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Tuesday, 4 October 1983
Page: 1243


Mr REEVES —My question, which is addressed to the Minister for Aviation, relates to the current strike by Australia's domestic airline pilots. Is the Minister aware of claims by the Australian Federation of Air Pilots that the Government has not adequately addressed the pilots' concern with the Government's new arrangement for the taxation of lump sum superannuation payments? Will the Minister advise the House of the Government's response to the current pilots' strike and of the response that the Government will take if the pilots embark on further industrial action to disrupt Australia's airline services?


Mr BEAZLEY —I am aware of the statements reported in the Press that have been referred to by the honourable gentleman. The first point I make about that is that the pilots have had a series of meetings with the Government at which aspects of the superannuation scheme as it relates to them have been gone into in very considerable detail. We have in fact had seven meetings with the pilots involving, at different points of time, the Treasurer, the Prime Minister, myself, the Minister Assisting the Treasurer and officials from the Treasury and the Australian Taxation Office. As a result of discussions we have held with them and with other members of the trade union movement and the Australian Council of Trade Unions, very substantial alterations have been made to the superannuation scheme.

A matter of particular concern to the pilots which they raised with us and which, in the early meetings at least, they emphasised with us consistently was the question of the upper bands that were originally proposed in the May statement whereby at a particular point for a particular lump sum payment tax went from 30c to 46c and ultimately to 60c. Those bands were removed. They were removed, at least in part, because of the representations made to us by the pilots. The pilots have had a very fair crack of the whip from the Government in terms of their ability to get through to us the points that are of most concern to them.

In addition to that, we have said to the pilots throughout the period leading up to this strike, and still say to them, that we are fully prepared to discuss with them the detail of the scheme as it affects them and matters related to the generality of a retirement package, annuities and indexed bonds, if they wish to address us on them. But the position we adopt is that the fundamentals of the scheme are in place and have been agreed to, at least substantially, by all sections of the trade union movement and by those who have been looking at this question. We will implement that scheme. We will not be moved on that question by threats of industrial action or by industrial action itself.

The pilots address us as though they are confronted with a situation of great urgency. As a result of the decisions that we have already taken, I submit that that is not the case. They have plenty of time to address with us the development of appropriate annuity schemes because the impact on their very substantial superannuation payouts will be minimal for a considerable period. I will table figures to that effect, but first I draw the attention of honourable members to a number of facts. Under our proposals an Airbus captain of 30 years standing retiring in 1985 will receive a lump sum payout of $413,000, of which about $14,000 will be removed in tax.


Mr Porter —You would pick on an Airbus captain.


Mr BEAZLEY —Even by the year 2005, if that captain takes absolutely no means to protect himself in any way, he will be paying 16.4 per cent on a lump sum payout of $614,000. There is no urgency there. An honourable gentleman opposite has queried my using an Airbus captain as an example and asked implicitly why I do not address myself to some of the others. The fact is that most Trans Australia Airlines pilots are retiring at Airbus level. But, since the question has been raised, let us suppose that a captain retires at 727 level. In 1985, after 30 years service, that person will receive a payout of $367,000, of which $13,000 or 3.5 per cent will be removed in tax. The same person retiring in 2005 will have 16 per cent removed from a payout of $545,000. We are talking in present day dollars. What is quite evident from all that is the very slow pace in the real effect of the Government's superannuation scheme. It is not a pace which would justify in any shape or form the degree of urgency that strike action implies. I table those charts.

As a result of that action the travelling public is being dramatically inconvenienced. In addition, the airlines are being severely damaged. As I have said before in this place and elsewhere, publicly, there has been upwards of a 10 per cent downturn in airline traffic at this time over the equivalent period last year. Traffic is now substantially below levels in 1977 and 1978 when the current fleets of the two major airlines were put in place. They were put in place on an assumption of an increase in traffic of at least 5 per cent per annum. That puts the airlines that are already experiencing serious financial difficulties at even further risk. A two-day strike amounts to a loss to those airlines of some $4m. What cannot be calculated is the loss of confidence on the part of members of the travelling public that they will receive the services they pay for at the time that they are booked. The effect of that, of course, is incalculable; nevertheless, it is substantial.

There is a growing feeling in the country as a result of this action that if one books ahead for a trip it is uncertain whether that trip can be taken. This Government and previous governments have been very generous to the two airlines and the airline employees who operate the system. They have implemented a highly protected industry which has guaranteed employment for the people within it at a standard which is absolutely unprecedented anywhere else in the world. That is what is being placed at risk by the action of the pilots.

I hope very much that the pilots will acknowledge our preparedness to discuss with them matters of technical detail which are related to them in the scheme; that they will acknowledge our preparedness to discuss with them the question of a general retirement package; and that they will abandon this industrial course of action and assume, as would any other members of the community, that when they have a degree of disagreement with the Government, any campaign is undertaken on a sensible political basis and not by industrial action. That is the position that this Government adopts and will continue to adopt. It is essential that the pilots adopt it also if the airlines are to survive this period of economic crisis and members of the travelling public are to be properly served.