Neither Virgin OR Qantas should be given any more government assistance IMHO. Why should government prop up shareholders?
If Qantas is the last one standing, then so be it. If they price gouge, then by virtue of their margins they invite competition. Government can assist here by guaranteeing gates, slots tax concessions etc. They can also threaten / allow or even assist with cabotage. This was done post AN collapse with the likes of United operating Sydney - Melbourne. Qantas are terrified of cabotage, especially on the international front.
There are times when a monopoly is actually good. Government can regulate to protect consumers and the economy.
If Qantas fails, it will not be the end of the world. Again, foreign carriers can be asked to step up (US Airlines?) at least until such time as a new local airline emerges. No airline is too important to fail. In fact, the list of prominent failures is long.
Ansett’s collapse demonstrated, Australia’s second carrier simply does not feature. In fact, there will be some in Government and opposition actively pushing for a VA collapse. In AN’s case it was the Transport minister and the Prime Ministers Chief of Staff.