Qantas: How Privatisation Guts Public Services

Leon Hayes

24/08/2022

If someone you know has flown Qantas recently, chances are the experience was negative. Lost luggage delayed or cancelled flights, hours wasted waiting for luggage or on the phone to customer service. The failures of Australia’s major airline are affecting the plans and lives of millions of working Australians.

What Is Going On?

Qantas’ official line is to blame the pandemic. Indeed, Qantas’ domestic and international CEO, Andrew David, said so in an op-ed published last month [1]. “The truth is that the difficulties we are now facing are because of COVID and flu related sickness,” he claims, “as well as an extremely tight labour market.” He assures us though, that this isn’t an issue with Qantas, nor is it a domestic issue, but something that is reflected internationally. David said in an interview with Perth radio station 6PR that “… we don’t have a magic wand that we can instantly address [the impact of COVID]” [2].

It’s impossible to deny the impact of COVID; however, to attribute all Qantas’ current problems to the pandemic is naïve. Qantas is one of the worst performing airlines domestically, with only 58.4 per cent of flights leaving on time, and 59.1 arriving on schedule in June. In contrast, the best domestic performer, Rex Airlines, had 82.7 per cent of flights departing on time, as well as 80 per cent on-time arrivals [2]. Clearly, despite COVID, other airlines are performing quite well, while Qantas is struggling. 

So, if the Issues With Qantas Aren’t Solely Due to COVID, Then What Other Problems Are There?  

If a public service is owned by private interests, then it will be run – not for the good of the people using that service – but for the profits of its shareholders. What is happening with Qantas at the moment is in no small part due to it being privatised in the 1990s. The pandemic has accelerated the tensions between the business bottom line and the rights of those who use and work for Qantas. 

Let us use baggage handling as an example. Alan Joyce, the CEO and managing director of Qantas, deflected the blame for the mishandling of baggage onto airports’ management. When Brisbane and Sydney airports suffered an IT outage, he claimed that the delayed baggage was “an airport service issue, and that it clogged up the system” [3]. While the outages contribute to the baggage delays, the main source of the delays lie in a shortage of Qantas staff.

These staffing issues can be traced back to the height of the pandemic, when up to 9,000 jobs were terminated [4]. 2,000 of these terminated jobs were outsourced. These jobs included cabin cleaners, ramp workers and baggage handlers [5]. Ground crew jobs were outsourced to the tax-haven based Swissport – reliant on both casualisation and unsafe work practices [6]. In short, Qantas fired and outsourced baggage handlers so they can pay less in wages and make more profits.

The tensions between Qantas management and staff aren’t limited to baggage handlers. Aircraft Engineers – in spite of their crucial position in ensuring the safety and operation of the fleet – haven’t received a pay rise in over four years. As a result, they are on the brink of taking industrial action against Qantas [7]. Pilots have been the recipient of strong-arm tactics over how they would be paid to fly new Airbus aircraft, with the pilots’ union claiming that – much like the baggage handlers – their members would be outsourced if they won’t agree to the deal [8].

The people who keep the planes running and in the air are suffering due to management cutting costs and maximising profits.  Of course, if the baggage handlers, engineers, pilots, and service crew were to quit – or went on strike – it would result in chaos. In 1989, when the pilot union had an industrial dispute over wage suppression, the then PM Bob Hawke showed his solidarity by using the air force as strike breakers. In other words, pilots withholding their labour was so threating to the interests of the ruling class that the armed forces were sent in to ease the impacts of an industrial action. The bosses also received significant support from the ALP and successfully recruited new pilots from overseas [9]. Similarly, in 2011, during a dispute over new enterprise agreements, Alan Joyce grounded Qantas’ entire fleet – leaving 200,000 passengers stranded without notice. 

If the CEOs, executives, and shareholders resigned wholesale, what would be the effect? Do they fly the planes? Do they repair the engines? Do they handle the luggage and the cargo? Of course not. They largely sit in their mansions and suck as much money out of Qantas and its workers as they can. As Professor Greg Bamber puts it, Qantas is trying to “…maximise profits and prioritise the interests of shareholders and executives at the expense of its staff and its customers” [10]. Even if that means outsourcing jobs, cutting corners, and making working conditions worse. 

In light of these many issues, Qantas has pocketed $2 billion of tax-payer money in COVID payments and has signed off on performance bonuses to executives that are worth up to $1 million each [10].

Qantas has gone down the same path as privatised services. Its service levels have degenerated, its staff have been repeatedly cut back and outsourced, and the customer foots the bill for the negative effects. Qantas needs to be renationalised and placed back in the hands of the people for the interests of the people rather than the interests of a few.  

References:

[1] https://www.qantasnewsroom.com.au/featured/qantas-op-ed-explaining-whats-happening-with-air-travel-right-now/

[2] https://www.abc.net.au/news/2022-07-24/qantas-crisis-delay-cancel-aviation-fuel-covid-impact/101262422

[3] https://simpleflying.com/australia-qantas-flight-cancelations/

[4] https://www.abc.net.au/news/2022-07-24/qantas-crisis-delay-cancel-aviation-fuel-covid-impact/101262422

[5] https://simpleflying.com/australia-qantas-flight-cancelations/

[6] https://www.crikey.com.au/2022/06/23/qantas-alan-joyce-another-failure-privatisation/

[7] https://www.news.com.au/travel/travel-updates/qantas-aircraft-engineers-will-almost-certainly-take-industrial-action/news-story/d0459bc4832800214c776c2ee11e9705

[8] https://www.abc.net.au/news/2022-07-24/qantas-crisis-delay-cancel-aviation-fuel-covid-impact/101262422

[9] https://en-academic.com/dic.nsf/enwiki/1508682

[10] https://www.abc.net.au/news/2022-07-24/qantas-crisis-delay-cancel-aviation-fuel-covid-impact/101262422