''Qantas is operating as a fully independent, freestanding company without any government support or subsidy, that is not always the case with foreign airlines, including Singapore Airlines."---Aussie Prime Minister, John Howard.December 10, 2005.
What SIA said:"Let me say absolutely, Singapore Airlines does not, and never has, received subsidy from the Government of Singapore," said its head of public affairs, Stephen Forshaw.
"That's just Qantas spin which isn't backed by fact. Let's be clear, in this debate the airline that benefits financially the most from support from government is Qantas, because of its protection from competition on the Australia-USA route."
Mr Forshaw said the protection of Qantas on the route amounted "to a hidden subsidy".
"We derive no support from Government," he said. "We pay commercial landing fees, tax in line with the company tax rate in Singapore, and play by exactly the same rules as any other company incorporated and based in Singapore, including Qantas's own subsidiary, Jetstar Asia."
Qantas received the subsidyQantas has argued it will be disadvantaged if Singapore enters the LA route, given the Asian carrier enjoys not only government ownership but also more favourable depreciation tax rates. However, Qantas critics point out the Australian carrier has been a bigger beneficiary of government handouts in recent years. In 1992, the Federal Government paid off $700 million of 's debt when it absorbed Australian Airlines.
Singapore Air has claimed Qantas's dominance of the route is costing Australia $126 million in lost tourist revenue a year. Federal Tourism Minister Fran Bailey supports having an extra airline on the route.
The head of Australia's largest travel retailer, Flight Centre, has come out in support of Singapore Air's argument. Its founder, Graham Turner, said: "It's obvious that Qantas is the only serious player on the route. United is in bankruptcy. The capacity is a serious problem on the route."
Merge of two airlines