Mr JULL (2:08 PM) —My question is directed to the Prime Minister. What contact has he had with his New Zealand counterpart in terms of the financial difficulties of Ansett Australia and any consequences to Air New Zealand?

Mr HOWARD (Prime Minister) —In recent times I have had two conversations with the New Zealand Prime Minister. I spoke to her briefly last Friday evening to express my regret on behalf of the government at the discourtesy that was displayed towards her at Melbourne airport. I repeat to the House that, no matter how deep and understandable may be the feelings of the Ansett employees and others in the Australian community about the behaviour of Air New Zealand, that is no justification for behaving in such a discourteous fashion towards the Prime Minister of a country with whom Australia has long had a very close and important relationship. It is because I have become concerned about the impact of this issue on the bilateral relationship that I rang the New Zealand Prime Minister this morning. I said to her that it was important that both of us worked to ensure that the issue of Ansett and Air New Zealand did not contaminate our bilateral relationship.

I would remind the House that on earlier occasions there have been corporate collapses in Australia which have hurt New Zealanders. I think that it is very important to separate the merits of this issue from the bilateral relationship. Having said that, I made it very plain to her that there was very deep anger in the Australian community, particularly among Ansett employees, regarding the behaviour of Air New Zealand. I reaffirmed to her the position of the Australian government that had been maintained throughout by the Deputy Prime Minister, by the Treasurer and, where appropriate, by me that we could not make any equity injection into Ansett and we could not be engaged in a bailout of Ansett.

I did, however, inform the New Zealand Prime Minister that we would be willing to guarantee the payment of the workers' entitlements in the terms outlined by my colleague at a press conference this morning—he, incidentally, having been denied the opportunity of outlining the government's position at a meeting convened by the ACTU. The purpose of the government's actions is to try and provide assistance to the employees of Ansett, not to politicise this dispute. I explained to the New Zealand Prime Minister that we would guarantee all of statutory entitlements, that is, unpaid—

Opposition members interjecting—

Mr SPEAKER —The Prime Minister is entitled, as all members know—all members are similarly entitled—to be heard in silence.

Mr HOWARD —I indicated to the New Zealand Prime Minister and I indicate to the House that it has been the position of the government to guarantee the statutory entitlements, that is, the unpaid salary, anything in lieu of notice that is appropriate, long service leave and unpaid holiday pay. In addition to that, we are also prepared to guarantee the payment of up to eight weeks redundancy, which is the community standard.

I might say rhetorically that that is a great deal more than I understand would have been done under the policy in relation to workers' entitlements for the 1,000 employees of Compass. I do not remember there being any bailout by the Keating government of the Compass employees. In fact, I am reminded in the context of Compass—

Opposition members interjecting—

Mr SPEAKER —It is evident that members on my left do not believe that the chair will reinforce the standing orders. I indicate to everybody my intent to ensure that the Prime Minister and all participants in question time recognised by the chair are heard in silence.

Mr HOWARD —I am reminded of a comment made by Brian Gray, the former chief executive of Compass Airlines on 22 December 1991. He said:

That was the attitude. If you think that that is just relying on the verbatim of the former chief executive of Compass, let me also quote from the former minister himself when the request had been rejected:

They were the words of the Labor minister. Let me return, because I think it is relevant to do so, to the discussion that I had with the New Zealand Prime Minister. I made it plain to her that we would fund the payment of the workers' entitlements and, as will be revealed over the days ahead by the minister responsible, we will make arrangements so that, as soon as the individual claims of employees of Ansett can be properly assessed, we will begin making payments of those entitlements where there is a legal obligation to do so. We will do it, and it will cost—

Mr Brereton —You're robbing them blind.

Mr HOWARD —The member for Kingsford-Smith implies that we are fobbing something off. It is going to cost $400 million. It is some fob-off to pick up to the tune of almost $400 million the entitlements of the Ansett employees! That is a far more generous thing done by this government in relation to any group of employees than to any other group of employees of any company, including, might I say, a company that keeps getting referred to me by those opposite because on that occasion—and I know they are referring to National Textiles—the full payment was made possible by the contribution of the New South Wales Labor government, which matched dollar for dollar the contribution of the federal coalition government. So, if those who sit opposite want the situation to be completely duplicated, they should approach Mr Bracks and Mr Carr to make up the additional redundancies. I think that would be an extremely good thing to do.

I know that there are many on this side of the House who would like to hear the next part of my report to the House of my discussion with the New Zealand Prime Minister. I not only informed her of my intention and the intention of the government to pick up the statutory entitlements and the redundancies up to a community standard of eight weeks but also said to her that that was being done without prejudice to the right of the Australian government—as it would, standing in the shoes of the employees and becoming the creditor of Ansett Australia—to institute legal proceedings against Air New Zealand in order to secure recoupment, on behalf of the Australian taxpayer, of the amount that we are going to lay out to see that the Ansett workers are not left out in the cold. I have made it very plain that our legal rights are fully reserved. What we have done is entirely without prejudice to the right of the Commonwealth government, as it will stand in the shoes of the former employees of Ansett, having paid their entitlements, to recover the amount.

In the meantime, it is the intention of this government for proper reasons of financial prudence to introduce a ticket levy in order to fund—I hope, on an interim basis, because I am hopeful that recovery will be secured from Air New Zealand—the cost of paying the entitlements of the Ansett employees. I agreed that it was in everyone's interests that Air New Zealand remain fully viable. There is nothing to be achieved by trade unions in this country or anywhere else boycotting Air New Zealand. All that will do is imperil the jobs of workers in New Zealand and imperil the viability of an airline at a time when, because of the tragedy in the United States, airline travel is under tremendous pressure and the bottom line in the viability of airlines all around the world is under enormous pressure. This is the last conceivable occasion on which anybody with any jot of responsibility would seek to impose a boycott on an airline.

No matter how deep may be the feeling, to impose a boycott on Air New Zealand would be the height of irresponsibility. But it is not the height of irresponsibility for a government to do what we have done in relation to Ansett employees' entitlements. We are the only party to this dispute that has put money on the table. The Australian government is prepared to put $400 million of taxpayers' money on the table. We are prepared to recoup that money through a levy. We will pursue, if we are legally able to do so, Air New Zealand to secure reimbursement. In those circumstances, I would say to the opposition: instead of encouraging the ACTU to deny free speech, you ought to try to cooperate with us in settling the dispute.