Mr McADAM - 2002-02-27
Will the minister tell the Assembly what today’s news that the Ansett Mark II deal will not proceed means to the Territory?
ANSWER
Madam Speaker, it is indeed sad and disappointing news we had today that the Fox/Lew Tesna Consortium is not going to go ahead with their plans to purchase Ansett Mark II. We are still pursuing advice from the administrators in terms of what the prospects are in regards to some other consortium coming in to take carriage of that airline. But it is not good news and it is disappointing, not only disappointing for the tourism industry in the Northern Territory, but very disappointing for the ex-employees of Ansett who really have been waiting to get their jobs back. There is going to be a large number of very, very disappointed people around Australia tonight.
In terms of background, for the Assembly, for Territorians listening, when I met with Lindsay Fox and Tesna’s CEO, James Hogan, in Melbourne last month, they made it clear to me that whilst the Northern Territory was definitely in their sights, it was not part of their start-up plans. They were looking initially to fly predominantly the east coast routes in terms of building up their business and building up the viability of their business before they were looking to network into regional Australia. But certainly Alice Springs and Darwin were part of those future expansion plans.
In order to try to fast track those plans, I convened the NT Aviation Committee to be working with the Tesna consortium to help them build the business case for the Northern Territory. At the end of the day, the state of the airline industry at the moment, both nationally and internationally, is that unless there is a very solid and a very viable business case, those routes are not going to be committed to. Throwing buckets of money at people is not sustainable in the long term because that type of financial support cannot be sustainable in the long term, and those airlines really have to be viable on their own commercial merits.
The last thing that the tourism industry needs in the Northern Territory and Australia at the moment is another corporate airline failure, so working with the airlines to establish those business cases is seen as the way forward for the Northern Territory government. I counter that in stark contrast to comments from the federal member for Solomon, the opposition spokesman, who had been running around saying that we should have been throwing money at Ansett, we should have been throwing money at Flight West, and not looking responsibly to the actual commercial viability of these airlines. The last thing the tourism industry needs is another corporate airline collapse. And I do note that the federal member for Solomon, after he made his grandstanding statement just after Christmas, did not manage to secure any additional Commonwealth support for the Tesna bid, but he managed to get himself a headline in the Northern Territory and a particularly damning editorial, as I recall.
So, where are we now? We have two airlines, we have Qantas and we have Virgin. I suppose the good news that has come out of this is that at least Qantas and Virgin now know who the competition is and basically they are going to be competing with each other, and certainly we are working as well with Qantas and Virgin in terms of helping them establish that business case for the Northern Territory and for Alice Springs.
In talking about Qantas, I was very pleased to be at Darwin Airport last week when Qantas announced their new commitment to the Northern Territory, an additional 1000 seats in and out of the Northern Territory. Qantas, again, has come to the rescue of the Northern Territory tourism industry by putting on those extra seats that are going to be needed to boost our tourism industry. There was a public commitment from Steve Farquar, from Qantas, that he was pretty confident that we will get that extra capacity into Alice Springs by the middle of the year. I have also written to the Qantas CEO, Jeff Dickson, again today on the announcement of the Ansett bid, urging them to further expand their services into Central Australia, and continuing discussions with Virgin Blue.
The industry has been essentially in a holding pattern over the last few months, waiting to sort out who the competition is going to be. It is sad news that Ansett could not be resurrected by the Tesna consortium. However, the good news is that the two players now know who they are competing with, and that Central Australian market is there. I am pretty confident that, working with those operators, we will see that additional capacity into Central Australia in time for the tourism industry in June/July.
ANSWER
Madam Speaker, it is indeed sad and disappointing news we had today that the Fox/Lew Tesna Consortium is not going to go ahead with their plans to purchase Ansett Mark II. We are still pursuing advice from the administrators in terms of what the prospects are in regards to some other consortium coming in to take carriage of that airline. But it is not good news and it is disappointing, not only disappointing for the tourism industry in the Northern Territory, but very disappointing for the ex-employees of Ansett who really have been waiting to get their jobs back. There is going to be a large number of very, very disappointed people around Australia tonight.
In terms of background, for the Assembly, for Territorians listening, when I met with Lindsay Fox and Tesna’s CEO, James Hogan, in Melbourne last month, they made it clear to me that whilst the Northern Territory was definitely in their sights, it was not part of their start-up plans. They were looking initially to fly predominantly the east coast routes in terms of building up their business and building up the viability of their business before they were looking to network into regional Australia. But certainly Alice Springs and Darwin were part of those future expansion plans.
In order to try to fast track those plans, I convened the NT Aviation Committee to be working with the Tesna consortium to help them build the business case for the Northern Territory. At the end of the day, the state of the airline industry at the moment, both nationally and internationally, is that unless there is a very solid and a very viable business case, those routes are not going to be committed to. Throwing buckets of money at people is not sustainable in the long term because that type of financial support cannot be sustainable in the long term, and those airlines really have to be viable on their own commercial merits.
The last thing that the tourism industry needs in the Northern Territory and Australia at the moment is another corporate airline failure, so working with the airlines to establish those business cases is seen as the way forward for the Northern Territory government. I counter that in stark contrast to comments from the federal member for Solomon, the opposition spokesman, who had been running around saying that we should have been throwing money at Ansett, we should have been throwing money at Flight West, and not looking responsibly to the actual commercial viability of these airlines. The last thing the tourism industry needs is another corporate airline collapse. And I do note that the federal member for Solomon, after he made his grandstanding statement just after Christmas, did not manage to secure any additional Commonwealth support for the Tesna bid, but he managed to get himself a headline in the Northern Territory and a particularly damning editorial, as I recall.
So, where are we now? We have two airlines, we have Qantas and we have Virgin. I suppose the good news that has come out of this is that at least Qantas and Virgin now know who the competition is and basically they are going to be competing with each other, and certainly we are working as well with Qantas and Virgin in terms of helping them establish that business case for the Northern Territory and for Alice Springs.
In talking about Qantas, I was very pleased to be at Darwin Airport last week when Qantas announced their new commitment to the Northern Territory, an additional 1000 seats in and out of the Northern Territory. Qantas, again, has come to the rescue of the Northern Territory tourism industry by putting on those extra seats that are going to be needed to boost our tourism industry. There was a public commitment from Steve Farquar, from Qantas, that he was pretty confident that we will get that extra capacity into Alice Springs by the middle of the year. I have also written to the Qantas CEO, Jeff Dickson, again today on the announcement of the Ansett bid, urging them to further expand their services into Central Australia, and continuing discussions with Virgin Blue.
The industry has been essentially in a holding pattern over the last few months, waiting to sort out who the competition is going to be. It is sad news that Ansett could not be resurrected by the Tesna consortium. However, the good news is that the two players now know who they are competing with, and that Central Australian market is there. I am pretty confident that, working with those operators, we will see that additional capacity into Central Australia in time for the tourism industry in June/July.
Last updated: 09 Aug 2016