Focus Live: The Government is handing Air New Zealand a $900 million lifeline as it copes with the coronavirus fallout.
Cabinet minister Shane Jones has taken a swipe at the pay levels at the top of Air New Zealand and says the airline needs to change direction to help rebuild regional economies.
Saying it was a personal view, the Minister for Regional Economic Development said it was time for theairline to accept the days of global expansion were over and that its managers needed to ''bite the bullet'' over pay. The airline has said its top executives' pay could nearly halve.
''They're going to have to go and test their economic worth in a post-Covid economic environment and stop believing they've got they've got a job for life,'' said Jones.
''I've got every right to put that challenge to the executive class of Air New Zealand because every three years I put my self to the test in the political market.''
Salary figures from last year's annual report show 31 Air New Zealand managers were paid more than what Jacinda Ardern earned then - $471,000 (before she took a 20 per cent pay cut due to the coronavirus austerity.)
The figures also showed 44 ''aircrew, engineering, overseas and other staff'' were paid more than the PM last year although none made it into the $1m plus bracket.
Out of a workforce of about 12,500, 1335 in Air NZ management and 2298 the second category were paid more than $100,000.
More than 3000 staff are now being laid off from the airline which has a $900,000m Government bailout loan to tap into to help it survive. It has also claimed $72m in wage subsidies.
Many are cabin crew and other staff paid less than $100,000.
Jones said he was ''very averse'' to restructuring that targeted those on lower pay.
''That is one thing I resent about the New Zealand corporate culture is that the executive class shaft the little people and continue to dine at the banquet table and not want to accept that their value has diminished and their value has reset,'' said Jones who is also Associate Transport and SOE Minister.
''Don't just focus on the little people -they are the arms and legs - the ringaringa and waewae of a business,'' said Jones, who has a history of friction with the airline.
He has previously clashed with former Air NZ boss Christopher Luxon and its former chairman Tony Carter over services to the regions, where his party aims to build up its base of political support.
An Air NZ spokesman said the 10-member executive had taken a 15 per cent salary reduction and will not receive short-term incentive payments in this financial year.
This meant their average annual earnings would be down 42 per cent compared to the previous financial year.
Former Air NZ boss Christopher Luxon and Shane Jones have clashed in the past. Photo / Thomas Bywater
As the crisis hit Air New Zealand chief executive Greg Foran cut his base pay of $1.65 million by approximately 15 per cent or around $250,000.
The spokesman said that the redundancy process was not about reducing the number of staff who earn less than $100k and not touching those who do.
Both management and operational staff earning over that were in negotiations over their jobs.
Speaking before Air NZ's announcement on resuming some domestic flying, Jones said he and NZ First party leader Winston Peters wanted to see the airline work for New Zealanders.
''My personal view is that Air NZ needs to accept that the global Christopher Luxon model is over and they are clear enablers for regional growth and regional rejuvenation,'' said Jones.
''We're going to ensure that Air NZ works for New Zealanders, not just international travellers and they're going to have to cut their cloth, trim their ambitions and reflect the culture that is respectful of the fact that if it wasn't for the taxpayers, they would be defunct.''
The Government spent $885m bailing out Air NZ in 2001 after it came close to collapse but since it has been paid it just on $1.4 billion in dividends.
