ALP top brass feather nests,
Albanese pulls Taylor tango
By Anthony Klan | April 22, 2020
Key ALP figures, Virgin Australia workers and unions pose yesterday in push for a government bailout. Source: ALP
While the ALP ramps up its calls for the government to throw vastly more public money at the failed Virgin Australia, key front benchers are found to have failed to disclose tens of thousands of dollars of gifts from the foreign-owned airline. Virgin is throwing $1 million a year or more at politicians and public servants - who's looking after the taxpayers? Anthony Klan reports.
Shadow transport minister Catherine King and shadow assistant treasurer Stephen Jones have been forced to disclose tens of thousands of dollars worth of free memberships they received to the ultra exclusive, top-tier airport lounges run by Virgin Australia and Qantas.
As the ALP further ramps up its calls for taxpayer money to be used to bail out Virgin, which was swept into administration yesterday, we can reveal both King and Jones have updated parliamentary records to disclose having received the highly valuable "gifts", following an investigation by Michael West Media.
It also appears opposition leader Anthony Albanese has failed to disclose many years of complimentary memberships to Virgin's top-tier, secretive lounges, known as "The Club", as well as free memberships to its rival's equivalent, The Qantas Chairman's Lounge.
Last year was the first time Mr Albanese, who has been in federal parliament 24 years, and who was transport minister from 2007 until 2013, has disclosed receiving free memberships to the "invitation only" Virgin and Qantas lounges - and he has repeatedly refused to comment when asked whether he or his spouse had received the largess before 2019.
Earlier this month, Energy Minister Angus Taylor was forced to update the current Register for Members' Interests after Michael West Media revealed he had failed to disclose that he and his wife, barrister Louise Clegg, had received complimentary memberships to The Club and The Qantas Chairman's Lounge.
Taylor has been in federal parliament since 2013 but has refused to say how long, before the current parliament, that he and his wife had been receiving the highly valuable top-tier airline lounge membership "gifts", which one expert says are worth as much as $10,000 a year.
“Advice provided by the Clerk’s office was declarations do not need to be backdated to previous parliaments,” a spokesman for Taylor told us.
The case has exposed a little-known parliamentary loophole whereby MPs can avoid ever disclosing gifts they have received - regardless of their value - so long as they make it to the end of the current parliament, which is usually when a federal election is called.
It now appears Albanese is relying on that Taylor technicality to keep hidden thousands, if not tens of thousands, of dollars worth of “gifts” he has received from both Virgin Australia and Qantas, potentially over many years.
Albanese’s spokesman Matthew Franklin initially promised to get back to us regarding our questions, however he failed to do so and has not responded to repeated requests for comment since.
The lavish gifts from Virgin Australia accepted by ALP top brass over many years is particularly stark given Labor's aggressive calls for a taxpayer funded bailout for the airline, which the opposition doubled-down on yesterday after it collapsed amid debts of $5.3 billion.
In a joint statement yesterday, Albanese and King accused prime minister Scott Morrison of having a “piecemeal approach to aviation” and of doing “nothing to support the airline through this crisis”.
"Now that he has let the airline fall into administration, Scott Morrison must outline a plan to take an equity stake in Virgin and ensure we continue to have two major airlines in this country," the statement said.
The Federal Government has provided hundreds of millions of dollars of support to the airline industry since the coronavirus pandemic began, however it drew the line at bailing out Virgin Australia, in large part because it is 91 per cent foreign owned and those owners refused to provide any assistance.
Virgin Australia CEO Paul Scurrah and his predecessor John Borghetti have personally "gifted" memberships to Virgin Australia's ultra-exclusive The Club lounges to hundreds of federal MPs, their spouses, the chiefs of staff of federal MPs, to state premiers and to other state politicians.
One of the reasons analysts have given for Virgin Australia's failures is Borghetti's heavy push into the business class market and the airline's heavy spending on expensive lounges.
Virgin Australia's lavishing of gifts on the nation's politicians - which could be worth $1 million a year or more, even on conservative estimates - will likely be closely examined by any group seriously considering buying into the failed airline.
Those "gifts" also raise serious ethical and corporate governance questions.
It is illegal to bribe politicians - but it is also against the law for a public company to fail to act in the best interests of its shareholders.
Handing away expensive gifts for nothing in return is not acting in the best interests of shareholders.
Scurrah and Virgin Australia chairman Elizabeth Bryan have failed to make clear how this apparent serious contradiction can exist.
On April 6, after we contacted her office, King disclosed in the parliamentary Register of Members' Interests that she and her husband were were complimentary members of both Virgin’s “The Club” and its rival’s equivalent, the Qantas Chairman’s Lounge.
The disclosure states those memberships are a “continuation”, however it’s unclear when King and her spouse first began receiving the free lounge memberships.
King has been the federal member for Ballarat since 2001 and the April 6 notice is the first time she has declared receiving free memberships to the exclusive Virgin and Qantas lounges.
Jones declared having receiving a membership to the Virgin and Qantas lounges on April 3.
His office told us the failure had been an oversight and Jones had disclosed memberships in previous years but had failed to do so in the current parliament.
The register shows that in 2016, during the last parliament, Jones disclosed that he and his partner had each received memberships to the Qantas Chairman’s lounge, and Jones himself had received a Virgin membership.
MPs are required to disclose all "gifts" they receive that are worth more than $300, but despite the exclusive Virgin and Qantas memberships consistently being among the most expensive gifts lavished on politicians, reporting of the gifts is often piecemeal and sloppy.
Last year, in his first disclosure of the Virgin and Qantas lounge club gifts, Albanese failed to correctly list them in the "gifts" category of the disclosure document, instead listing them under "memberships".
The miscategorisation may be considered of limited importance, however it raises question marks because in several previous years, under the heading “memberships“, Albanese has simply written: “member of various clubs in the electorate” but has failed to name any of those clubs.
Virgin's The Lounge allows members to visit anytime they like with two guests - three guests if the member happens to be flying that day - and it provides limitless top-shelf alcohol and fine chef-prepared meals.
Members are also provided with free limousine rides and regular free air travel upgrades.
Australian Business Traveller editor David Flynn has estimated the top-tier lounge memberships are each worth as much as $10,000 a year.
Last year the Sydney Morning Herald reported that Virgin Australia provided free memberships to The Lounge to at least 341 MPs, their spouses and public servants.
Even if the memberships are worth as little as 0ne-third of Flynn's estimate, Virgin Australia is handing out over $1m a year in lavish gifts to politicians, their family members and other key public servants.
Governance experts have long warned that, at the very least, it's a bad look for politicians to be accepting the largess.
Those concerns have been greatly magnified given Virgin Australia is now pursuing many of the recipients of its largess for vast sums of taxpayer money.
That pursuit is aimed at keeping Virgin Australia alive in its current, or a similar, form - and so keeping big salaries flowing to Virgin Australia's executives.
King's updated pecuniary interest register. Source: Federal Parliament