Qantas Deal Anti-Competitive

"The Qantas Deal is anti-competitive," ACT Leader Richard Prebble said today.

"The benefit to shareholders comes directly at the expense of the customer in reduced competition.

"A decision by Qantas to continue with a domestic airline in New Zealand, which the management claims is losing money and is now going to be under Air New Zealand management, appears to be nothing more than a technique to block Virgin or any other airline entering the market.

"Qantas domestic is under-capitalised and the airline is run with too few aeroplanes which often causes long delays.

"The whole project makes no sense except as a way of blocking a rival by continuing to hold key gates at domestic terminals.

"It also leaves the government in the worse possible situation - still an investor but no longer controlling the airline.

"The sale is not in New Zealand's interest as it will remove real competition in the country and lower competition on the Tasman. The government has a conflict of interest in its desire to reduce its risk as a shareholder and its duty as a government to promote competition in aviation.

"If Labour knew anything about business, they would recognise the solution. Say to Qantas - buy not only 22.5% but all of the government's shares and sell Qantas New Zealand.

"I do not believe that the domestic ownership clause in our bilaterals is an insurmountable obstacle. A deal like the one I propose would achieve increased competition, better management and would take the government out of the business it knows nothing about.

Labour won't do this because it is ideologically opposed to privatisation," said Mr Prebble.

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