The competition watchdog should examine the Albanese government’s decision to protect Qantas by blocking Qatar Airways from running extra flights from Europe to Australia, which would lower airfares significantly.
The Albanese government’s decision to protect Qantas by blocking Qatar Airways from running extra flights from Europe to Australia, which would lower airfares significantly for Australians and tourists wanting to visit, appears to prioritise the profits of a private company over cost to consumers.
International airfares are 50 per cent higher than they were pre-COVID. A key reason is the shortage of capacity, enabling airlines to take advantage of restored demand to raise prices sharply.Additional Qatar flights would have an immediate and tangible effect in reducing airfares between Australia and Europe, the Middle East and Africa while also providing more choice for businesses seeking competitive international air freight into these regions.
The Qatar bilateral expansion would add up to 1 million seats per year. Based on an industry average of around 50 per cent of seats being sold to overseas visitors into Australia, this would generate hundreds of millions of dollars in incremental visitor economic activity per year and more seats and lower fares for Australian customers travelling overseas.
Aside from the government’s decision to block Qatar Airways coming amid the highest inflation in decades, it is even more on the nose for having been made when we remember Qantas received $2.7 billion in federal government assistance during the pandemic, as well as $900 million in Jobkeeper payments; money it has no intention to return to the taxpayer.
In 1995, Australia adopted a National Competition Policy. A key principle was that no-anticompetitive decisions should be made by governments unless transparently shown to be in the public interest. The application of the principle has slowly faded over time.
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