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Willis Misleading on Qantas Sale

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Senator Jim Short Deputy Leader of the Opposition in the Senate Shadow M inister for Finance & Assisting the Leader on Commonwealth/State Relations

27 September 1992 SMF85/92


At the very least, Finance Minister Willis gilded the lily with his comments on the 'Business Sunday1 program today on the proposed sale of Qantas.

At worst, he seriously misrepresented the real situation, and showed a cavalier disregard for the budgetary implications if the sale is not concluded this financial year.

Mr Willis claimed the sale was on-track, and had never been off-track.

This is nonsense. The government's policy on the sale of Qantas and Australian Airlines has changed three times in the last 12 months. This has totally disrupted earlier sale plans.

A year ago the Department of Finance told me in Senate Estimates Committee hearings that the sale for each airline was proceeding satisfactorily. Less than 3 months later the whole sale strategy was turned on its head. It was further totally upturned by Prime Minister Keating's announcement on TV in June, without any prior Cabinet consideration, that Qantas would buy 100% of Australian Airlines, and would then be sold off 100% - despite the fact that it was, and still is, official ALP policy to sell off only 49%. .

It is clear from last week's Senate Estimates Committee hearings that it is by no means certain that the sale will be completed in 1992/93. Even the Qantas Chief Executive, Mr Ward, acknowledged this recently.

Finance Minister Willis was positively cavalier today about whether the Qantas sale proceeds - with the sale of Australian, estimated at up $1.6 billion net - would actually be received in 1992/93. These proceeds are an important part of the Government's 1992/93 budget calculations. Without them the budget deficit would be $15 billion rather than the published $13.4 billion. Likewise, the Government's borrowing requirement would be over $20 billion, rather than $18.5 billion foreshadowed in the Budget.

Minister Willis said on the 'Business Sunday' program today that it would not matter much if the proceeds were received in 1993/94 rather than this financial year. Such a statement makes a mockery of the Government's 1992/93 Budget policy, and demonstrates yet again the fiscal incompetence of this Government.

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