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Thursday, 27 November 1986
Page: 3858

Mr MARTIN(1.28) —At the outset, I must say that I am pleased that the honourable member for Murray (Mr Lloyd) has indicated that the first half of the motion that has been put forward today by my colleague the honourable member for Isaacs (Mr Charles), is supported by those on the other side. I am pleased that in fact it is a unanimous view, I would suggest, in this House, that both Qantas Airways Ltd and Australian Airlines have contributed significantly to the Australian economy, in very recent times particularly. However, I am disappointed but not surprised, as I continue to say in debates in this House, at the attitude of those opposite with respect to the subject of the second part of the motion-whether public or private ownership of Australian Airlines and Qantas is a good or a bad thing. I would like to address some of the points that have been raised and answer a little later some of that the honourable member for Murray has raised. It is worth just recounting some of the performance characteristics of Qantas, in particular, and Australian Airlines over the last few years. As my colleague the honourable member for Isaacs has indicated, Qantas contributes some $4 billion a year to the Australian economy. That contribution is expected to increase significantly in future years. Our international airline is already one of Australia's top export industries. The examples that the honourable member for Isaacs gave clearly demonstrated that. In terms of tourism, Qantas contributes some $1.5 billion to Australia's economy each year. This clearly demonstrates the reason for the importance that the Government attaches to Qantas and Australian Airlines. If we combine Qantas's overseas sales with the amount spent in Australia by overseas tourists, we see that our international airline is Australia's fifth biggest single export industry. I think that encapsulates exactly what we are talking about.

As far as performance is concerned, let me very quickly give the House a few statistics. Qantas ranks among the top 50 airlines of the world. It is first in passenger journey length; it is first in average flight stage length; it has the seventh highest revenue payload per employee; it has the seventh highest production per employee; it is the tenth biggest producer of international traffic; and seventeenth biggest revenue payload carrier. I submit that all of these statistics clearly indicate that Qantas performs an extremely valuable task for Australia and, because of those very factors, anyone who considers that it should be sold into private ownership really has not put forward what I consider to be a viable argument.

I suppose that directly brings one to some consideration of the points that were raised by the honourable member for Murray and also, generally, to the Opposition's aviation policy which, as he has indicated, did fall into the hands of the Minister for Aviation (Mr Peter Morris) some months before it was re-released. In fact, I understand that it was re-released somewhere around 12 August 1986, when the Liberal-National coalition announced that if it came to office it would sell Qantas. The Opposition's announcement indicated that clearly the Liberal and National parties were also prone to sell off Australian Airlines to private operators. Let us strip away some of the myths about this and get down to facts. I think it important that we do that. Firstly, I would ask the honourable member for Murray, in elaborating his contention that Qantas and Australian Airlines should be partly sold into private ownership, to tell us what proportion it is proposed to sell into that private market.

Mr Blunt —Forty-nine per cent.

Mr MARTIN —So a coalition government would retain 51 per cent and 49 per cent would go to private ownership. Honourable members opposite are suggesting that the myriad of private owners who would jump at the chance to come along and purchase Qantas shares would be the employees; that then all of these other people who dabble in the stock market-perhaps the little old ladies the Opposition talks about who have their money invested in BHP shares; there are not too many who support those on this side-would participate. I put it to honourable members that that is a fallacy; that the 49 per cent private interest, if it were offered, would quickly be sought by major owners of capital in this country. They perhaps would not even be from this country. I have not heard clearly stated that the coalition would not allow overseas interests to come into this particular area. I see that the honourable member for Fadden (Mr Jull) is shaking his head. I am pleased that he may be able to clarify that point because it is very important.

The reason that I think it is important is that the honourable member for Murray made reference to Singapore Airlines selling off major proportions of its equity, by inference to people within Singapore and remaining very much a national type of entity. Interestingly enough, Singapore Airlines at present is 77 per cent owned by Tamersak Holdings, a government-owned corporation. The balance is held by employees under a share incentive scheme. So I would agree that in a case like that one is talking about a majority interest remaining within the country itself. I applaud that. I think that is exactly what we are talking about on this side. In the debate on privatisation versus public ownership, we are trying to ensure that Australian ownership remains. I hope that we can get agreement from the other side that indeed that is what they are on about. The interesting thing about the Singapore Airlines example is that Tamersak Holdings, which as I have indicated is a Singapore Government-owned corporation, is currently endeavouring to reduce its 77 per cent holding to 63 per cent, with 25 per cent of that proportion being offered to international markets.

What greatly concerns me in this debate is this: If we are talking, in the process of discussing privatisation, about selling off those assets which the Australian people already own, are we proposing allowing foreign equity ownership of Qantas, one of the major revenue earners for the people of Australia? Are we to allow foreign ownership of Australian Airlines? I take the point that has been raised by the honourable member for Murray in respect of the position that Mr Murdoch presently holds and the question mark as to whether he is to be categorised as a foreign citizen who owns part of an Australian airline, but I would be loth to take that too far because I could not see much space being obtained in the Australian or Sydney Daily Telegraph if one wanted to pursue it. Nevertheless I ask the Opposition whether it can give the Australian people a clear assurance that, in pursuance of its policy of selling off things that the Australian people own, it is not proposing that foreign ownership be allowed in. Again, the honourable member for Fadden is shaking his head. If he is in agreement with that perhaps he rather than the honourable member for Murray should be on the front bench speaking on behalf of the Opposition on this matter.

It really comes down, I suppose, to a consideration of what privatisation is all about. It also brings into consideration just what has occurred in the three and a half years since this Government came to office and what it has been able to achieve for both Qantas and Australian Airlines. I think it is worth reflecting on that because it brings us back to a further consideration of public versus private ownership. When the Australian Labor Party came to government some years ago Australian Airlines was almost bankrupt. It required a $90m capital injection. I wonder whether, under the privatisation policy of honourable members opposite, they would have worried about that if the airline had been in private hands. Would a Liberal-National Party government have done anything about it or would it have been prepared to see the airline quietly disappear and perhaps Ansett buy it out? What would we have been left with in this country? We would have been left with a monopoly. I do not think that anyone can seriously suggest that that would be in the interests of anyone in Australia, least of all those who use public air transportation. In addition greater commercial freedom and responsibility were given to Australian Airlines management. Cost cutting programs were initiated and clear Government guidelines were laid down. As a result, although a loss was shown in 1982-83, within 12 months, a profit was achieved. In fact, in the last two years the profit margin has shown considerable improvement. Australian Airlines, through its image change through adopting its new name and through a range of other improvements such as better service, has continued to attract customers. I know that on occasions the honourable member for Richmond (Mr Blunt) travels on Australian Airlines because I travel exclusively on it and have sat next to him. We have discussed this and a number of other issues and I know that he endorses what I am saying. We have seen that in recent times the improvements effected have attracted more customers back to it. It has decided to purchase new Boeing 737-300 aircraft, the first of which is already in service. We have seen a new commercial confidence in evidence in the organisation.

As far as Qantas is concerned, again under this Government an initial $60m in additional equity has been provided. In May 1984 new guidelines were laid down for the directors to give the company greater freedom and flexibility in managing its commercial activities. Again, this Government is not in the business of standing over Australian Airlines or Qantas and saying `This has to be done in a particular way'. They are given commercial freedom-freedom which they just would not get in any different sense in the public forum, through public ownership. It is just nonsense to say that the contrary is the case. What has been the result of this added commercial freedom? There are some very interesting statistics to which I will go quickly. As to profit or loss before tax on operations, in 1980 Qantas lost $6.99m; in 1981 it lost $37.09m; in 1982 it lost $20.17m; and in 1983 it lost $47.44m. Which party was in government then? It was not the party of those who are on this side of the chamber. We came to power and in 1984 a profit of $58.3m was achieved; in 1985 $62.7m; and in 1986 $44m. Honourable members opposite are trying to tell us that public ownership will achieve a better result. That is absolute nonsense, humbug, and should be shown for what it is.

To return in a general sense to this question of whether public or private ownership is worthy of support, and just in what way we should go, I had thought this was an issue that had died off a little for the Liberal and National parties; that they had decided to let the old privatisation issue die a natural death. Honourable members will recall, I am sure, that back in 1985, when it was put on the front burner and turned up a bit, articles were written and great examples from Margaret Thatcher's Britain were quoted. Then, suddenly, people started to say: `You blokes over there do not know what you are talking about'. No interest was shown in what honourable members opposite were doing because people realised the potential dangers. It was a great con job. Honourable members opposite were trying to suggest selling off assets which the Australian people already owned. Qantas and Australian Airlines are prime examples. Even people in the coalition's own ranks were saying that it was a load of nonsense. Who could ever forget the famous John Valder tape, in the course of which he made a number of comments on privatisation and other issues. He called privatisation `fiddling with the edges' and I agree with him. On 23 August 1985 the honourable member for Boothby (Mr Steele Hall) was very forthright in a speech which he delivered at, of all places, the Canberra Grammar School. Why the school was concerned with the privatisation of the airline industry I am just not sure, but he went on to question whether it was a reasonable thing to even consider. He said

. . . a government of any colour is unlikely to get extreme legislation through Federal Parliament.

Imagine, therefore, some of my more conservative colleagues trying to get a Bill through the Senate to sell the Commonwealth Bank or to float off Australia's international flag carrier, Qantas.

They can have a few token authorities to satisfy their appetite-they can get rid of the rundown, or the obsolete-but they can't and should not get their hands on the `Get with the Strength' elephant, or the `Flying' kangaroo. I think we can be sure the Senate will see to it that they don't.

I agree with that comment, I think that it is as true today as it was then. Of course, the former Leader of the Opposition, the honourable member for Kooyong (Mr Peacock)-I will be interested to know whether this will be his policy in another couple of months-went on to say that he would embrace this whole concept of privatisation only if it was in the best interests of the taxpayer and the consumer. We on this side of the House submit that it would certainly not be in the best interests of the Australian people to consider selling off either Qantas or Australian Airlines.