Virgin Australia chief executive Jayne Hrdlicka has told a senate committee that ending JobKeeper for the aviation industry in March would be “devastating”.
In the most significant intervention yet from a senior industry figure, Hrdlicka added it might be “impossible” for the business to “bear the financial cost” of operating in a market where borders are opening and closing without warning.
“We cannot predict when it will end,” said Hrdlicka. “We don’t know whether we have two more years to go. We don’t know whether we have two weeks.”
JobKeeper payments are set to end nationwide at the end of March, and Prime Minister Scott Morrison has remained tight-lipped as to whether it would continue for some affected industries.
Hrdlicka was speaking to the rural and regional affairs and transport references committee investigating the ‘Future of Australia’s aviation sector, post COVID-19’ on Friday. Her comments were recently released via a transcript.
“We’re still working through exactly what we will need to do [if JobKeeper is not extended] but, you can imagine, it will be devastating,” Hrdlicka said.
“We’ve got 3,000 highly skilled workers who are currently stood down and, as borders open, we bring them back in and they get hours, and they’re very happy to be back at work; then, when the borders shut, we have to stand them back down.
“The JobKeeper program, that wage support, enables them to stay whole and not be economically unstable as individuals or families in the process.
“The implications of losing those skilled workers are pretty significant. When the announcement was made, for example, yesterday that Queensland would open with New South Wales, we’d already got people rostered on, in the hope that the borders would open, and, then, we have to cancel flights back when the borders stay closed.
“So we’ve got people ready to go. We will be flying more flights between Queensland and New South Wales, pretty much, overnight, starting Monday and we’re in a position where we can support the economy.
“If we did not have those people stood down and ready to go, it would take us weeks to get people identified to come back in, figure out who’s working and who’s not working and get them back in. They would all have to be retrained, in order to meet our regulatory requirements, and the volume of people that we would require, to be able to do that, means it’s months to get stood back up and to get the capacity to support the demand.
“We’re quite conscious of how important it is for us to have that resilience and support and stability. Financially, to do that ourselves, it would be a devastating thing, because we cannot predict when it will end. We don’t know whether we have two more years to go. We don’t know whether we have two weeks. So it’s an impossible thing, to bear the financial cost of that resilience and flexibility to support the economy.”
Hrdlicka’s plea was made shortly after an industry open letter was sent to the Prime Minister urging an ‘Aviation Keeper’ payment.
It was signed by the businesses Virgin Australia, Menzies, dnata, Gate Gourmet and Swissport and the unions the TWU, ETU, AMWU, ALAEA, FAAA, AWU, VIPA and AFAP.
The JobKeeper package was introduced to provide coronavirus-effected business with an initial $1,500 per employee, per fortnight.
Companies are then legally obliged to pass that payment onto workers in a bid to keep the economy active during the pandemic.
However, the scheme has proved problematic for much of the aviation industry.
Many airport workers, such as those at Newcastle, 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.