Minister says Qantas’ state bidding war ‘worst of federalism’

written by Adam Thorn | September 16, 2020
VH-OEJ-departure1 v2
Qantas 747 VH-OEJ begins its farewell tour out of Sydney Airport (Seth Jaworski)

Federal Trade and Tourism Minister Simon Birmingham has slapped down Qantas’ attempt to start a bidding war between states for its relocated corporate headquarters.

“This has the potential to represent the worst of federalism and spark a wave of corporate welfare-seeking by big business if we have big companies just auctioning off their head offices to states and territories,” Birmingham said. “In the end, it’s taxpayers picking up the bill.”

The government’s intervention comes after Qantas said it would be launching a three-month review into where to base its non-aviation staff following thousands of job cuts.

Advertisement
Advertisement

On Tuesday, chief financial officer Vanessa Hudson even openly admitted that the business was looking for “potential incentives” from states to relocate.

Talking on ABC Radio Adelaide on Wednesday, Minister Birmingham said, “I’d have to urge caution from the states. This bidding war won’t create one extra job in Australia; it just shuffles jobs around Australia and certainly our focus federally is how we save jobs across the country and try to start to grow those numbers again.”

A Qantas spokesman said in response, “We have to look right across our business for ways to be more efficient. Under those circumstances, it’s hard to see why state governments responding positively is a bad thing.”

Already, NSW, Victoria and Queensland have made positive remarks towards Qantas’ overtures.

PROMOTED CONTENT

Earlier this week, Qantas announced a review into its office space and said “anything that can move” is “on the table”, including its facilities in Mascot, Collingwood and Brisbane.

The news came shortly after the airline announced 2,500 ground handling jobs could be lost in addition to the 6,000 jobs across the business already earmarked for cuts.

The three-month review will focus on non-aviation facilities, including the company’s leased 49,000-square-metre base in Mascot, Sydney, and Jetstar’s leased head office in Collingwood, Melbourne.

However, it’s also flagged that “some aviation facilities”, such as flight simulator centres in Sydney and Melbourne and a heavy maintenance facility in Brisbane, could move, too.

“The Qantas Group will remain one of the country’s largest employers and a major generator of economic activity, so we’re keen to engage with state governments on any potential incentives as part of our decision making,” said Hudson.

“As well as simply rightsizing the amount of space we have, there are opportunities to consolidate some facilities and unlock economies of scale. For instance, we could co-locate the Qantas and Jetstar head offices in a single place rather than splitting them across Sydney and Melbourne.

“Most of our activities and facilities are anchored to the airports we fly to, but anything that can reasonably move without impacting our operations or customers is on the table as part of this review. We’ll also be making the new Western Sydney Airport part of our thinking, given the opportunity this greenfield project represents.

“This is about setting the Qantas Group up for the long term as well as recovering from the COVID crisis. And we’re open-minded about the outcome. It’s possible that our HQ stays where it is but becomes a lot smaller, and other facilities consolidate elsewhere. Or we could wind up with a single, all-purpose campus that brings together many different parts of the group. These are all options we need to consider as we look to the future.”

Did you know that Australian Aviation Magazine comes digitally? Subscribe to Australian Aviation’s digital magazine for just $59.95 a year! Our app is available on mobile, tablet and PC devices! Subscribe now at australianaviation.com.au.

6 Comments

  • Rod Pickin

    says:

    It is essential business practice to continually monitor the costs associated with it’s existence and I am quite certain that QF has its finger very much on the ball in this regard but considering all that has transpired within the industry this year and with no clear picture yet on the radar I detect an aura of mischief making, maybe some bullying even mild panic emanating from AJ’s mahogany retreat. In addition, the report makes no mention of the costs involved both monetary and human with any move away from the current domain and to even consider moving the current heavy maintenance base from BNE beggars belief. Expand it yes, close it, nonsense. Clearly all thoughts are inward, reverse them AJ, think ahead; with long haul, you say expensive to operate, equipment indefinitely parked or grounded, crew by now out of validity QF does not have the ability to support the nation as is required. Maybe at this time, instead of trying to crucify competitors it is time to form a coalition say with VOZ who just happen to have a few B777-300ER and full support to fill the much needed gap. I guess not all will agree but on on thing, aviation wise for sure, we aint in a good place right now.

  • Nicholas Paul

    says:

    Silly comments and irrelevant.

    Several states have already expressed interest in hosting QF into the future.

    This is how the free market works.

  • Gary

    says:

    Qantas… equally as vacuous and attention seeking as most state premiers. They started in Longreach, they should move back to Longreach….

  • Vannus

    says:

    To Gary above…..

    QANTAS was founded in Winton……

  • Max

    says:

    “This is how the free market works”. What, through government welfare? This must then be the number one “silly comment” of all.

  • I really don’t know what Simon Birmingham is prattling on about. Doesn’t he remember the Federal Government competition between Western Australia, South Australia and Victoria for the chance to build the Canberra Class Assault ships (awarded to Victoria) or between these states to build the Hobart Class Air Warfare Destroyers (3) awarded to South Australia, or the competition to build the !2 offshore Patrol vessels (both South Australia and WA winning that Tender. In all these cases plus lots more examples the States have all vied to win by offering incentives yto the various bidders eagerly promoted by the Commowealth Government. It was OK then, why isn’t it OK now for Qantas??

Leave a Comment

Your email address will not be published. Required fields are marked *

Each day, our subscribers are more informed with the right information.

SIGN UP to the Australian Aviation magazine for high-quality news and features for just $99.95 per year