If you’re labouring under any illusion that Qantas has changed from the abusive, gouging monopolist that holds its customers and workers in contempt, get a hold of its response to the government’s lame aviation green paper and behold the drivel it is peddling as a serious contribution to public policy.
The green paper broadly hews to Labor’s pro-Qantas line, but the state of competition in aviation in Australia is now so awful that even the paper acknowledged big problems. The “domestic aviation sector is highly concentrated, with few market participants”, it says, characterised by “airlines no longer competing ‘head to head’ and focussing on market niches”. This “could adversely impact consumers and businesses that rely on aviation”.
Not true, says Qantas in its response. In fact, aviation is highly competitive. “A concentrated market does not necessarily equate to a lack of competition,” Qantas insists. “There are now four large jet operators, with Regional Express expanding onto mainline routes and the entry of Bonza … Qantas and Jetstar continue to closely monitor changes to the Regional Express and Bonza operating models (along with Virgin Australia’s) and respond appropriately.”
Bonza has five planes and doesn’t fly to Sydney, because it can’t get slots. Qantas has 125 planes and hoards slots at Sydney Airport. Bonza just had to cancel flights because it couldn’t get approval to lease two more planes. But, yep, Bonza is exerting competitive pressure on Qantas. Sure thing.
Qantas continues to deny the reality of its slots-hoarding. It says if you want more slots at Sydney, get rid of the curfew. “The Qantas Group notes that the Harris review [a review of slots management by former Productivity Commission chair Peter Harris] had a limited scope and that the 80 movement cap, Sydney Airport curfew and broader Sydney basin were explicitly out of scope. This was a missed opportunity. A comprehensive review addressing known operational challenges and efficiency gains cannot be properly conducted without engaging with these issues.”
But it’s the green paper’s mild flirtation with greater consumer protections that has the airline exercised, reflecting its status as the most complained-about company in the country. As with competition, everything is just fine in consumer protection, Qantas says. It certainly doesn’t want any additional aviation-specific safeguards for consumers. “The whole-of-economy application of the Australian consumer law represents best practice and has been identified as one of its key strengths,” Qantas says. “Its simplicity ensures that no matter what the product or service, consumers are clear about their rights and recourse.”
Simplicity? Clarity? You can imagine how Qantas’ corporate relations scribes giggled as they wrote this. This is the airline that responded to the Australian Competition and Consumer Commission’s (ACCC) allegations that it sold tickets to huge numbers of flights it had no intention of ever flying by saying it didn’t sell tickets to flights, it sold “bundles of rights”. Qantas “does not guarantee particular flight times or its flight schedules,” it told the ACCC. It doesn’t even promise to make “reasonable endeavours to operate any particular flight”. But, sure, consumers are clear about their rights and recourse!
What really worries Qantas, though, is the prospect that the government might consider European Union-style compensation requirements for delayed or cancelled flights — for which Qantas has an abysmal record. The EU requirement is called EU261 and, according to Qantas, doesn’t work. “The scheme hasn’t led to a reduction in the amount of disruption. As [the International Air Transport Association] noted in June 2023, the commission’s own data shows that disruptions have increased since EU261 was introduced.”
Except that’s a bald lie from what is the international lobby group for airlines. According to a peer-reviewed paper by German and Polish economists published earlier this year, EU261 quantifiably does work: “Regulated flights are 5% more likely to arrive on time, and mean arrival delay is reduced by almost four minutes. The effect is strongest on routes with little competition, and for legacy carriers. Thus, consumer rights can improve quality when incentives from competition are weak.”
That’s a frightening conclusion for Qantas: given the lack of competition it faces, the evidence shows a compensation requirement would lead to a noticeable improvement in on-time performance.
As for the much-criticised airline-funded and controlled customer complaints scheme, the Airline Customer Advocate (ACA), which the green paper noted didn’t provide a “low-cost, accessible legal process which can ensure passengers can access fair treatment”, Qantas thinks that, too, is fine. Why? They are “refreshing the Airline Customer Advocate’s website to enhance its functionality and simplicity”. Also, they’re actually going to do a review of the ACA’s performance, and airlines have made “a renewed commitment to improving response timeframes” (note the “renewed” — they’ve committed to improve timeliness before, but failed).
Under no circumstances should the government consider an independent airline ombudsman, Qantas says. Too expensive. And notoriously slow. And probably wouldn’t have a “refreshed” website.
And what about access for the disabled? Does Qantas support any reforms that would see an end to Qantas wheelchair-using passengers being dropped from their wheelchairs and being forced to crawl to their seats, or forcing passengers to stay on a plane and go back to where they came from because Qantas refuses to disembark them at their destination, breaking customers’ wheelchairs, leaving passengers on planes because they can’t get their wheelchair, or threatening disabled customers with the AFP if they complain?
Again, nothing to see here. There’s no need for any reform, and existing exemptions for airlines need to stay in place. Any changes should recognise it’s all very expensive to transport people with special needs — “some customers require significant assistance to be able to travel which involves additional equipment, resourcing and operational/safety considerations”.
In fact, the only area in aviation that needs any substantial reform is the airport owners. “As effectively unregulated monopoly infrastructure, many Australian airports have a track record of using their market power, with the current regulatory regime providing no constraint on monopoly behaviour or providing any incentive to lower costs or improve quality.”
An unregulated monopoly using its market power without any incentive to lower costs or improve quality. Qantas certainly knows all about that.
Are you surprised by Qantas’ response to the government green paper? Do you plan to hop on board the flying Kangaroo any time soon? Let us know your thoughts 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.
It would be entirely appropriate for Qantas to change its logo from the outdated flying kangaroo to a flying (feral) pig, with its face wedged firmly in a trough.
Its explanation of why consumer protection for its passengers would only hurt the poor unfortunate passengers joins a long list of such special pleadings from various businesses going back to the dawn of any such proposed regulation in any sector. It’s always lies, smoke and mirrors in defence of unacceptable practices used for commercial advantage. If the government has any spine it will implement the suggested protections anyway; in the unlikely event Qantas is vindicated and the results are found to be counter to passenger interests, they can always be reversed later.
My God, this dodgy mob still don’t get it. In two weeks: 3 of my flights cancelled; tried to use a credit but was forced by the credit booking page into a higher category at $345 extra (even though returning to the main booking page the lower category/cheaper prices was still available); 5 hour delay for one flight; another flight circled for so long before that it was diverted to another airport to refuel; broken escalators x 2.
Still waiting for a refund 6 weeks later after a 2.5 hour wait for them to answer the phone.
Then they have the gall to announce that financial compensation penalties for delayed/cancelled flights would increase prices (not eliminate their scams and make them more efficient). This monopolistic business needs to be brought under control by federal legislation, but unfortunately the government is working against Australians’ interests by supporting this deceitful company.
The very first step is to disallow all federal parliamentarians (plus family members) admission to the Qantas Chairman’s Lounge.
Or abolish it.
I refer you to Robert Reynolds’ post circa 4 hours ago.
As with all the social goods pioneered, introduced and built by governments, once the greedy bastards and their dullard mates in power turn them into sinecures for the wealthy, all good is forfeit for the hoi polloi.
All you are doing Bernard is writing yet another (the umpteenth if my counting is correct) piece on free market capitalism in action; that is Bernard, the free market working in just the way it is meant to work – putting profits and ‘performance’ bonuses before people and the environment. I don’t recall Qantas having anything like these problems when it was publically owned. If you are really annoyed about the behavior of this company why don’t you recommend some meaningful action – like nationalizing it. Not only would that fix the problem in the airline industry but it would send a powerful message to other corporate robbers in say, the banking industry, construction industry, aged-care and disability sectors, and gambling industry (just to name a few), that they had better lift their game or face the same outcome.
Clearly, decades of hand-wringing, Royal Commissions, and critical media articles are, at ‘the end of the day’, completely ignored by the corporate self-serving, robber barons who run this country.
If you think Qantas is operating in a free market you have no idea what a free market is. Qantas can only act like this because it is not in a free market.
Christ help us if Qantus (along with the rest of the business sector) was operating in a ‘free market’ SSR. The economic environment here in Australia (and the West in general) is much closer to being a free market now than it was post-World War 2.
Swapping a nationalised monopoly for a privatised quasi-monopoly pampered and protected by the government has little to do with a free market. Anyway, your fear of a real free market (if such a thing is possible) is another indication you don’t know what it is.
Oh sorry Rat for my complete ignorance about a free market.
Perhaps someone who is as sagacious and omniscient as you so obviously are, could enlighten a poor ignorant soul like myself about the intricacies of this “real free market”.
You don’t need me to do your homework. The basics were set out over two hundred years ago by Adam Smith, and have been well known ever since. If you cannot be bothered to find out, don’t complain when your ignorance shows.
Ahh, the world according to Rat!
Just wondering rat, what is I choose to (re)read the basics of the free market written by Adam Smith and I come up with a different interpretation to yours? (How could I ever live with myself?)
Pardon me if I treat your response with the contempt that it deserves.
If only my ignorance matched the levels of your arrogance and impertinence!
Agree, and worse it seems to reflect a culture in Australia of preference for large monopolies and oligopolies masquerading as ‘national champions’ who can gain favour from and cater to governments and avoid real competition.
Solution to QANTAS is creating a more competitive environment with consumer protections upgraded fast & reliable rail, adopting EU standards (especially to wind up News & IPA), breaking QANTAS up i.e. at least international from domestic and government not blocking competition eg. Qatar Airways.
Sorry Drew but decades (no, make that centuries!) of experience shows that you have more chance of finding a pot of gold at the end of a rainbow than creating a fair and just capitalist system by “creating a more competitive environment”.
That “competitive environment” you fantasize about has really worked wonders in the, inter alia, banking industry, supermarket industry, accounting giants, and tendering for contracts in the disability sector, etc., hasn’t it?
It really does take a lot for some to wake up to what is nothing more than a gargantuan scam being perpetrated on the bulk of the population.
Really versus low or no competition?
Meanwhile, suggesting consumer protections are not needed locally, unlike e.g. the EU, because Australians prefer bad customer service and are treated like rubbish by a ‘national champion’ and others?
Symptom of authoritarianism accepting the suboptimal status quo?
I would like to write a considered reply to your post Drew, but unfortunately, I can’t understand what you are trying to say. Who is suggesting consumer protections are not needed locally (or internationally)? And who is suggesting that Australians prefer bad customer service?
(You weren’t enjoying a bit of “Christmas cheer” before you wrote this, were you Drew?)
Well, I suppose Drew, they don’t call this the “silly season” for nothing.
You use a lot of words to complain and say nothing of substance, let alone explain anything, but then shoot messengers…. why are Australians so thin skinned, nasty and paranoid; running protection for authority?
So are you really saying that there would be no point in increasing the competitive environment that Qantas faces, and improving regulation? In Europe, low cost airlines such as EasyJet and Ryanair have made air travel massively cheaper than it was, and with regulation there are consumer protections, compensation for late flights etc. Introducing consumer protection as per the EU, freeing up landing spots at Sydney airport etc and allowing more flights from overseas would all improve things massively. The limits to the benefits of competition you point to in areas such as banking and disability sector are very real, but often these are a failure of regulation, allowing monopolies to develop or pushing competition into non market sectors. This doesnt mean that Qantas could not face a lot more competition with benefits to consumers. In general, people’s lives in western countries are also massively better than either in previous times or in other countries.
Then how about you stop splitting hairs about nomenclature and admit that the issue is about Laissef-faire capitalism which hides behind the veneer of a “free market” while striving to make the market into a monopoly, usually with government protection, the reality being proto-fascism ?
It is quite obvious Bill that Rat is more concerned with semantics and technicalities than he is with the corporate malfeasance that Bernard is seeking to highlight in this article. Rat is also very keen to convey the impression that he has some deep and thorough understanding of the nature of free market economics.
God knows what sort of expectation he would have for a description (let alone a definition), of “communism”!
He’s probably a librarian, or even worse, a “libertarian”.
It is time Australia grew up. The system we have is a monopoly. If we want to stop it we need to open our airways or put Qantas back under public control. Having a monopoly helps no one except those who have their noses in the trough.
Australia is ridiculously stitched up in favour of monopolies or duopolies. There is very little choice for the consumer in so many areas.
It is difficult to imagine a worse ‘corporate citizen’ than QANTAS (albeit not impossible). That it seems to be one big PR concern with a few planes attached was illustrated when it recently claimed it had ‘democratised air travel for Australians’. Except it didn’t: that was actually Virgin Blue, when Ansett and QANTAS were a duopoly. The company’s habitual lies and spin are brazen and it remains sickening.