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Wednesday, 8 April 1981
Page: 1483

Mr CHARLES JONES(8.50) — Mr Deputy Speaker, chairmanship of the House of Representatives Select Committee on Tourism helped the honourable member for Bowman (Mr Jull) in one respect; that was to at least teach him something about what happens in tourism and aviation. Whilst I do not always agree with what he has to say in a debate on airlines and all that goes with it, at least he puts up some points of view that require an answer. In his concluding remarks the honourable member for Bowman talked about the two-airline policy. Which government was responsible for setting up that closed door type of industry? Which government created the two-airline agreement? Perhaps we should call it the Ansett agreement as the agreement was set up so that the Ansett organisation could go on printing money; that is what it amounts to. It was created by the Liberal-Country party Government of the Menzies era and it carried through until the Australian Labor Party was voted into government in 1972. In fact, the agreement was tied up so tightly that the Labor Government could not shift it. Let us face the facts of life. It was so tied up that it could not be shifted. The reason why it is being shifted today is that the Government is about to make it even better for Ansett than it is at present. That is the only reason why there will be a renegotiation of the agreement.

The honourable member for Bowman talked about the public getting a fair go. Which political parties stopped Trans-Australia Airlines from operating in Western Australia? It was done by the Liberal-Country party coalition. The then Opposition in this place used its numbers in the other place to stop the appropriate amendments, in the form of the airlines legislation that we put forward in 1973, from going through. Those parties are responsible for the people of Western Australia not getting a 25 per cent cut in the price of airline fares. I say to the honourable member for Bowman that it is easy to make such comments, but for God's sake have regard to the facts.

The allegedly terrible Whitlam Government introduced off-peak fares in the face of opposition from Ansett. Before that Liberal Ministers for Transport would not allow off-peak air fares to be brought in. When we came into government we gave instructions to the then Chairman of TAA, Sir Frederick Scherger, who completely and totally supported the concept of off-peak travel, to tell the other fellow-Sir Reginald Ansett is known in aviation circles as the other fellow-that TAA would be introducing off-peak fares from a particular date and that if he did not like them he could stay out of it. He had enough brains to come into it. One thing I will say about Sir Reginald Ansett is that when one has a fight with him one has a fight on one's hands, but he is a bloke who relaxes and enjoys it when he knows that something is inevitable.

I was interested in the comments of the honourable member for Bowman regarding East-West Airlines. It is a good airline and it should be given the opportunity of exploiting and expanding quite a number of the air routes in Australia. If it does set up a decent route and expands it, Trans-Australia Airlines and Ansett should be stopped from moving in and taking it over, as has happened on occasions. As far as the comments of the honourable member on the light aircraft flown in Queensland are concerned, Trans-Australia Airlines should be permitted to abandon the unprofitable F27 flights that it is compelled to operate in Queensland. Let me cite my own district as an example. When F27 aircraft operated between Newcastle and Sydney, there was one flight out of a morning and one flight in of an afternoon. A fellow by the name of Keith Hilder, with great imagination and initiative, attacked the problem by introducing light aircraft-Cessna 402 aircraft-with the result that today there are 24 flights a day each way between Newcastle and Sydney. There are more aircraft flying between Newcastle and Sydney than there are buses in some of the suburbs of Newcastle. These things should be looked at. When the Government of Queensland says that we have to retain F27 aircraft it is doing the people of western Queensland a disservice. I honestly believe that with the appropriate selective type of light aircraft they will get a much better service than they have presently.

The legislation we are dealing with is the Airlines Equipment (Loan Guarantee) Bill, which deals with a guarantee by this Parliament of loans totalling some $490m for Ansett Transport Industries Ltd to enable it to buy 21 Boeing aircraft. I join the honourable member for Bowman on the score that this is another step into the field of genuine competition between the two main trunk route operators. Trans-Australia Airlines opted for the A300 aircraft, which I believe is a very good aircraft. It is highly suited for the work that it will be required to do in Australia, as are the aircraft that Ansett is proposing to buy. The Boeing Corporation is one of the best aircraft manufacturers in the world today. That has been proven by the performance of the aircraft that that company has manufactured. So for the first time we will have a degree of competition.

Years ago when Trans-Australia Airlines wanted to buy Caravelle aircraft, which likewise have proven themselves, it was refused permission to do so by the Menzies Government. We were stuck then with the aircraft that Ansett wanted. The same thing happened with the purchase of the DC6B aircraft for Ansett. Trans-Australia Airlines bought Viscounts. The Viscounts proved to be a better aircraft and a better proposition all told. They were more popular with the people and more economical. The result was that the Menzies Government forced Trans-Australia Airlines to exchange aircraft. Honourable members opposite talk about the policies of socialist parties. That was a case of socialising the losses and capitalising the gains to the advantage of Ansett. When Ansett makes a mistake the Liberal Government rectifies it. We are now at the stage where we will at least have a choice of aircraft. We may not have a choice as to departure and arrival times, but at least we will have a choice of aircraft on which to travel. The decision to purchase the five A300 aircraft and the 21 aircraft that Ansett is buying-a number of which are wide-bodied aircraft-should have been taken six years ago when the Labor Government was in office.

In 1974-75 the opinion of the airlines was sought as to the earliest date they could introduce wide-bodied aircraft. Ansett opposed the introduction of wide-bodied aircraft. The man was opposed to every damn thing that was a change. He was frightened of a real change. So he opposed it. By the time we reached some point with it we were unfortunately disposed of by a representative of the Central Intelligence Agency in Australia, the then Governor-General. This Government has done nothing about that in the intervening period. These aircraft would have provided more economic operations within Australia. They are quieter aircraft. Everything to do with these wide-bodied aircraft was preferable to the aircraft then in use in Australia. This Government has plenty to answer for. If the Labor Government had remained in office the result would have been much different. Wide-bodied aircraft would have been operating in Australia at least five years ago.

It is interesting to see this matter being brought forward at this stage. It is pretty obvious that the back bench members who thought that they had the Prime Minister (Mr Malcolm Fraser) by the scruff of the neck have been outsmarted. He has outsmarted them again, just as he has outsmarted the rest of the electorate over the years by making all sorts of promises and breaking them. A promise does not mean a thing to him. He breaks them as quick as lightning. This is another one that he will break. The back bench members will be double-crossed because once this Bill goes through the Parliament there will be nothing they can do about all the other pressures they have been talking about applying to the Prime Minister; the opportunity will be gone. Having in mind that these aircraft will be delivered in 1985, 1986, 1987 and 1988, this legislation should be brought in to cover the aircraft as they are being delivered to Ansett or Trans-Australia Airlines as the case may be.

One other matter I want to refer to is the question of interest. When we were in government we told the public what interest rates had to be paid on Eximbank loans. A few years ago-I think it was on 14 November 1978-when we last dealt with an airlines equipment Bill, I endeavoured to squeeze out of the then Minister for Transport-the present Minister for Primary Industry (Mr Nixon)-details of the interest rates. He could not give them to us. The information was commercial. The airlines were the only ones entitled to know. The interest rates that Ansett were paying were not something to be spread all over the world.

I have looked very closely on this occasion to ascertain the interest rates that Ansett is to pay. I read every word in the Minister's second reading speech. I assumed that this information was top secret and confidential and that it could not be released. The only way that I could find out what the interest rates were was to read the American Press. Cuttings from the American Press indicate that the interest rates are 8 per cent and 8.4 per cent. Why does not the Minister come into this place and tell the Parliament all the facts? Why does he not give us the details of what the interest rates are? This should not be a private matter. It involves this Parliament and it involves the people of Australia. The people of Australia are entitled to know. I hope that the Minister will learn a lesson. In fact this will be the last occasion on which he will be in charge of an airlines equipment Bill because aircraft will not be purchased for another three years. The honourable member for Shortland (Mr Morris) will be the next Minister to introduce an airlines equipment Bill.

One of the things that concerns me is the fact that we have no real control over the operations of Ansett. Sure, Ansett can come along each year and give us a piece of paper which purports to be a correct report of its operations. That is all we can get. It took me a long time as the shadow Minister for Transport in this place to force the government of the day into the position of requiring Ansett at least to give us that piece of paper. It was not so many years ago that the only information one could get on Ansett was the total financial report which it circulated publicly every 12 months. But at least we have that. As the Leader of the Opposition (Mr Hayden) said tonight, we do not know the internal workings of Ansett. We do not know what capital is invested in the airline. We do not know on what basis profit is calculated. One of the conditions of the guaranteed equipment loans that are of great financial advantage to Ansett should be that Ansett set up a separate airline, one that has nothing whatever to do with Ansett's road operations, nothing to do with Ansett's television interests and nothing to do with Murdoch's other investments. It should be a straight out airline operation whose activities are wholly and solely associated with aviation.

The same thing should apply as far as TAA is concerned. If TAA wants to go into the hire car business, into tourism or into engineering, that is okay. If it wants to do that it should set up a subsidiary company that will conduct those affairs. But because of the extent of the preferential treatment that the main trunkline operators are getting from this Government the people who are using those airlines are entitled to know that they are not paying 1c per kilometre more than they should be paying. I say to the Minister for Transport who is sitting at the table that the Government should give serious consideration to setting up an airline company that will do the things that I have just outlined. That company should operate only as an airline so that we know what the profits or losses are and what costs are incurred. We should be told about the whole operation of the airlines. We should say: 'To hell with the rest of the things they are doing'. The airline operations of these companies should be separate from other operations. Do not let us get the facts confused. We should require the airlines to declare their company investment, their share- holding and all the rest of it so that at least we can work out the true position.

On 14 September 1978 I made a speech on the last airlines equipment Bill which was Airline Equipment Bill (No. 2). In that speech I drew attention to what was happening at that time. I pointed out that TAA had purchased a number of 727 200 series Boeing aircraft and that it had financed this purchase out of its own money without borrowing from overseas. I further pointed out that Ansett had financed its aircraft purchase out of money that it had got from the Eximbank in the United States. I drew attention then to the fact that Associated Securities Ltd, the finance company, was in a perilous state, and that the money that was being borrowed by Ansett, allegedly for aircraft, was to finish up in ASL. About that time I think $10m was transferred by Ansett to ASL. Aviation money should not be used to bolster up a finance company or a television station as happened in the early days of a Melbourne television station that was owned and is still owned by Ansett. Ansett used money from its airline operations to keep that television station going. We are not interested in that. The two-airline agreement, airfares and all the rest of it involves aviation and not television. That is why I say to the Minister that the Government should require this airline to be a separate private company doing nothing else but aviation.

The debate which is being carried on at present is concerned with the comparative operations of TAA and Ansett. Let us have a look at the reports of these two organisations. For 1979-80 Ansett showed a net operating profit after income tax of $8,008,000. For the same period TAA's profit was $8,702,000. The 1979-80 report of TAA contains a table which covers the company's profits for the last five years. In fact one can go back for at least the last 20 years and one will find that TAA made a profit on every occasion. Why do honourable members opposite want to get rid of an organisation that makes millions of dollars profit year after year? They want to hand it over to their own supporters, the people who finance their election campaigns. That is the real import of the Government's intentions. If TAA were a losing proposition honourable members opposite would not want to touch it and they would not want to take it over at any price.

I would now like to discuss the amendment moved by the honourable member for Shortland and what is behind it. This whole deal involving this loan stinks like hell-like everything that Murdoch touches. This is the man who supported us in the 1972 election. When we would not deliver his crooked goods for him he then turned on us and in 1975 and ever since he has been instrumental in the defeat of the Labor Party and the return of the Liberal-National Country Party coalition. This man is a crook and anything that he is associated with is rotten and stinking. One only has to read the Australian papers to see what happened. A report from America in one paper was headed: 'Anger over Loan to Murdoch'. The article stated:

America's Export-Import Bank should be put out of business because of deals like its controversial loan to Ansett Airlines, an influential financial magazine claims.

This magazine was Barron's the weekly publication of Dow Jones and Co. This is typical of what is happening in America. That report was published on 3 June 1980. I do not have time to go through all the reports in the Australian Press of what is happening in America today. But another article states:

Senator William Proxmire, a Democratic member of the Senate Banking committee, has referred to the General Accounting Office-the investigative arm of Congress-allegations that more than 17 per cent of the loan is for publicity, advertising and other 'extras'.

One can go on. Three of the major organisations of the American Congress are investigating Ansett Transport Industries of Australia. Yet this Government is prepared to guarantee the loan of $490m. Although this company is under close investigation by the Congress of the United States the Government is still prepared to guarantee its loan. This matter should be deferred until this total inquiry has been completed and the people of Australia know whether the loan is fair dinkum or whether it is politically inspired. The history of the loan in the initial stages is that Mr Murdoch had lunch with the then President of the United States of America and three days later the bank came out and gave a most favourable loan-one of the most favourable loans that has been granted by Eximbank over recent years.