virgin to strategically schedule then cancel flights to shut out competition.
“The Government has the opportunity to make some immediate decisions that will put downward pressure on airfares, and improve reliability and competitiveness,” McKenzie said.
She said the decision to refuse Qatar’s request “makes little sense, particularly when we’ve seen the cost of international flights in some cases treble in the last couple of years”. McKenzie claimed allowing it would put “downward pressure on airfares”.
McKenzie said King had provided varying reasons for rejecting the request, including wanting “to help Qantas afford to buy new planes”.
“This government seems to be running a protection racket for a major domestic carrier by refusing to increase competition and freight capacity,” McKenzie said.
Earlier on Friday, the opposition leader, Peter Dutton, told Nine’s Today show on Friday questions remained over why the Gulf carrier’s attempt to offer additional flights had been knocked back given it would help ease the “astronomical” cost of airline tickets.
“I‘ve got real questions over the Qatar decision. We’ve heard no coherent reason from the government,” Dutton said, pointing to recent reporting about the issue in the Australian Financial Review.
“Anyone flying to Europe or Asia or the Americas at the moment realises that the prices are astronomical, so more competition and more flights on those routes will help.”
The calls for a “please explain” come as Qantas posted a record $2.47bn full-year underlying profit on Thursday.
Chalmers was asked on ABC’s Radio National whether he conceded blocking Qatar’s bid benefited Qantas’s bottom line.
“What we’re asked to do, whenever it comes to these bilateral agreements about flights and about capacity, is to judge it against the national interest and that’s what the transport minister has done in this case,” he said on Friday.
Chalmers added he did not think the call to block Qatar’s extra flights was anti-competitive.
“I think one of the big misconceptions about what’s happening here is that somehow this is preventing extra capacity from being in the system,” Chalmers said.
“What we’re seeing is Cathay Pacific, Singapore Airlines, China Southern – a whole bunch of these airlines are adding extra capacity, extra international opportunities, and that’s a good thing.
“That’s one of the benefits I think of the fact that our tourism sector is recovering so we’re seeing more flights, we’re seeing more routes. Transport ministers make these kinds of decisions from time to time, they weigh up the national interest and they make the call.”
Qatar Airways currently flies 28 weekly services into Australia’s four major airports – daily services into Sydney, Melbourne, Brisbane and Perth – as well as an additional seven into Melbourne via a loophole that forces it to run an onward near-empty flight to Adelaide each day.
The Albanese government rejected Qatar’s request to expand its bilateral air services agreement to allow for a further 21 weekly services to the major airports, citing a variety of reasons including the “national interest”, as well as local jobs, and, more recently, Qantas’ investment in new aircraft.
On Thursday, as Qantas posted a record $2.47bn profit, its chief executive, Alan Joyce, defended his airline’s opposition to Qatar’s desired expansion.
“There seems to be a focus on Qatar and people are missing all of this extra capacity,” Joyce said, noting airlines from China and Singapore had in recent months added more flights – capacity already allowed under existing bilateral agreements with those countries – in excess of Qatar’s request.
Joyce also said Qantas had lobbied against Qatar’s request because, at a time when the international aviation market was lacking capacity, almost “doubling those rights could actually distort the market”.
Earlier this week, a parliamentary inquiry heard criticisms from Rex Airlines, Sydney Airport and the Australian Airports Association that major airlines are misusing slots to shut out competition, leading to high flight cancellation rates.
Neither the former Coalition government nor current government has adopted the recommendations from the 2021 Harris review. King has deflected resisted calls to urgently reform slot system ahead of the government’s white paper process.
