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Wednesday, 3 October 1984
Page: 1552


Mr SPENDER(12.05 a.m.) —It is always a delight to speak in this House at this hour of the night.


Mr West —You like it?


Mr SPENDER —Oh, I like it greatly. This is the second night that it has happened . It is a living example of this Government's dedication to serious debate. While in opposition the Australian Labor Party was constantly and vociferously critical, and rightly so, of late night sittings. But now that it is in government, and now that it is rushing to judgment by the electorate, it is willing to turn its principles on their head for the purpose of forcing legislation through. We have before us tonight three Bills, the Air Navigation ( Charges) Amendment Bill, the Air Navigation Amendment Bill (No. 2) and the Qantas Airways Limited (Loan Guarantee) Bill. I will deal briefly with each of those Bills at this stage. Certain amendments will be moved in the Committee stage, some of which will be agreed to by the Government and some of which have not been agreed to by the Government.

The Qantas Airways Limited (Loan Guarantee) Bill 1984 is brought before this House for the purposes of guaranteeing borrowings to finance two B767-200 extended range aircraft. The limit of the guarantee is $200m. This is part of Qantas's major fleet modernisation program. Certainly, it is the largest fleet modernisation program engaged in by any Australian company and I think it is the largest single overseas purchase of aircraft by any Australian company. The whole question of Qantas's capacity to meet the guarantees, to meet the interest which will be due by it and to meet the principal amount it borrows, will depend very greatly on its profitability. Back in December 1983 I asked the Minister for Aviation (Mr Beazley) a question about the proposal by Qantas to borrow a great deal of money. I said:

Will the Minister give an undertaking to this House that the proposed purchase by Qantas of new planes for the sum of $860m will be made without recourse to the Australian Government for taxpayers' funds?

The Minister, after somewhat insincere protestations about his nervousness or about his having waited for some considerable time for a question from me, said:

The request by Qantas Airways Ltd for approval for its purchase of additional aircraft was presented to the Government on the basis that the purchase could be effected within the framework of Qantas's anticipated earnings over, I think, the next 10 years and also within the framework of funds that would be available to the airline and which would come from sources other than an additional capital injection.

He went on to say:

I do not want to give quite the unqualified statement that the honourable member's question seemed to require of me in relation to a future capital injection into Qantas. But the figures on which the assessments were made were, if you like, not over optimistic. If anything, they were on the pessimistic side when looking at Qantas's trading possibilities.

He also said:

I do not anticipate that a capital injection will be required in relation to Qantas's purchases. The Government decision was taken on the assumption that that would not be necessary.

The view that I put to the House is, bluntly-I accept that the Minister has been given certain projections and I accept that they have been made in good faith by Qantas; indeed, I have seen the same projections myself-that it is quite impossible to say what will happen in 10 years, five years, three years or two years time in a market such as the international aviation market. One need only go back and look at the history of that market over the last four or five years. Therefore, to base the guarantee and the support for Qantas's purchase on forward projections of that kind is a very speculative exercise indeed. However, I wish Qantas well, as I am sure every member of the Opposition does.

We support the proposal for the guarantee, stating as we do the qualification that it is for the Government and Qantas to justify in the future the accuracy of the projections on which the guarantee effectively is founded. Whilst we support Qantas as Australia's overseas flag carrier, we must not be taken to be giving in advance any kind of encouragement to the proposition that further capital should be coming from the Australian people should Qantas find that its forward projections are not in fact as accurate as it hoped or should unforeseen circumstances arise which make the international market a very much tougher proposition than Qantas expected.

The next Bill I wish to refer to is the Bill to amend the Air Navigation Act of 1920. The purposes of this Bill, the Air Navigation Amendment Bill (No. 2), as stated in the explanatory memorandum are twofold. The Bill proposes:

. . . to give the Commonwealth power to suspend or cancel international airline licences issued to foreign carriers where:

(1) The safety of air navigation in relation to Australia is likely to be affected by the likely failure of a foreign airline or an aircraft operated by that airline to comply with the Air Navigation Act, Regulations or the terms of its licence or where the relevant overseas aeronautical authority has not made adequate provision to ensure compliance by that airline and its aircraft with international standards, practices and procedures.

(2) It is considered necessary or desirable to do so-

that is, to suspend or cancel an international airline licence issued to a foreign carrier-

to preserve or promote fair competition in international air transport services.

The first of the two purposes of the Bill is sensible. The airline industry is constantly expanding, developing and changing, and we think it is a useful and sensible provision to be available to a government when it sees or judges that a safety problem will arise so that it can act in anticipation of that problem. The second of the purposes-that is, 'to preserve or promote fair competition in international air transport services'-is expressed in very general terms. The Bill itself simply says this:

(d) in the opinion of the Minister it is necessary or desirable to do so-

that is, to suspend or cancel a licence-

for the purpose of preserving or promoting fair competition in international air transport services.

That does not tell one very much about what the Government has in mind. If one looks at the second reading speech one sees that the Minister for Aviation, after referring to the provision for cancellation and suspension of a licence in the interests of fair competition, says:

At the moment the Government does not have the capability to cancel or suspend a licence where an overseas government decides to withdraw the licence of or reduce the activity of an Australian carrier. If these circumstances eventuated it would be important to be able to respond to the situation.

In looking to the explanatory memorandum, the same concept is repeated. In relation to the power which is envisaged, the memorandum states:

Such action would be taken in the context where adverse actions are taken by overseas Governments and Authorities which impair the ability of Australian carriers to provide international air services on a fair and competitive basis.

There are, I believe, in other countries and in the United States -I instance the United States-wider provisions which enable the Government to take action against a foreign airline of a kind which is not open to the Australian Government. On the basis that the purpose of the provision is that which has been outlined very briefly in the second reading speech and very briefly in the explanatory memorandum, we support the proposal. I point out that it is not in terms directed towards actions of foreign governments or foreign authorities; it is expressed in very wide terms and a widely expressed discretion can be misused . However, the Minister has said effectively in his second reading speech and by the explanatory memorandum that the real purpose of the provision is to protect Australia's interests against decisions by foreign governments or authorities. We want to protect Australia's interests in those circumstances although I would have thought that the provision could have been much more tightly expressed. In particular I point out that we understand that it is not directed to, or to be used for, the imposing of the Government's views on what is fair in terms of market competition, for example, price competition on the Pacific routes, nor is it to be used to deal with such cases as the capability of Air India to carry international passengers within Australia. It is proposed before the Parliament to meet a particular identifiable problem. The provision should have been expressed in more precise terms. However, I accept what the Minister has said in the explanatory memorandum and the second reading speech. The measure is directed to a particular kind of problem and is to be used only for the purposes of dealing with that problem. On that basis and on that basis alone we support the proposal in the Bill to amend the Air Navigation Act.

I come to the Air Navigation (Charges) Amendment Bill the purpose of which is threefold. Firstly, it enhances the Government's ability to collect air navigation charges by putting in place a debt recovery process based on the creation of a statutory lien over aircraft on which air navigation charges remain outstanding. Secondly, it provides for the introduction of separate airport and airway charges and, thirdly, it brings the Act's payment and penalty provisions more into line with commercially accepted practices and implements new measures of a machinery nature.

In general terms the Opposition supports the Bill and the concepts behind it but has certain specific amendments to move. They have been discussed with the Minister. Some of them will be accepted by the Government and some will not. Very briefly, the amendments deal firstly with the increase in the interest charges and the compounding of interest charges. We think that what is proposed is too high. It is one thing to be zealous about the revenue but I think one has to deal fairly with carriers and with those who are in the industry. Secondly, the statutory lien which is proposed under this Bill would operate to defeat existing creditors. For example, where a company has a plane as its sole asset, where that plane has been repaired and a large bill is owing to a fairly modest organisation, before that bill is paid the statutory lien comes into effect. As the Bill is now expressed, that statutory lien would have priority over any money which was due to the repairer. That does not seem to us to be fair. We believe that the Commonwealth should not be overzealous about exercising its legislative powers so as to get priorities in circumstances where others who have dealt bona fide and who are owed money are displaced so that the revenue can benefit.

Thirdly, we propose certain amendments to the provision which deals with seizing an aircraft which is the subject of a statutory lien after a certain period has expired. When a seizure process is taken, we propose that there should be more specific provisions in the Bill to deal with the question of notification. Fourthly, we propose a specific measure relating to the issuing of certificates by the Department of Aviation so that persons who deal in good faith with an aircraft, such as owners and who get a certificate from the Department to the effect that there are no outstanding moneys due for air navigation charges and penalties, cannot then be faced with a statutory lien; that is, the Department cannot turn around and say: 'Look, we are very sorry. We made an error.' It is rather akin to the provisions which exist in relation to the sale of registered land. That amendment is proposed by the Opposition in the interests of clarity and fairness to those who deal with aircraft.

Lastly, there is a rather delightful provision which somehow crept in. It reads :

A person who, while a statutory lien is in effect in respect of an aircraft, detaches any part or equipment from the aircraft without the prior approval of an authorised officer is guilty of an indictable offence punishable by a fine not exceeding $5,000 or imprisonment for a period not exceeding 2 years, or both .

That would mean in the terms in which it is expressed that a person without notice of a lien, without knowing of its existence and who for the purposes of repairing and aircraft engine took it away to his workshop, would on the face of things be guilty of an offence. It is true, I suppose, that the Department would say he would not be prosecuted in those circumstances, but one cannot depend on departmental guidelines for the purposes of overcoming obvious deficiencies in a Bill. That kind of measure should not have been proposed to this House in the first place. It also has a somewhat ironic consequence in that for the purposes of meeting obligations under the air navigation regulations, that is acts done under those regulations, one might find oneself in precisely the same position because one might have moved part of the aircraft for the sake of repairing it. You would be damned if you did and damned if you did not. Anyone who did not comply with the air navigation regulations might render himself liable to a penalty. If he did he might render himself liable to two years imprisonment and a fine of $5,000. Obviously, that is not intended and the provision should not be in the Bill.

The House will be going into Committee to consider those amendments. I do not wish to say anything further about them now. The Government's acceptance of certain of them is sensible. The Minister, as always, has been very frank and open in his dealings with me, as has his Department. However, what we have tonight are the hallmarks of rushed legislation, which has been introduced without sufficient thought being given to it. If sufficient thought had been given to it my proposed amendments, which the Government accepts, would never have been necessary.