Andrew Leigh

E&OE TRANSCRIPT
PODCAST INTERVIEW
THE BRIEFING
THURSDAY, 7 SEPTEMBER 2023 [RECORDED 6 SEPTEMBER]

SUBJECTS: Voice to Parliament, competition in aviation, Qatar decision, Qantas, cost of living.

TOM TILLEY (HOST): Andrew Leigh is Labor's Assistant Minister for Competition, so he's in the hot seat right now because competition is what the Qatar/Qantas issue is all about and it comes at a time where the Government is under a bit of pressure. More pressure than they've been under their whole time in office.

Support for the Coalition is at its highest level since the 2022 election last year. Opposition to The Voice is polling at 53 per cent. As I mentioned at the start, Albanese's net satisfaction rating is in negative territory, and of course the Qatar Airways decision made in June is causing them a lot of problems. There's now a Parliamentary inquiry that's going to happen into that decision.

So let's let into it with Andrew Leigh. Minister Leigh, thank you so much for joining us on The Briefing.

ASSISTANT MINISTER FOR COMPETITION, CHARITIES, TREASURY AND EMPLOYMENT ANDREW LEIGH: It's a real pleasure, Tom, great to be with you.

TILLEY: Yeah, great to have you on the show. Since your big election win last year Labor's had a big, long honeymoon, you've been very popular with voters. But that seems to be changing. Is it fair to say the honeymoon is over?

LEIGH: Tom, I've never followed polls, and this goes all the way back to when I was an ANU academic and did some studies looking at the inaccuracy of opinion polls. Invariably if you're a reforming government then some people are going to like reforms, others aren't. The only way of getting everyone to love you is by sitting back and doing nothing. But that's not the Labor way.

TILLEY: As we'll discuss there's a lot of pressure on you over the Qatar decision. You're also leading a referendum campaign that appears to be losing. Are you losing trust or credibility with voters?

LEIGH: I don't think so, Tom. It's certainly not the feedback that I get when I'm out in my street stalls. People who I speak to are enthused about the idea that for the first time since Federation our founding document might recognise the first inhabitants of Australia.

TILLEY: Yeah, well both sides agree on recognising them in them constitution but there's obviously a massive split on The Voice and so far you're not taking the public with you, the No campaign is winning but let's see how that goes.

Let's move on to the Qatar decision which is causing a lot of headaches for the Government. The proposal was 21 extra Qatar flights a week, blocked by your Transport Minister supposedly in the national interest but it's not in the interests of customers who are now paying up to 40 per cent more for flights. It's not in the interests of our tourism industry. It only seems to be in Qantas' interest.

LEIGH: Well, Tom, there's a range of factors taken into account by the Transport Minister when she makes that decision.

TILLEY: But she hasn't explained what they are. She gave a press conference last week and she said, "I won't go into the individual factors", so it doesn't seem like your Government's been able to explain why it was in the national interest. That's why you're in this problem.

LEIGH: Qatar is welcome to fly as many planes as it wants to into Canberra. In fact in the pre‑pandemic era there was a Qatar flight into Canberra on a regular basis which was welcomed by Canberrans.

TILLEY: Come on, Andrew Leigh, that doesn't cut it. Canberra's a very small city, you know, compared to Sydney or Melbourne. That's where the tourists what to come into. That's where people need to fly out of. It feels like you're sidestepping the issue.

LEIGH: Tom, Canberra's the fastest growing State or Territory in Australia according to the last census, ‑‑

TILLEY: It's still small.

LEIGH: ‑‑ and they can do the same in Adelaide, they're welcome ‑ Qatar is welcome to fly unlimited flights in there. We're also expanding flights from a range of other carriers, including China Southern, and we are expecting new applications from Turkish Airlines and Vietnam Airlines.

You know, there are a range of these international agreements. Sometimes airlines will get what they ask for, other times they won't. There are many Australian carriers that would love to fly directly into Europe, Singaporean carriers who would love to fly into the United States. There is a highly competitive ecosystem in Australia in terms of international flights.

We're certainly engaged in looking at how we can improve competition, and I wouldn't want to pretend that Qantas in any way has always been doing the right thing by the flying public. I've been very critical of Qantas, for example, over flight cancellations on the Sydney/Canberra leg where they're cancelling one in eight flights, or over the treatment of passengers who are owed flight credits from the COVID era, which I think should just be cashed out by Qantas.

TILLEY: Look, Andrew Leigh, it seems like you, Catherine King, you can't explain why this was in the national interest. You keep sidestepping it talking about flights to Canberra, you talk about other airlines, but you can't explain this decision. So maybe there isn't a good explanation. Can you just maybe admit that you got it wrong? You made the decision in June, since then you've found out Qantas has a record profit and is doing fine, thank you very much. You also found out how badly they're treating their customers, that they were booking 8,000 tickets on flights that didn't exist and say, "Look, we've changed our minds. That was a decision we got wrong. Let's move forward".

LEIGH: Tom, I know there's this Liberal talking point out there about the national interest, but the fact is that a national interest criterion exists in a range of contexts in legislation. It's there, for example, in foreign investment screening. It allows the Minister to take into account all the relevant factors. I'm not sure it's particularly helpful to ask me what is in Catherine King's mind when as decision maker she made that decision on the national interest.

TILLEY: This is about competition, that's why we've got you on The Briefing.

LEIGH: Absolutely.

TILLEY: Because it's in the portfolio you work on, it's a crucial element here.

LEIGH: No, and we're certainly keen to see more competition. And I'm talking to you not only about the narrow Qatar decision but also about the fact that you have to see the broader picture here. You have to recognise the international context in which these approvals are made. It's worth recognising the ways in which Qatar can currently expand capacity, not only by flying into places like Adelaide and Canberra, but also by flying bigger planes into their existing routes.

Qatar has the option of expanding capacity. Other airlines are expanding capacity. I'd like to see a lot more competition both internationally and domestically within our aviation sector, and that's something that the Aviation White Paper process is going to be looking carefully at, alongside the competition review that Jim Chalmers and I have set up in Treasury.

TILLEY: So you, as we've just discussed, you know, the Assistant Minister for Competition, that's a huge part of what you do, that's an important role for you in the Government, so did Catherine King talk to you about the Qatar decision?

LEIGH: That's not the way these decisions work, Tom. These decisions are made by the Transport Minister themselves, just as the ‑‑

TILLEY: But surely you'd talk to the Competition Minister?

LEIGH: -- the legislation gives the power to the Transport Minister. That's how the process pans out. My job is to look at some of those broader competition settings. Our competition review isn't set up to focus on any individual sector. It's set up to take a broad look right across the economy.

TILLEY: So almost a year and a half into this term of Government is this Qantas/Qatar crisis starting to hurt? Are there conversations internally? You've had people backing away from Stephen Jones's explanation of the decision, Catherine King's getting up at press conferences and almost saying nothing, Alan Joyce has had to leave the job early. It sort of leaves you guys as the last man standing sticking up for Qantas. Is it hurting?

LEIGH: No, Tom, I don't think I've been sticking up for Qantas. In fact I've been very critical of Qantas over the issue of JobKeeper, the way in which the former government didn't include any repayment requirements; over the flight credits, over the flights to Canberra. Certainly, I think that Qantas can do a better job by the travelling public and the issues that it is facing with the ACCC inquiry add further to that.

You need to see this in a bigger picture. I appreciate your fascination with what's on the front page right now. Our focus as a government is to look right across the macroeconomy.

TILLEY: Okay, so one of the biggest problems we're all facing at the moment is the cost‑of‑living crisis and there's a feeling in the community that mortgage holders are doing their bit, they're facing record increases in their interest rates, so they're doing it really tough. But potentially our big corporations maybe aren't doing their bit, that they're jacking up prices and profiteering from this inflationary environment. What are you doing to make sure that's not happening?

LEIGH: Well the ACCC's inquiries into price gouging are important here and the ACCC's doing a range of investigations where it sees firms misusing their market power.

We need to make sure as a government that we're providing cost‑of‑living relief. The cheaper childcare reforms, the cheaper medicine reforms, the direct energy bill relief are an important part of that. By doing those measures in a targeted fashion we've ensured that the last budget not only didn't put upward pressure on inflation but actually worked with the Reserve Bank in order to bring inflation back down.

Inflation now isn't where we want it, but it is moving towards the target band, and that's marked by the fact that the Reserve Bank yesterday decided to keep the cash rate on hold at 4.1 per cent.

TILLEY: So the start of your answer there was about the ACCC making sure that there isn't profiteering? Is that enough? Is there more that you could be doing as the Government to make sure companies aren't profiteering? You know, in the recent record profit announcement from CBA they said that the higher interest rates were part of the reason they made an extra profit. That went down pretty badly with a lot of people.  People looking at the big two supermarkets and the way they're setting their prices. Is there more that could be done here?

LEIGH: Yeah, well you've gone directly, Tom, to the issues that helped underpin us setting up the competition taskforce in Treasury. That competition task force is set up in a broad multi‑decade decline in the dynamism in the Australian economy, but also in the particular context of this cost‑of‑living challenge and the inflationary pressures many Australian households are feeling.

We haven't seen a price spike over the last year merely because of a lack of competition. The drivers of that are more in the area of war in Ukraine and busted supply chains. But it doesn't help when you've got markets that aren't as competitive as they could be.

TILLEY: So reviews are great, but people sort of read that in the paper and go, "Oh, another review. What about action and how far away will that be?"

LEIGH: It is important to understand that this isn't a task force which is aiming to hand down a report, Tom. It's aiming to bring direct actionable ideas to government which we look to implement into legislation. It's working immediately rather than carrying out an abstract exercise.