NSW flags Virgin bail out if airline meets one condition
Cash-strapped Virgin Airlines could be given a multimillion-dollar lifeline from the NSW government - on the condition it moves its headquarters to Western Sydney.
Treasurer Dominic Perrottet revealed last night the government has had "significant discussions" with Virgin about providing financial assistance to the ailing airline.
Mr Perrottet said while no decisions have been finalised, the proposed Western Sydney move is "obviously part of the discussions that we're having at the moment".
Speaking to Sky News' Sharri Markson last night, Mr Perrottet said the NSW government had a "strong interest" in maintaining a competitive airline industry.
There are concerns that if the airline shuts down due to the COVID-19 crisis, a Qantas monopoly would result in airfare increases.
Asked whether he was considering offering Virgin a cash lifeline, Mr Perrottet said the government had "been in significant discussions over time with Virgin".
"We are still in discussions with them," he said.
Any major investment from the state government would be predicated on the basis that the airline, along with subsidiary Tiger, moved to the new aviation hub being built around Western Sydney airport.
"If Virgin were to consider being a tenant in the Aerotropolis in Western Sydney as that second airport comes online, that would be a very positive thing," Mr Perrottet told Markson.
"I raised that with Virgin over time. It's obviously part of the discussions that we're having at the moment."
The federal government has so far rebuffed Virgin's calls for a $1.4 billion bailout. Last week, Scott Morrison said he would not "get in the way of a commercial resolution to this".
But Mr Perrottet last night argued it would not be "uncommon" for government intervention because of the circumstances.
"It's not like you're propping up a company that's failed because of poor financial management.
"It has struggled due to the pandemic, and through issues outside of their control through government orders that have been put in place."
He said governments had a "much greater interest" in ensuring a competitive airline industry.
No decisions have yet been made, with the NSW Treasurer saying a proposal would need to go to cabinet.
"Any decision would need to be in the best interests of the taxpayers of our state," he said.
The move comes after Queensland offered Virgin a partial $200 million lifeline, on the condition it restructured its debt, continued regional flights and kept its headquarters in Brisbane.
Originally published as NSW flags Virgin bail out if airline meets one condition