The mask, slipping for years, is now fully off: Qantas under Alan Joyce despises its own customers as much as it despises its workers.
It illegally sacked workers during the pandemic. Now we learn it illegally sold tickets for flights it knew would never happen.
The Australian Competition and Consumer Commission (ACCC)’s case against Qantas is forensic. It lists the flights cancelled days, weeks, and sometimes months in advance, the ticket sales that continued weeks, sometimes months, after the cancellation, and the refusal to tell people unlucky enough to have trusted the airline. All clear breaches of Australian Consumer Law.
As a number of observers have pointed out, it’s very similar to the big banks’ fee-for-no-service scam (cost: $4.7 billion and counting) — except there’s a clear element of deliberation in Qantas’ behaviour. It knew the services would never be provided but kept offering tickets.
And as the ACCC notes, these weren’t flights cancelled because of storms, or accidents, or normal aviation delays of the kind that frustrate all of us, but for “reasons that were within its control, such as network optimisation including in response to shifts in consumer demand, route withdrawals or retention of take-off and landing slots at certain airports,” according to ACCC Chair Gina Cass-Gottlieb.
That is, Qantas committed this crime in pursuit of another crime — anti-competitive hoarding of airport slots, of which both Qantas and Virgin are guilty, according to Sydney Airport. But according to the ACCC, Virgin never sold tickets for already-cancelled flights.
And while customers didn’t know their flight was never going to happen, and then had to wait for their refund after they found out, Qantas was able to leave their money in the bank, earning interest. Think of the numbers: it scammed customers on over 8000 flights. Even on conservative estimates, the money involved is over $100 million taken under false pretences. A nice little earner on interest alone.
This scam was approved within Qantas, possibly at the very highest levels. The executives involved need to be identified. Prosecution under section 158 of the Consumer Law should be considered — accepting payment or other consideration for goods or services when the vendor intends not to supply the goods or services, which can lead to a fine of up to $2.5 million.
But under even the lax standards of corporate behaviour in Australia, the accountability needs to go much wider. When the banks and AMP were exposed for fees for no service, CEO and chair heads rolled. When PwC’s leaking of confidential tax information and subsequent cover-up were exposed, not only was management purged — everyone who knew about the leak was (eventually) sent packing.
That’s what Qantas needs to do immediately. With Joyce already going, chair Richard Goyder must go too — now. So too senior Qantas management in customer-related roles. What did incoming CEO Vanessa Hudson know as CFO, and when did she know it? Her position is untenable if she had the slightest inkling of what the airline was doing. All of those within Qantas who knew of the scam must go, PwC-style.
And the rest of the Qantas board have serious questions to answer. Did they know this was going on? Were they also aware of the way the airline was resisting refunding COVID flight credits, and the numbers involved? Are they aware of Qantas’ anti-competitive behaviour in relation to airport slots? Howard-era Liberal apparatchik Michael L’Estrange is leaving in November; former American Airlines CEO Doug Parker has only just joined. That leaves Maxine Brenner and Jacqueline Hey — both of whom are long-term directors at the company — Belinda Hutchinson, Antony Tyler and the egregious Todd Sampson with plenty of explaining to do.
What did they know, and when did they know it? Why aren’t they considering their positions as well?
The revelations couldn’t have come at a worse time for the Albanese government, now mired in a scandal of its own making over its cosy relationship with Qantas and its readiness to bend over backwards to maintain its profits at the expense of Australians. Now we know exactly what kind of outfit Labor is protecting. It’s every bit as bad as the protection racket the Coalition ran for the big banks.
At least the ACCC is committed to doing its job, even if Labor isn’t. When former Murdoch consigliere Cass-Gottlieb was appointed as ACCC chair, Crikey questioned her suitability. She’s proven us wrong in the best way. Just ask Joyce and Goyder.
Is it time for an overhaul of Qantas’ top management? Let us know by writing to letters@crikey.com.au. Please include your full name to be considered for publication. We reserve the right to edit for length and clarity.
Yes, fair enough. But let’s be clear: often nothing much happens when companies behave badly, and when serious enforcement is taken it almost always falls on the body corporate — the company — and not on senior executives or directors. The ACCC is calling for very big fines, but only on the company. Fining the company can be too much like collective punishment. Maybe it does hurt the guilty, but it only slightly affects their personal wealth, while by damaging the company it also hits a great many others — ordinary employees, customers, sub-contractors, small shareholders — who have little or nothing to do with the actual guilty conduct. There needs to be huge shift in regulatory enforcement generally to put the individuals who devise, direct and order these illegal schemes in the dock, so they can be held personally responsible and on conviction can each be heavily fined and/or gaoled. That’s the only way to make corporate crooks think twice before behaving like this.
Spot on.
Rob a bank and go to gaol, rob a country and there’s no such deterrent, in fact there’s only encouragement/facilitation/lax or even helpful legislation. What. A. Joke.
Steal a loaf of bread, get sent to NSW; steal Bengal, become governor of NSW.
The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread.
— Anatole France
clarification: the above comment is a quotation, but I unfortunately omitted the customary punctuation.
And an excellent quotation it is. Thanks for sharing.
We are mere corruption amateurs. In Britain it’s the Tory path to a seat in the House of Lords – a peerage no less.
PPE = personal private enterprise……just ask Boris.
PPE (public private enterprise) is one of the great cons and it seems no-one has woken up.
Private Eye magazine in the UK woke up long ago. It has since the 1990s at least been reporting the various horrors, rorts and scandals associated with PFI (private finance initiative) or public-private partnership (PPP). This has included full detailed descriptions of how the scam is done and how badly the public has been ripped off. Nothing changes, nobody cares. There is a free Private Eye special report you can download from the magazine’s website, ‘P.F. Eye, An Idiot’s Guide to the PFI’ by their great investigative journalist, the late Paul Foot, so it was probably written about 15 years ago.
Fun fact: The first known examples of PFI/PPP were devised by Il Duce, Mussolini, in the late 1920s.
PPE, however, is usually Personal Protective Equipment, such as hard hats, safety glasses and steel-toe boots.
Like the bit about Il Duce, suggests oligarchy and no surprise; the fossil fueled Club of Rome on Rockefeller Estate (then Exxon) inc. junk science of ‘limits to growth’ etc. was a far right astroturf and sponsored by VW (AH’s mate Porsche) and Fiat of Agnelli Snr was allegedly Mussolini’s mate; promoting interests of <1%, junk vs. climate science and autarky like the 1930s.
totally concur – hit the individuals with the real power to ruin democracy – not lowly ones used as scapegoats mind – but the big players beyond the rabble ; those who enact on high ie robodebt – hit the evil hiding behind workers and applications a
Although many Australians have antipathy, predicated on ignorance, towards the EU, the EC has robust regulations and compensation requirements for airlines; while UK and Oz view this as ‘red tape’.
Reminiscent of a UK Retailer when their HR Director was asked on their policy towards their own personnel, response was ‘we don’t have one, we simply treat them like sh*t’, also seems to be similar in the ‘free market’ wonderlands of US, UK & Oz when it comes to customer services, with a whiff of authoritarianism to maintain profit margins?
How funny ; in Vic now taxi drivers have been called out for price gouging ; The govt has implemented huge fines to outlaw any impacts on the base fare standards ! Where is the difference -the corporatized mobster model does a contra deal? Its insanity
So we have non existent flights sold and the revenue booked, 8,000 or so times, with no intention of refunding in any timely way. That is taking money with no service, and should be treated as corporate theft. Joyce walks away with a truckload of money on the basis of hundreds of millions of revenue that should never have entered Qantas’ profit and loss statement. And, don’t forget, reward for breaking the unions involved and trashing the brand and staff morale. What a business plan. I agree that the whole board should go and the senior execs who received bonuses should have to give them back. Joyce should have to relinquish his multi million ill deserved payout as well, and then leave the country. Once a great airline now a brand treated with derision..
It was never a business plan it was an Alan Joyce plan. Selling $17 million in Qantas shares in June by Joyce was very fortuitous was it not. As you say all those ghost flight bookings money ended up on a bottom line somewhere with a credit debt somewhere else, credit vouchers which are devaluing as we speak because of inflation and hyper inflation of Qantas airfares. Time to go Alan and friends.
Australia Post protect from the scammer pirates and neo cons perverting labor and liberal ( freedom liberty )
As I understand the sequence, Joyce was engaged by the QA Board specifically to do a job of union busting. They got what they’ve paid for, but the price is loss of respect. It may be shielded by scarcity and excellent marketing (the choirs warbling patriotism based on what QA used to be), but the price for long term brand damage will be paid down the track (when old-mate Allan is living in some tax haven). Meanwhile the basic function of having an air transport system that works for the benefit of the nation is consigned to history. What a legacy.
Even a supposedly right wing business type must see- let alone the anon shareholders that the brand has been trashed irreparably despite 2 nights ago another right wing talking head announcing his belief in the creeps
Looks like Joyce just marches off into the sunset with millions of dollars in severance. MAYBE that severance should be withheld so the exit is not a reward for duping the public. There seems to be no end to the lengths QANTAS has gone to rip it’s customers off, destroy its workforce, take taxpayer jobkeeper billions, collude to reduce competition from QATAR. Surely Joyce must be held accountable.
Since when have heads of corporations ever been held accountable and personally liable for their actions?
Personalise profits and distribute losses through the company ….
24 mill in one bonus this one year – parasitic
Joyce could join this gang – https://www.news.com.au/news/national/two-men-arrested-in-alleged-irish-roof-scam-after-conning-260k-from-a-single-victim/news-story/2cbf671c128eb9bc4eaeeac8c8778838
It’s a game to them. See who can come out on top of the pile of income, where that income is stratospheric in relation to what you or I earn. Money is a plaything, its only worth in indicating how high up the pecking order they are. All CEOs and executives play the game, and all are complicit.
And leigh clifford who was chairman I think when joyce was appointed, the creep who smashed the unions at robe river mines in W.A.
It is simple criminal fraud. Why treat them like the top end of town? They are simply criminals.
totally its a lie to stral peopkes money irresoective of the loss – and its bad for the economy
“There’s an Australian institution, lying, dying,
And it gets itself up one finger, and turns to the ACCC,
Who are gathering around, and says –
Put the share-holders first, Al,
Put the share-holders first,
Ya bonus is jacked up with them, Clem,
So put the share-holders first.
All together now …
Run me kangaroo down, c-l-o-w-n,
Run me kangaroo down,
Run me kangaroo down, c-l-o-w-n
Run it into the ground.
Clip the marks while you can, Alan,
Clip the marks while you can,
It’s not like you got any choice, Joyce
So rip ’em off while ya can,
All together now….
Run me kangaroo down c-l-o-w-n ….
Sell them phantom seats quick, D-i-c-k,
Sell them phantom seats quick.
It’s not like anyone checks, Slick,
So sell them phantom seats quick.
All together now ….
Run me kangaroo down c-l-o-w-n ……
Give the porters the sack, Jack
Give the porters the sack,
Contractors can fill up the crack Jack.
So give all the porters the sack.
All together now ….
.
Run me kangaroo down c-l-o-w-n ……
Jobkeeper put us in black Mac
Jobkeeper put us in black.
Thanks for all o’ that dosh, Josh,
Taxpayers paid for me craik….
Excellent. Inspired by a different sort of criminal – Ralf Horrid.
…. Troobl at millbot, too?
Aye, lad. Crook OK but Crimin@l not.
They “Awaiting (f)a”‘d me, then disappeared my first edition.
Excellent – inspired by a different sort of crook – Ralf Horrid.
“Six White Bloomers”?