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.
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.
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.”