E&OE TRANSCRIPT

RADIO INTERVIEW

ABC RADIO AM WITH SABRA LANE

TUESDAY, 21 APRIL 2020
 
SUBJECTS: Coronavirus; Virgin Australia; support for Australian aviation industry during COVID-19.
 

SABRA LANE, HOST: The Federal Opposition Leader is Anthony Albanese. He joins us now. Good morning and welcome back to the program.
 

ANTHONY ALBANESE, LEADER OF THE AUSTRALIAN LABOR PARTY: Good morning, Sabra.
 

LANE: Is there any chance that the Government will tip in more money even if new owners are found?
 

ALBANESE: Well, we've got to remember this is about people. This is about the 9,000 workers directly employed by Virgin. The 6,000 indirectly employed as a result of Virgin. The hundreds of thousands employed in the tourism sector who depend upon a viable two-airline industry as an essential component of an effective tourism industry in Australia. And the millions of Australians who want an aviation sector that operates properly, that enables them to get to and from work or to tourist destinations, and particularly in regional Australia will suffer if Virgin just disappears. So, I believe that this is a critical juncture and it's a big test for the Government. This isn't a market failure. This is as a result of a Government decision, the right decision, to shut down sections of the economy to deal with the health crisis.
 

LANE: Alright. Let's go into some of this. You say it's also about workers. But it also is the fact that this company is 90 per cent foreign owned, Etihad and Singapore Airlines. So far, they're not prepared to put up this money. Richard Branson, he seems to be focused on putting people into space. And it sounds like he's prepared to mortgage his private island to help his global interests. But if none of these parties are serious about saving this Australian airline, why should taxpayers be on the hook for that?
 

ALBANESE: Look, there is a taxpayer interest in this. Putting people on the unemployment queues will cost taxpayers and it will cost the national economy if we don't have a viable two-airline system. It's one that didn't just appear overnight. It's one that's developed over a period of time. Virgin Blue was in existence when Ansett collapsed.
 

LANE: This company has only turned a profit twice in the past decade.
 

ALBANESE: That's right. Because it's been investing largely in capital as it's grown, as it's grown to provide full service competition between Virgin Australia and Qantas and then budget airline competition between Tiger and Jetstar. That has been a good thing. It has invested in Australian jobs, particularly in Queensland, and it's an important component of our national economy. And the idea that another airline will just appear overnight is a fantasy. And we know the Government has already raised the issue of cabotage that is removing restrictions on domestic airline activity and opening it up to foreign airlines.
 

LANE: Isn't administration the best place for this company to be right now that gives them the time to reorganise the business and carry on? Given too that we know that there are two private equity firms, one of them Australian-based, that could be interested in taking up the company?
 

ALBANESE: Well, let's be very clear about what the history of private equity firms is. Quite often, it's about coming in, stripping assets and turning a profit for the private equity firm. It's not about the national interest.
 

LANE: And you don't think the Government's mindful of that? Given you heard Mathias Cormann earlier say that the Government is determined to have two airlines operating in this country?
 

ALBANESE: With no plan whatsoever to get there except the fantasy that another one will appear overnight. And Scott Morrison, a Prime Minister who has a history of arguing to open up the airline sector, which would damage of course, obviously up to the disappearance of Virgin Australia but would also damage Qantas' capacity to operate as an effective domestic airline.
 

LANE: Does the Qantas CEO, Alan Joyce, shoulder any responsibility for this?
 

ALBANESE: Look, this is the responsibility of the COVID-19 disease. Without that we wouldn't be in this circumstance today. And that's why talk about market responses is quite contrary. Reminds me of the Government's rhetoric prior to intervening to have wage subsidies saying, 'Oh, no, we just will not intervene in that way'. They eventually woke up that they had to. That ideology and market-based ideology was not effective at a time where the Government has shut down sections of the economy. Now they need to apply the same flexibility here, give consideration to the long-term national economic interest as well as the specific interests of these workers who have families, who are part of local communities, not just those directly employed, but those who will be impacted over the long-term if we don't have a two-airline system in Australia.
 

LANE: Giving Virgin Airlines $1.4 billion sets a precedent for bailing out other companies, doesn't it?
 

ALBANESE: They weren't asking for a gift, Sabra. What they were asking for is support either in the form of a line of credit or what I have been arguing for which is an equity injection. And what we have around the world even including Virgin Australia, shareholders, Etihad, Singapore, HNA, all have direct government interests. And around the world, if you look at the aviation sector, particularly at this time, just about every airline in the Middle East, in Europe, in the US, they're propped up by government support as well. The government is directly involved because governments recognise that it's in the interest of nation states to have effective aviation sectors.
 

LANE: Okay. Federal Opposition Leader, Anthony Albanese. Thanks for joining the program this morning.
 

ALBANESE: Thanks very much, Sabra.
 
ENDS