By Steve Painter
As many as 5000 jobs may be under threat at Qantas as a result of mismanagement of the national airline over the past decade.
The latest figure, which amounts to almost a third of the company's 17,000-strong workforce, is the fourth estimate following an initial projection of 500 sackings late last year.
Early this year, the figure was revised to 2000 and in mid-March to 3000. Then, in an interview with ABC radio on April 4, chief executive John Ward said between 3500 and 5000 jobs would be cut.
During the boom years of the '80s Qantas overexpanded; it is now facing a loss of between $350 and $500 million for 1990-91.
The loss is due to three main factors:
- the onset of the recession;
- the impact of the Gulf War on international travel;
- the company's agreement to subsidise the other partners in a consortium that bought a majority shareholding in Air New Zealand when that company was privatised in 1989.
Desperate to prevent British Airways from buying into Air New Zealand, Qantas bought 19.9% of the company itself and made secret deals with the other partners, Brierley Investments Limited, American Airlines and Japan Airlines.
Qantas agreed to subsidise Brierley if Air New Zealand dividends were not up to expectations in any particular year.
American Airlines and Japan Airlines got agreements that Qantas would guarantee their shares at a price of $1.92, well above the present market value. It is now in the process of buying American's 7.5% holding for an inflated price of just under $30 million.
Qantas' difficulties have probably dealt a blow to the federal government's plan to sell off 49% of the company.
Previously anticipating something like $500 million from the sale to help balance the budget, the government might now be forced to delay the Australian share issue by a year or more, though it could go ahead with a plan to put some shares on the international market.