View Full Version : Branson barters money for jobs

11th Oct 2002, 00:15
The Courier Mail, Friday 11/10/02

Branson barters money for jobs
Matthew Franklin, state political editor
The airline Virgin Blue is set to create 350 new jobs in Queensland.

The expansion would be part of a plan to fly overseas from Australia and build an aircraft maintenance facility in Brisbane.

Virgin founder Sir Richard Branson confirmed in London yesterday that he was negotiating with the State Government to capitalise on Virgin's huge success since it established itself in its Brisbane headquarters in 2000.

"It's certainly gone beyond our dreams," Sir Richard told The Courier-Mail.

"In time, we will do international flights and hopefully some of those flights will be out of Queensland.

"We are also in talks about setting up our own maintenance operation in Queensland and that will employ a lot more people."

The aviation coup for Queensland continues the State Government's push to establish the state as an Australian aviation headquarters.

Premier Peter Beattie, in London for a trade mission, said the deal was close to being finalised and would definitely establish Queensland as Australia's centre for aircraft maintenance.

"Aviation in Australia is moving north and that means jobs," he said.

"Under the proposal being considered, Virgin Blue will also commit to locating its planned Boeing 737 pilot training facility at Brisbane airport as well as guaranteeing future Queensland staff levels at its Brisbane head office will grow by at least 200 over the six-year period.

"The capital expenditure involved in both the maintenance and training projects will total more than $50 million."

Mr Beattie also confirmed that taxpayers would underwrite the deal with an incentive package including payroll tax holidays, training support and a cash component to assist with the initial investment.

But Mr Beattie, often criticised by the State Opposition for handing taxpayer money to international corporate giants, refused to reveal the value of the package, saying it was commercial-in-confidence.

He said Virgin had already hired about 1300 Queenslanders since it established its headquarters in Brisbane in 2000 far exceeding job target commitments it made in return for incentives offered in its start-up deal.

"'Let's have honesty in this debate," Mr Beattie said.

"We have to realise that if we'd done nothing we'd have none of these facilities in Queensland and none of the jobs."

Sir Richard said the incentives were important because any international company looking at Australian operations thought of Sydney and Melbourne.

If governments in states such as Queensland did not offer incentives they would not win the business, he said.

"I was guilty of it as well when I was originally thinking of setting up down there," Sir Richard said.

Eventually, as Queensland grew as a business centre, it would not need to offer as many incentive packages.

Mr Beattie yesterday declared Sir Richard an honorary Queensland ambassador.

"He has helped put Queensland on the world aviation map and encouraged a level of competition in this country which we have not seen before in this sector," Mr Beattie said.

He also said his Government would spend $1 million on a tourism advertising blitz in the United Kingdom early next year.

A similar campaign run late last year had boosted tourism business from UK to Queensland by 21 per cent.

Going Boeing
11th Oct 2002, 03:18
Peter Beattie refuses to admit that his Tax payer funded incentives to Virgin Blue contributed to the demise of another Qld airline - Flight West. Every one knows that the regional airline industry suffered a major decline in traffic when Virgin Blue and Impulse started offering $33 fares to Sydney. Why pay top dollar to holiday in Longreach and other outback destinations when you can holiday in Sydney for much less.

11th Oct 2002, 03:39
Crikey - you are drawing a low bow there!!

Flight West was closed because the old man got the hump about his son being pushed out by CASA and others.

He simply took his bat and ball and went home!

VB did nothing to impact Flight West loads.

VB, if anything, helped - Jetcare is a Buchanan family business..

Don't forget folks that Bracks was willing to pay to have Tesna headquartered in Vic, Australian Airlines have incentives to set up in CNS, Motorola was "incentivised" to set up in SA - thats my new word for the week by the way - it is a common practice.

Landlords do it with commercial buildings - rent holidays, honeymoon periods etc.

Even retailers do it - interest free periods etc.

VB has done more good than harm since setting up in Brissie..

bitter balance
11th Oct 2002, 04:02
Lets not forget that Flight West was given much $$$ from the State Government to continue loss making operations and that competitors got 2/3 of stuff all.

If you are an existing Qld company just try to get a payroll tax exemption. Similarly, don't pay for 4 weeks and see what happens!!

14th Oct 2002, 02:44

Like your new word, if you can get a politician to pick it up and run with it you will be part of history

14th Oct 2002, 03:44
I think it would only be fair of VB to acknowledge the undisclosed

$$$millions poured in by Beattie, by employing "UNEMPLOYED"

Australians prior to EMPLOYED foreigners and expats. Especially

as those available here are usually more qualified, experienced

and possibly more suitable.

Are there any moral values in the aviation community?

IRONIC how employed 777 Cathay pilots are employed by VB

and yet there is a ban by Cathay on replacing them! The AFAP

supports the ban, but obviously not the big picture.

Going Boeing
15th Oct 2002, 00:56
DH Driver

I am aware of the squabbles that occured between CASA and the Buchanan family but all the evidence does indicate that Virgin & Impulse did take revenue away from the Regional operators during that period of unrealistic air fares - During that period, the QF regional operations (which previously and subsequently traded in the black) lost approx $65 million.

Jetcare was set up by Dennis to take on external maintenance contracts and to reduce his exposure wrt Flight West. The quality of workmanship from Jetcare was not up to an acceptable standard so in the last twelve months of its operation, Flight West sent a large number of components to other maintenance organisations in order to maintain aircraft serviceability. Virgin are also having problems with Jetcare which has resulted in DJ being unable to fly the most recently deliverd B737 - CASA blocked its operation based on insufficient numbers of ground engineers and inadequate maintenance systems. DJ and Jetcare have had discussions recently which has left DJ with no choice but to spend a lot of money setting up their own maintenance facility. This could have gone to Melbourne in the old AN hangar, but Peter Beattie has offered "incentives" for it to be based at BNE airport (or maybe even Maroochydore). As Jetcare has no other significant contracts, this leaves them in a vulnerable position.

I agree with your statement that DJ have done more good than harm since starting up in Brissie, but I wish that it had not been at the expence of Flight West and Ansett.