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Airlines doomed under labor: Moore



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MEDIA RELEASE

JOHN MOORE M P SHADOW MINISTER FOR

BUSINESS, PRIVATISATION AND CONSUMER AFFAIRS

AIRLINES DOOMED TINDER TABOR 1 MOORE

Australia's airlines will never be privatised under the ALP, according to John Moore, Opposition Privatisation Spokesman.

While the ALP soul searches, our airlines are deteriorating.

Each week the Minister responsible for rescuing our airlines from extinction (Mr. Willis) appears on Sunday television floating a new brainwave - each more ludicrous than the next.

Firstly it was partial privatisation...then it was a Qantas-Australian merger...and the latest involves a complicated scheme to issue non-voting shares.

The Minister has irresponsibly floated proposal after proposal without any understanding of the marketplace

and the needs of the airlines.

Confusion reigns in Government ranks - and the airline industry.

This week's scheme floated by Willis means the airlines will continue in a state of financial uncertainty.

Mr. Willis proposal is very sketchy - indeed it's not clear that even fcQ understands his own proposal.

COMMONWEALTH

P A R L IA M E N T A R Y LIBRARY MIC AH

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John Moore said the crucial question was, "Will the issued shares be convertible or non-convertible?"

Moore said that if capital raisings don't include a

conversion right into ordinary capital, they can't be regarded as equity.

For example, redeemable preference shares are treated as debt instruments, and are therefore absolutely inappropriate for the airlines.

That type of share issue would mean the worst possible scenario - a deterioration of the airlines' debt/equity

ratio.

If Mr. Willie intends using convertible shares, then this is really "back-door privatisation" - which is not allowable under ALP policy.

Everyone knows that full blooded 100% privatisation is

the only solution, but the ALP left wing has ruled it

out.

No amount of financial fiddling proposed by Mr. Willie

can solve the capital funding needs, achieve greater efficiency, provide consumer benefits, and enable

employee share ownership.

18 September, 1989 (07) 371-0644 or (062) 77-4134