The Queensland Government is offering $200 million to help rescue Virgin Australia but says it will not be enough to keep the airline afloat.
Key points:
- Queensland's funding is conditional on the Federal Government leading a response
- Other states and territories are asked to chip in
- Virgin Australia would also need to restructure debt, keep regional flights and maintain its headquarters in Brisbane
Minister for State Development Cameron Dick said the Federal Government must lead a national response, which should include additional funding from the states and territories.
The airline has asked for a $1.4 billion loan from the Commonwealth to help it through the coronavirus pandemic, but it has so far been offered a share of $165 million.
Mr Dick said the Queensland funding was conditional on the Federal Government backing, as well as debt restructuring, shareholders and bond holders doing their bit, headquarters remaining in Brisbane and ongoing regional flights.
"Queensland can't do this on its own," he said.
"If we are going to have two national airlines at the other side of this pandemic, then all governments need to come together to ensure that is the case.
"We know that on routes where there is only a single carrier, the cost of flights can be 20 to 25 per cent more than where there is competition.
"To have competition means that prices are lower and that's in everyone's interests."
Yesterday the Federal Government announced it would spend $165 million to get Virgin and Qantas to run a baseline domestic service for the next eight weeks but did not commit to a bail out, saying its confident the market will come to Virgin's rescue.
The news was not enough to stop the company from holding a meeting with unions and experts to discuss ways to avoid going into voluntary administration.
Thousands of staff have already been stood down and the company has gone into a trading halt.
Mr Dick said he was yet to speak with any other state or territory government about their willingness to contribute to a bailout.
But he said the prospect of foreign buyouts demonstrated the need for a national response.
"Any international investment underlines the point that it has got to be a national response to ensure the airline can continue."
https://news.google.com/__i/rss/rd/articles/CBMibWh0dHBzOi8vd3d3LmFiYy5uZXQuYXUvbmV3cy8yMDIwLTA0LTE4L3Zpcmdpbi1vZmZlcmVkLSQyMDBtLWNvcm9uYXZpcnVzLWxpZmVsaW5lLWZyb20tcWxkLWdvdmVybm1lbnQvMTIxNjA5NDbSASZodHRwOi8vYW1wLmFiYy5uZXQuYXUvYXJ0aWNsZS8xMjE2MDk0Ng?oc=5
2020-04-18 01:35:43Z
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