Opposition warns of risks with Qantas ownership changes

THE Federal Opposition has warned of major risks to regional Qantas flights around the country if the Abbott government decides to remove foreign ownership restrictions on the national carrier.

Opposition Leader Bill Shorten made the comments on Monday, as the government prepared for a Cabinet meeting to decide what it would do to ensure Qantas's future.

While Mr Shorten and Labor's infrastructure spokesman Anthony Albanese said they were willing to negotiate with the government, both warned of impacts of changes to the Qantas Sale Act.

Prime Minister Tony Abbott has confirmed he plans to "unshackle" the airline from the act, which currently prevents majority foreign ownership of the company.

But he may be at odds with Treasurer Joe Hockey, who has signalled he was open to a government debt guarantee for the airline, an option Mr Abbott said would not be considered unless it was also offered to its domestic competitors.

While the Cabinet was yet to meet to discuss the airline's future, Mr Albanese said a removal of the ownership rules could see the airline broken up.

He warned the potential impacts of any break-up of the company would hit regional flyers hardest, as the company was currently obligated to maintain regional flights as part of it's role as national carrier.

While the government has not indicated whether it would allow such changes, Mr Abbott said the future of the airline would still be protected under two other mechanisms.

He said separate, legislated restrictions on airlines deemed Australian carriers, and the Foreign Investment Review Board's likely say on any foreign sale, would further protect the airline.

While Qantas has encouraged the government to consider a debt guarantee, Mr Abbott said his government was "not in the business of favouring one company over another".



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