The Productivity Commission has challenged Qantas's view that relaxing the rules governing air routes to Australia will encourage more Australians to fly overseas instead of enticing foreigners to holiday here.
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And in a sign of the federal government's willingness to lift limits on foreign airlines flying here, Trade Minister Andrew Robb welcomed the commission's research report on the international tourism industry, noting that about 3 million additional seats will be required on routes to Australia every year by 2020 – the equivalent of 120 more A380s each week.
In the research paper, the commission said giving airlines greater access to fly to Australia's four major airports – Sydney, Melbourne, Brisbane and Perth – would "provide net benefits" to the tourism industry and Australia.
"It is difficult to see how restricting access to secondary airports serving the major gateways, such as Avalon and the proposed airport at Badgerys Creek [in western Sydney], creates benefits for the Australian community," the commission said.
"If any restrictions are to remain, the case for all restrictions, except those at Sydney Kingsford Smith Airport, is quite weak, and open access could be extended accordingly."
Qantas had said in a submission to the commission that the government's policy of permitting capacity on international routes to increase ahead of demand had cost the national economy.
"Capacity gifted for the express purpose of promoting inbound travel was instead shifted into Australia's outbound market as inbound growth failed to materialise," the airline said.
"The rapid growth in the outbound market has resulted in jobs and investment being exported to competitor offshore destinations … ultimately to the detriment of both the tourism sector and Australian airlines."
But the commission rebutted Qantas's argument and pointed out that the aim of air-services deals should be to boost Australia as a whole "rather than to protect or promote any particular industry or commercial interests".
The commission said it "does not share" the flag carrier's view. "An imbalance between outbound and inbound tourism does not represent a net cost to the Australian community," the paper said.
While pointing out that Australia's aviation policy settings work well, the commission said the best way to achieve benefits for the country was likely to come from further liberalisation of bilateral air rights.
The report noted that existing air-rights deals prevented airlines from a number of countries including Malaysia, Qatar and the Chinese territory of Hong Kong from increasing flights here.
The Abbott government has shown itself to be a supporter of reducing the barriers to airlines increasing services to Australia.
In the past month, it has opened the way for Chinese airlines to almost triple their flights here over the next three years, as well as a doubling of capacity between Australia and Chile.
Mr Robb noted the commission's report underscored the importance of further liberalising air-services agreements to remove constraints in key markets.
The government will hold talks about likely relaxation of air-rights agreements with Qatar, Malaysia and Indonesia later this year.
Qatar Airways has been eager to increase the number of its flights to Australia – and begin services to Sydney – but it is prevented from boosting capacity under the existing air-services agreement.
Gulf carrier Etihad has also made clear it wants a loosening of the rules governing air routes between Australia and the United Arab Emirates as it nears the cap on the number of flights it can operate here.
Australian airports have mounted an aggressive lobbying campaign for a further opening of the doors to foreign airlines on routes to Australia.
Sydney Airport had said delays to increasing capacity on routes from China, Malaysia, Hong Kong, Qatar and the Philippines were curbing growth in foreign visitors.
The release of the commission's report comes as Qantas delivered better-than-expected earnings for the first half as a it benefited from its cost-cutting strategy, an end to a capacity war in the domestic market and cheaper fuel.
The performance of Qantas's international business was the standout from the result, swinging to a $59 million pre-tax profit from a $262 million loss.
The airline plans to boost second-half capacity by as much as 2 per cent. most of which will come from increased flying to international destinations such as Los Angeles, Santiago and Honolulu.
Qantas chief executive Alan Joyce said on Thursday that he would be "quite happy if all restrictions on all traffic rights were waived completely overnight because Qantas would do quite well in that".
"[But] people have tight restrictions on what can happen and where things can go, and as a consequence of that I think we have to be very careful on what rights and what justifcations we give to grant Australian rights to foreign carriers," he said.
He was responding to questions about long-running delays to Jetstar Hong Kong gaining regulatory approval to launch flights from the Chinese territory.