PM: big Ansett hand-out not on
By DARREN GOODSIR and SOPHIE DOUEZ
Tuesday 13 November 2001
Qantas safety staff in pay freeze strike
More reports at: Ansett crisis
Prime Minister John Howard has demanded that "realistic" wage and work practices be introduced for Ansett's new workforce before committing his re-elected government to support the airline's revival.
Mr Howard said yesterday that overly generous work conditions, out of line with rivals Qantas and Virgin Blue, contributed to Ansett's collapse.
Despite again ruling out an equity injection to assist the collapsed airline's sale to Melbourne businessmen Solomon Lew and Lindsay Fox, Mr Howard signalled the government was prepared to offer other forms of help with the airline's rebirth.
"We're not going to give $600 million to anybody to run an airline," he said, referring to the sum reportedly being sought by the Fox-Lew syndicate in cash, subsidies and tax breaks.
"If you give it to Ansett, there would be a queue a mile long," Mr Howard said. "But there may be ways in which we can, without committing the taxpayer to that extent, give some help.
"And we'll also have to be satisfied that the industrial relations arrangements proposed for the future are realistic.
"I want Ansett to fly again and I want Ansett to be competitive."
Deputy Prime Minister and Transport Minister John Anderson will today meet Ansett's administrators to discuss the carve-up of the airline's regional assets.
The discussion comes a day ahead of a meeting between senior government officials, the administrators and representatives of the Fox-Lew bid for the airline's trunk routes.
A spokesman for Mr Anderson said the government was still unaware of the exact details of government support required for the Fox-Lew bid to be successful.
The government has guaranteed workers entitlements through a loan of $195 million, to be recouped from the sale of Ansett's assets.
Media tycoon Kerry Stokes has put in a bid for Ansett's West Australian regional service, Skywest, which has been welcomed by the government.
Mr Stokes' bid for Skywest is believed to be less than $50 million for the entire business. The operation is profitable and would be expanded.
Tomorrow's meeting will brief senior representatives of the Departments of Prime Minister and Cabinet and Transport on details of the Fox-Lew bid.
Ansett's committee of creditors will hold a meeting on Thursday, where the would-be owners are expected to personally argue for their bid to be sanctioned.
It is likely Mr Howard will meet the parties next week, pending a successful vote at the creditors' meeting.
Sources close to the deal say the government appears to be softening its stance on a range of measures aimed at securing the sale.
Senior government officials are believed to be attracted to a compromise developed by the administrators that would see repayment demands relaxed on the $195 million Commonwealth loan for workers entitlements.
The $10 levy on domestic air travel would stop at New Year's Eve, yielding about $25 million to effectively pour into Ansett.
Taxpayers would be called on to grant about $30 million, with the remainder of the money - about $140 million - being repaid over a delayed period, possibly in the form of expected dividend earnings from Ansett Mark II.