By Andrew Brown
Treasurer Jim Chalmers says Qantas was under no obligation to pay back the $2.7 billion in taxpayer subsidies it received during Australia’s pandemic lockdown once the borders reopened, after the airline posted a record profit for the past financial year.
“When those funds were provided by the previous government, there wasn’t an understanding or an agreement that they would be repaid in some form,” Chalmers told ABC’s Radio National on Friday.
Treasurer Jim Chalmers said there had been no agreement to claw back pandemic subsidies from Qantas once Australia’s borders reopened. Credit: Alex Ellinghausen
“What (the profits) reflect is the fact the Australian tourism industry is making a big contribution to our economy, and that’s a good thing. It’s a big employer in our economy.”
Outgoing Qantas chief executive Alan Joyce rejected calls for repayments on Thursday night, telling the ABC’s 7.30 that money would ultimately be recouped through taxes the company was paying now.
“As we’re making money, we’ll pay corporation tax and get there faster,” he said.
“Should our people who got the money for JobKeeper pay that back? I’d say no, because that’s asking them to pay it back in a difficult period of time, so what money do we pay back exactly?”
Announcing the company’s record $2.47 billion profit on Thursday, Joyce said the underlying profit marked the end of a torrid period for the $10.7 billion company – which holds more than 60 per cent of the domestic market– during which it accrued more than $7 billion in statutory debt.
The company received $900 million in JobKeeper subsidies alone after the Morrison government banned international travel to lock out COVID. Joyce said the company was just 11 weeks away from bankruptcy at the time.
The Australian Chamber of Commerce and Industry’s executive chairman John Hart and Virgin Australia boss Jayne Hrdlicka are mong those in the tourism and aviation industry who have urged the government to allow Qatar Airways more flights into Australia, a proposition opposed by Qantas.
Qantas boss Alan Joyce.Credit: Dion Georgopoulos
Joyce, who will front the Senate’s cost-of-living inquiry next week, argues that allowing more flights to Australia could distort the international travel market in the country, even though fares remain up to 50 per cent higher than they were before the pandemic.
Opposition Leader Peter Dutton said he “had real questions” over the government’s decision to block Qatar’s application.
“Anyone flying to Europe or Asia or the Americas at the moment realises that the prices are astronomical, so more competition and more flights on those routes will help.
“It’s also a huge benefit for inbound tourism where those additional people coming in on those flights are spending money in cafes, and in restaurants, at tourist destinations, at a time when we need it, when the economy is starting to slow under this government. So, there are many reasons why the government should properly explain their decision, but, at the moment, it’s all over the place.”
Dutton did not call for Qantas to pay back pandemic subsidies, instead paying tribute to Joyce for keeping the company going while Australia’s borders were closed.
“It was a tough period for those airlines, to be able to keep the company afloat during that period with the support of a lot of taxpayers’ money, I think that will be one thing that he chalks up,” Dutton told Nine’s Today program.
Asked if Joyce should return money to the taxpayers, former Treasury secretary Ken Henry said it would be “a question for him and his conscience”.
Joyce steps down as chief executive officer in November, after 14 years in the role, and will be replaced by the current chief financial officer, Vanessa Hudson.
Cut through the noise of federal politics with news, views and expert analysis from Jacqueline Maley. Subscribers can sign up to our weekly Inside Politics newsletter here.
AAP, with Amelia McGuire