Qantas CEO Alan Joyce faces a huge task to rebuild his credibility after a morning of intense questioning before the Senate inquiry into the Qantas (Still Call Australia Home) Bill sponsored by Green leader senator Bob Brown and independent Senator Nick Xenophon.
Several hours into the hearing Senator Doug Cameron clashed with Joyce saying he was “trying to get an idea of the thinking behind this crazy idea of Qantas to ground the airline . You’re like Richard Nixon trying to talk your way out of everything.”
Joyce responded “You’re a bit like a McCarthy trial at the moment …”
The senators were unaware of the drama going on aboard QF31, a Qantas A380 flying from Singapore to London, which has made an emergency landing in Dubai after an engine failure.
The incident comes on the first anniversary of the incident in which the A380 operating QF32 suffered a catastrophic engine failure after departing Singapore for Sydney. It is still on the ground at Singapore airport undergoing a massive reconstruction.
Joyce may have been handed an alert about the incident just before his extended appearance before the Senate inquiry ended. It was hard to discern on the live streaming broadcast of proceedings.
In the session Cameron accused Joyce of deliberately destroying the Australian economy to try and get his way, and Joyce responded very clearly that the actions he took entirely on his own using his operational discretion were absolutely essential to save Qantas from a death by a thousand cuts and that he was justified in enlarging the dispute by shutting down the airline to force a show down in Fair Work Australia leading to the shutting down of lawful industrial action by its pilots, licensed engineers and ground staff.
The chairman of the Senate Committee Senator Glenn Serle said there were a huge number of questions arising from Joyce’s testimony and Cameron said he was going to study the Hansard very carefully to frame those that would be pursued when a return session with the Qantas CEO was scheduled.
During the session Senator Brown accessed Joyce of deliberately misleading parliamentarians in the weeks before the grounding as to its premeditated plan to lock out staff and passengers.
In the opening stages of today’s inquiry into Still Call Australia Home amendments to the Qantas Sale Act of 1992 Joyce said the Qantas group would have to be split up and Jetstar and its Asia interests sold if the legislation is amended as proposed. However he told the chairman, Senator Glenn Sterle, that Qantas is not considering or planning to break up the airline group and sell off some assets and it has not been discussed at board level.
The amendments would stop Qantas using subsidiary investments to transfer assets offshore to some extent, and would outlaw the rotation of Asia based flight crews through domestic services.
Grilled by Serle about the illegality of Qantas continuing to sell tickets after it had decided to ground the fleet, Joyce briefly laughed and said it was a mistake but was pulled up by Serle who said “it was not a little mistake”.
Serle expressed incredulity that Qantas did not discover its mistake in continuing to illegally sell tickets after its decision to ground the fleet until 8.30pm, three-and-a-half hours after the grounding that left it with no real product to sell (contrary to law).
Joyce also insisted that Qantas did not book any more rooms than usual in hotels around the world in the four days before the snap grounding decision than normal, and disputed that letters to 30,000 Qantas staff concerning the shutdown had been printed or couriers booked, days in advance.
He then said the formal notifications after the 10.30am board endorsement of his grounding decision last Saturday were not printed until 11.30am for distribution not before 5pm and that the couriers were not booked until well after the shut down.
Serle asked if it was normal for Qantas to book several thousand hotel rooms in advance for a Saturday night in Singapore or Los Angeles, and Joyce indicated that it was. He undertook to provide written proof as to when the Qantas hotel rooms were booked in both ports, when the notifications were printed and when the couriers were engaged.
Serle told Joyce he had the most honest face at the table, but he had to satisfy other senators.
In answer to questions from Xenophon, Joyce confirmed he made the grounding decision alone using his unlimited delegated authority in operational matters. He had referred it to the board because of its implications for the brand and for their endorsement.
Joyce told the inquiry that Qantas might not have survived a year because of the rate at which forward bookings were collapsing. He said that in October actual sales of higher yielding business fares were down by 40% on the prime east coast route, off by 14% on Perth routes and down by 7% on Canberra routes.
In a late development the committee will go in camera shortly to see emails to Qantas employees confirming that management had planned the grounding more than a week before Joyce claims to have woken up and taken a spontaneous decision.