Labor may cave-in on Qantas

Labor is prepared to cut a deal with the Government in its demands to lift foreign ownership restrictions on Qantas but will insist maintenance and catering stay in Australia.

Parliament yesterday partially cleared the way for Qantas to be sold to overseas interests, rushing the Qantas Sale Amendment Bill through the Lower House.

The Bill removes foreign ownership restrictions as well as stipulations the maintenance, catering and administration be headquartered in Australia.

If the Bill were to pass the Upper House, Qantas would have to split into domestic and international arms, with only the international arm still majority Australian-owned.

Lower House MPs voted 83-53 to support the Bill just four hours after it was introduced.

But Labor and the Greens have made clear they will not support the Bill in the Senate in its current form, warning if ownership restrictions were removed without protections thousands of Australian jobs would go overseas.

Despite Labor's objections, it is understood Opposition Leader Bill Shorten could consider passing the removal of ownership restrictions provided the Government amended the Bill to ensure maintenance, catering and other essential services were still carried out in Australia.

Currently, a single foreign investor is limited to holding a 25 per cent share in Qantas. Foreign airlines are limited to a combined total holding of 35 per cent.

After the sale repeal Act passed the Lower House, Mr Shorten questioned whether Qantas' world-renowned safety record could come under pressure should the airline be sold overseas.

But Prime Minister Tony Abbott warned Mr Shorten against making any suggestion that airlines with foreign-based maintenance were unsafe.

The union representing Qantas office workers says more than 1000 workers have been given only two weeks to consider a redundancy offer.

Qantas has said it will cut up to 5000 jobs over the next three years after posting a record loss.

Unions have also complained the airline is yet to clarify where jobs will be cut and workers are being traumatised by the uncertainty.

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