Mon Oct 9

Senate committee says government should 'immediately review' its rejection of Qatar flights

Written by Michelle Grattan, Professorial Fellow, University of Canberra

A Senate inquiry into the Albanese government’s refusal to agree to the extra flights sought by Qatar Airways has recommended the decision be immediately reviewed.

The inquiry’s report, tabled Monday, is also sharply critical of Qantas, whose executives came under hostile questioning over its treatment of customers, when they appeared before the committee.

In its majority report the committee, chaired by the Nationals Senate leader Bridget McKenzie, asks the Senate to re-appoint it so it can bring before it former Qantas CEO Alan Joyce, who declined to appear saying he was overseas. This will require a Senate vote.

Qantas opposed the Qatar application, on the ground it would distort the market.

The report criticises Transport Minister Catherine King for not clearly articulating the factors in her decision not to approve the Qatar application. She has maintained she acted in the “national interest”, and given various reasons at different times.

“A wide range of witnesses, including key stakeholders in Australian aviation, submitted that they did not fully understand the basis for the decision,” the report says.

“The weight of evidence before the committee indicates the national interest would have been well served by agreeing to Qatar’s request.” The report also criticises the government’s refusal to provide the committee with information it sought.

Evidence suggested the decision cost the economy a loss of up to $1 billion; it was also a missed opportunity for tourism and trade, particularly agricultural exports that use passenger planes, the report says.

The inquiry recommends that in deciding on bilateral air agreements, the government should look at a cost-benefit analysis, consult widely with stakeholders including the Australian Competition and Consumer Commission, and publish its reasons for decisions.

In the wake of the government’s rejection, Qatar has asked for consultations.

King responded to the report by denouncing the inquiry as a “political stunt” by the Coalition. The committee has repeated its request to King to appear before it, which she has declined to do.

The committee comprised three Coalition senators, one from the United Australia Party, two from Labor and one from the Greens.

In their dissenting report Labor senators Tony Sheldon and Linda White said many of the majority recommendations “appear blissfully ignorant of the current policy framework underpinning Australia’s aviation sector”. Green senator Penny Allman-Payne also dissented on some issues.

The report recommends reinstatement of the monitoring of the airline industry by the ACCC.

It says that in addition to this broad monitoring of competition in aviation, “the committee would support a specific investigation by the ACCC into Qantas’ actions in the aviation market.

"The committee is concerned by evidence suggesting Qantas may be especially aggressive when seeking to maintain its market share. This muscular approach towards competitors and new entrants can compound the problems that are already caused by a lack of competition.”

The Qantas group has “significant steps to take to repair trust” with consumers, the report says. “The committee expects tangible improvements regarding their behaviour toward their customers.”

The committee recommends the government develop consumer protection reforms in the aviation industry as soon as practicable to address delays, cancellations, lost baggage and devaluation of loyalty programs.