By Business editor Peter Ryan
The future of Qantas will be high on the agenda when
federal Cabinet meets later today.
Today's deliberations will be the first of many after
last week's announcement that five thousand Qantas staff will be sacked as the
airline seeks to save two billion dollars over three years.
Qantas has been lobbying the federal government for
months to provide a standby debt guarantee or to change the Qantas Sale Act
which restricts foreign ownership to 49 percent.
However, Prime Minister Tony Abbott last week dashed the airline's hope of a debt guarantee last
week saying that if the commonwealth made it available to one company it would
have to offer it to everyone.
Instead, Mr Abbott is expected to focus on the Qantas
Sale Act which he has described as "a ball and chain" which restricts
the airline’s ability to attract foreign investors.
Coalition hardliners, such as the Nationals leader
Warren Truss, are sceptical of the Qantas claims and are reluctant to
immediately support moves to overhaul the current foreign ownership
restrictions.
Any move to change to Qantas Sale Act will be blocked
by the Senate and last week Mr Abbott called on Labor to provide bipartisan
support.
Qantas maintains the current limits put it at a
disadvantage to its chief rival Virgin Australia which has been able to able to
raise capital from three state own airlines, Air New Zealand, Ethihad and Singapore
Airlines.
Qantas has rejected a compromise proposal to maintain the 49 percent foreign limit while easing
single ownership limits within the cap to manage fears that Qantas could fall
out of majority Australian ownership.
A spokesman told the ABC this morning: "you
either level the playing field or not. Just tilting it doesn't fix
anything".
Meanwhile, The Greens and independent senator Nick
Xenophon will ask for any inquiry into the future of Qantas when parliament
resumes today.
However, without Labor support the move is likely to
fail.
Qantas has also refused to rule out the option of
taking Virgin Australia to court over claims its has manipulated foreign
ownership rules.
Last week, Qantas and Virgin revealed after tax
profit losses of $235 million and $84 million as a discounting war on domestic
routes damages both airlines.