Australian taxpayers may fund Qantas deal

By GREG ANSLEY

CANBERRA - Australian taxpayers may subsidise plans by Qantas to lease aircraft and crews from the Ansett administrator to cope with a huge backlog of traffic caused by the collapse of its former rival.

Prime Minister John Howard raised the possibility in Parliament yesterday as attacks on his Government increased following the disclosure that Qantas was negotiating the lease of two Air Canada Boeing 767 airliners.

Qantas turned to Air Canada after talks with Ansett administrator Mark Mentha stumbled on the price the Australian flag carrier was prepared to pay for the lease of grounded jets and crews.

Mr Howard said he was disturbed by the Qantas move and indicated the Government could help with the cost of insurance if it did not expose taxpayers to unacceptable risk.

"I learned of this proposal last night [Tuesday] and within an hour of learning of it I told both the chairman and the managing director of Qantas that it was unacceptable to the Government that foreign aircraft and crews should be brought in while there were Australian aircraft and Australian crews ready and willing," he said.

Mr Mentha met acting Air NZ chairman Jim Farmer and Australian Council of Trade Unions national secretary Greg Combet yesterday. The talks produced a promise from the New Zealand airline to provide all information needed to establish Ansett's true financial position.

Air NZ lawyers also appeared before the Industrial Relations Commission in Melbourne in the hearing to determine if the airline is liable for Ansett staff entitlements amounting to $A500 million ($NZ600 million).

The commission is expected to hear an application by Air NZ for a stay of its ruling last week that there is a dispute between it and aviation unions, ahead of an appeal to its full Bench.

The commission hopes to wind up the hearing by tomorrow, although this remained uncertain yesterday and there was no indication of when a decision would be brought down.

Meanwhile, the Senate has set up its own inquiry into the Ansett collapse. This is in addition to the commission hearing and an Australian Securities and Investment Commission probe.

But in better news, the administrator of Ansett subsidiary Hazleton Airlines said he hoped to have it flying again by the weekend, and prospects appeared good for an early sale of the Ansett's Traveland group.

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