THE FLYING KANGAROO-THE QANTAS AIRLINE DISPUTE & THE BIGGER PICTURE
White River, Kruger National Park, Cape Town ... these beautiful places were the location of my recent ministry trip to South Africa. Indeed, you can subdivide Africa into 3 parts:
Part One: North Africa, which is Arab;
Part Two: Sub-Sahara Africa, which is predominantly black; and
|South African Flag|
But there was one hitch to my otherwise flawless trip: to get there, I had to fly from Melbourne to Singapore via Singapore Airlines, and then on to Johannesburg. Total flying time: 17 hours. This is at least 3 hours longer than a direct flight from Australia. So why did I take the longer route? Cost! It simply was hundreds of dollars more for me to fly on my national carrier, Qantas (acronym for ‘Queensland and Northern Territories Aerial Service’). While I would have dearly loved to take the ‘Flying Kangaroo,’ it just did not seem worth the higher price.
I am not alone. Apparently 8 out of 10 Australians fly out of the country using another airline besides Qantas. A decade ago, it was 6 out of 10. Australia, which already has a reputation for being a ‘high cost-of-living country,’ extends this to the national airline.
This is at the heart of what has become a dispute of national importance between Qantas and three unions. Qantas, one of the few profitable airlines in the world, claims it is losing $200 million a year on its international routes. It wants to revamp, outsource, bring down costs, and become competitive. Asia is a key target. The hope is that Qantas can win back Australian customers, as well as attract many overseas ones, too. Without reform, the airline cannot compete in the global market. For example, Emirates Airlines from the United Arab Emirates has 159 planes and fly to 100 cities in 65 countries. Qantas has 156 planes but only flies to 16 cities in 12 countries.
The 3 labour unions are seeking higher wages (2.5 to 3.5%) but the bigger issue is ‘job security.’ Slogans thrown around include ‘keep Qantas pilots flying Qantas planes,’ and ‘don’t send Australian jobs off-shore.’ Union negotiations with Qantas began 12 months ago and there have been over 200 meetings! Unions have been calling for strikes and other industrial action over the last while that has affected 71,000 passengers, cancelled 129 flights, and delayed another 387 flights. Qantas claims it has lost $68 million due to industrial action with another $15 million lost each week. The unions promised to continue this ‘campaign of attrition’ for another 12 months. Add to this scenario the specter of rising fuel costs, failure to pay shareholders a dividend, and who have an intolerable situation for any company.
So on Saturday night 29 October 2011, Qantas CEO Alan Joyce took the unprecedented step of grounding all Qantas flights and locking out the employees. Of course, 1000s of passengers were affected both in Australia and overseas. Finally, Australian Prime Minister Julia Gillard, who was chairing the Commonwealth Heads of Government Meeting (CHOGM) in Perth, took action. She referred the matter to ‘Fair Work Australia,’ which declared that all industrial action (strikes) must cease and the lock-down lifted. Qantas and the unions have 21 days to settle the dispute or face arbitration (which could benefit Qantas in the end). By Monday 31 October, Qantas had resumed flights. What had dragged on for over a year was now heading towards a settlement in less than 48 hours. Inconvenienced passengers have been promised full refunds within the next two months.
What does this crisis mean? For one, it is more than just an industrial dispute; it is of national interest. Australia is an island and it is more heavily dependent on air travel than most nations. It is important that it has a viable and competitive national carrier to service our national interests. While I normally favour minimal or non-existent government involvement in general life, this matter is just too important to leave to mere market forces alone.
Under the governments of Bob Hawke, Paul Keating (both of the same left-leaning Labor Party as Julia Gillard) and John Howard (Liberal or conservative party), the labor market was de-regulated and union action was minimal. Under the recent Labor governments of Kevin Rudd and Julia Gillard, labor has been partially re-regulated. On all appearances, since the passage of the Fair Work Act 2009, which Julia Gillard, a former industrial relations lawyer helped author, there has been an increase in union militancy. In the November 3rd edition of The Australian, page 1, it says:
Prominent union leader Tony Sheldon has conceded his union’s bid to force Qantas to submit to contentious job security clauses would not have been possible under the Howard government and was only achievable after Labor changed workplace laws.
Lost days to industrial action have multiplied just in 2011 alone. According to the same article, is says:
Latest ABS (Australian Bureau of Statistics) figures show industrial disputes rose in June quarter to 66,2000 days lost, up from 19,700 in March. Last financial year 159,800 compared to 126,500 the previous one.
Having a union-friendly Labor Government at a Federal level appears to have contributed to this militancy. Qantas is not the only major business facing the unions, but it is probably has the highest profile. While there is a place for constructive union involvement, they should not be allowed to tell the company how to run its business nor bleed our national carrier to the point of extinction.
A bigger issue looms: it is called ‘globalization.’ This much used, little understood word, means the free movement of goods, services, people, money, and ideas. It is free-market (capitalism) fueled and, like it or not, represents the world order in the early years of the 21st Century. Qantas has to be able to compete with other carriers or eventually diminish or disappear altogether. As unpalatable as it may sound, outsourcing overseas, with lower wages, may be part of the answer. Qantas has 35,000 employees and some well-paid pilots (one figure has pilots earning $540,000 while the prime minister makes $386,000). Pilots should be well-paid -- our lives are in their hands. But competitiveness of the company is the key.
While the unions keep asking for guarantees of ‘job security,’ the truth is that there is no such thing in today’s globalized world. Private sectors cannot guarantee this in a changing market and, yes, even the public (government jobs) sector, with massive and unsustainable deficits, can no longer promise life-long employment. What’s the point of asking the impossible from Qantas, forcing it to keep its prices high, face the prospect of even less Australian customers, and then possibly close down altogether? Is it not better to lose 1,000 jobs to overseas workers, than to lose the jobs of the other 34,000?
For any person of faith reading this blog, remember there is only one means of security -- faith in the living God and obedience to His Word. In our present and coming times of shaking, the only safe place to be is ‘on the rock,’ where neither winds, waves, and floods, can wash us away. The only way to get to ‘the rock’ is to hear and do the words of Jesus (Matthew 7:24-25). If you want security in these insecure times, open your life to the wise counsel of Scripture and the Name of the LORD -- a high tower that keeps all who take refuge in it safe (Proverbs 18:10).