Shadow Treasurer Chris Bowen Says Qantas Is Too Important To Fail

QantasPhoto: Getty (File)

Opposition Treasurer Chris Bowen has told Sky News that the government should consider making a direct equity injection into Qantas because the airline is “effectively” too important to fail.

“It’s a very important part of the Australian economy which every government, Labor or Liberal, would be concerned about and which would be constructive in their approach to ensure they’re a vibrant, viable company.

“A small stake would send a signal to the debt markets around the world and to financiers that this was a body with which the government had a keen interest.

“That is one of the options on the table which we would look at constructively,” he said reports The Australian.

Despite Bowen’s hint that a government stake could be possible for Qantas Prime Minister Tony Abbott has told the airline not to expect a handout, as it unfair in terms of the foreign ownership rules.

“Businesses have to operate profitably and in the end they have to operate profitably because of their own decisions and from their own resources,”said Abbott last week.

The airline, which had it’s credit rating downgraded to “junk” status on Friday by S&P following 1,000 jobs cuts and recording a half-year loss of up to $300 million, could see borrowing costs rise by up to $120 million.

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