Mildura chairman urges extension of JobKeeper after underspend

written by Adam Thorn | May 28, 2020
Mildura Airport
Mildura Airport is ineligible for JobKeeper payments because it’s council owned (WikiCommons)

The chairman of Mildura Airport has become Australia’s first airport boss to call for the JobKeeper scheme to be extended after it emerged the initiative is $60 billion under budget.

Peter O’Donnell told Australian Aviation, “We’ll get through this, but my concern is that the regional networks will be decimated because airports will be fundamentally without funds or bankrupted.”

He added that while, initially, his focus was on returning his terminal to the same standards when restrictions ease, now the objective is purely survival, having stood down more than half his staff after losing around 97 per cent of revenue.

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“We’re as operational as we can be but there are only five flights a week,” said O’Donnell. “Security staff are stood down and it’s hard to get good café people. When we do restart, we have to re-engage these people and hope they’re still around and available.”

The JobKeeper package was introduced to provide coronavirus-effected business with $1,500 per employee, per fortnight.

The companies are then legally obliged to pass that payment onto workers in a bid to keep the economy active during the pandemic.

However, many airport workers are locked out of the financial package because their firms are council-owned; while staff at dnata were similarly told they were no longer eligible because their company is owned by a foreign government.

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On Monday morning, Treasurer Josh Frydenberg told the Today program he accepted blame for the apparent reporting error, which means the aid package will only cost $70 billion and cover 3.5 million Australians, rather than $130 billion and 6.5 million as forecast. However, he insisted that there are no plans to open it up to more workers.

Mildura is Victoria’s busiest regional airport, and O’Donnell explained that while he supported extending help and supplements to airlines to maintain a network, it has put pressure on airports to keep going without similar funding.

“We are owned by the government but we’re a private company with one shareholder, which is Mildura City Council,” explained O’Donnell. “We’ve never gone to the council for operational support. We’ve been fully self-sufficient but we can’t access any of the support.

“It’s really frustrating. We understood we would take a massive revenue hit for a period. This would be finite, there would be a start and a finish to it and then a recovery. We decided we needed to one, build a plan to survive but then two, try to emerge at the end at least as good an airport as when we went into it. Now it’s only about survival. We’re trying to flatten our own economic curve to make our money last longer, but with minimal support from government.

“We’re looking for an amount we would otherwise have got through JobKeeper. We’re down 97 per cent in revenue.”

He said the mistake was a great opportunity for regional airports to say “We’re desperate, if you want to remove just one part of the rules, we can access it”.

Earlier this week, the TWU said there was now “no excuse” for the government not to extend JobKeeper to omitted airport workers after the underspend emerged, while the Labor MP whose constituency covers Sydney Airport told a press conference that ineligible employees “live in Australia, work in Australia, pay taxes in Australia and contribute to the Australian economy. These deserve the support of the Australian government”.

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13 Comments

  • Craigy

    says:

    It amazes me how many people seem to think that there is an extra 60 billion just sitting in the Governments bank account to be spent. I have news for you Mr O’Donnell, the Government would have to borrow the money to spend it.

  • Mark

    says:

    Maybe he should have been a bit more friendly towards GA. Everyone will continue to avoid the place after the lockdown is finished.

  • Beemer

    says:

    Just how many of us thing that there is $60 billion sitting around doing nothing. The $ 130 billion borrowed from somewhere needs to be repaid. So if it is under-spent, then the remainder should go back to the loaning entity. Surely the Government as well as the opposition would realise this would be the best solution.

  • Stretch

    says:

    Likewise, just amazed that people think it is cash in the bank to use. It is a 60 billion saving we as tax payers do not have to pay back at sometime , think how much interest that will save.

  • Jennifer Power

    says:

    Everyone knows the gov’t doesn’t have the money. It should have thought about that when it closed down the country and tanked the economy. Australians want to get back to work but CANNOT unless we open up.

    Vote OUT whoever stands in the way. Our children and grandchildren will not forgive us for succumbing to the fear. But they will have decades to think about it.

  • Steve N

    says:

    I guess Mildura Council will have to stump up & pay the wages. It’s a Council-owned enterprise.

  • CJ

    says:

    more insanity.

    Jobkeeper & jobseeker are far to generous.

    Those getting it, don’t want to go back to work.

  • Gary

    says:

    So Jennifer you would prefer that we kept the country open and suffered the COVID consequences? All economies have suffered during this crisis. We are one of the lucky ones that is coming out of the pandemic. Or do you believe it was all a rouge? I think we should count ourselves as one of the lucky countries. No-one said people were not going to feel the pain; however, decisions were made to keep us as protected as much as possible which thankfully has worked (do I need mention some other countries?).

    • Paul

      says:

      Gary, we need to get the country up and running again the longer we leave it the harder its going to be, already there are businesses that have closed up for good because of Covid.The risk is now very low of Covid spreading lets open up the boarders and get the country running again.

  • Adrian P

    says:

    A recent accident report had as a contributing factor to the accident was “had limited recent experience in the Cessna 441 and that probably led to a degradation in the skills “. Is any one out there concerned about degradation of skills and the safety risk of the industry restarting with staff who are no longer current. Surely Jobkeeper should not be sitdown money but a means for people to attend their work place for training to maintain and update their skills.

  • Allan Lehepuu

    says:

    The stood down Staff can access JobSeeker payments plus healthcare benefits plus energy rebates plus housing assistance.
    So it is as beneficial as JobKeeper
    All of this provided by Australian taxpayers.
    So be honest, it is not about the staff but about cashflow for Mildura Airport.

  • Bryan Gathercole

    says:

    Maybe use the millions of dollars you tell us the flying school there generates .

  • Hein Vandenbergh

    says:

    I’d have thought that café personnel and security staff would not be too hard to get, they seem to have taken a major hit in terms of available jobs. And, they’re likely to have stayed in Mildura, going to the big smoke would have been far too costly, as well as disrupting their supportive social networks. It’s amazing the excuses some people, read the O’Donnells of this world, will dream up to justify their shameless begging for a share of money which isn’t there – as some others here have pointed out.

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