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Australia, it's time to deregulate the skies

By Jonathan J. Ariel - posted Friday, 12 June 2015

It was due to take place on Tuesday afternoon.

But yesterday there was no mention of it in the press. Nothing.

Cabinet members, divided as they were on the policy, seemed to prefer either to kick the agenda item down the road by delaying its discussion to a future cabinet chinwag, or they did canvass the issue but prefer not to remind us voters (via a press release) of just how useless they are in promoting the public interest in the face of strong arm-twisting by pressure groups.


It's the Medicare co-pay fiasco all over again. With the same hapless actors. This time with wings.

The matter that should have been debated was a proposal to allow foreign airlines to ply domestic routes in northern Australia.

Last week Fairfax Media presaged that the proposal will be unceremoniously dumped "due to concerns it will undermine regional carriers, Qantas and Virgin Australia".

This is code for Cabinet members folding like a deck of cards in the face of assiduous lobbying from the airlines, its unions and its foghorns. These protectionists are united in their objective to keep their jobs at the expense of Australians being denied the joy of flying the deregulated skies and benefitting from the lower fares competition will bring.

Trade Minister Andrew Robb, whose hat collection includes "tourism", in an effort to boost economic activity in the "Top End", argued to allow foreign carriers to fly between airports above the Tropic of Capricorn, including Cairns, Darwin, Broome and Port Hedland. Ideally that would soon after extend to flying say Darwin-Melbourne or Cairns-Sydney as well.

But alas Fairfax Media claims he was recently rolled.


And Joe Hockey, the guy keeping the Treasury seat warm for the Minister for Social Security, while initially receptive to the winds of competition, over time turned to jelly on the matter.

This is the same Joe Hockey who last year couldn't sell the Federal Budget; this year had the job of selling the budget privatised (by his boss) to Scott Morisson; spectacularly failed to argue the abundant merits of the Medicare co-pay initiative and on Tuesday in Parliament ridiculed those Australians who are frustrated with their inability to buy a home in Sydney. His poor performance will no doubt cost the government a few points in the forthcoming opinion polls.

Deputy Prime Minister and National Party leader Warren Truss also stood steadfast against introducing competition into the airline industry.

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About the Author

Jonathan J. Ariel is an economist and financial analyst. He holds a MBA from the Australian Graduate School of Management. He can be contacted at

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