There’s more to Joe Aston’s book about Australia’s national carrier Qantas than access to a luxury airport lounge.

From 2011 to 2023, Joe Aston wrote the highly entertaining ‘Rear Window’ column for The Australian Financial Review, and delighted in exposing the hubris of the rich and powerful. In his final column he wrote he had had the ‘most riotous fun exposing the rampant spin over substance in Australian business and politics, and demonstrating just how thin that veneer is’. In The Chairman’s Lounge he describes himself as ‘a satirical columnist whose métier was dissecting the misguided beliefs of powerful people’.

During 2022, Aston became aware of mounting criticism of the services provided by Qantas and the belligerent stance of its CEO, Alan Joyce. He wrote a series of pieces criticising Qantas, which earned the ire of Joyce. Qantas twice made representations to the AFR’s editor Michael Stutchbury about Aston’s columns, and when Stutchbury did nothing, Qantas stopped providing copies of the AFR in its lounges. This exposed ‘Qantas to ridicule, with passenger provocateurs leaving copies … strewn around Qantas Clubs’. One member informed Aston that ‘staff kept a couple of copies for us hidden behind the front desk like they were porno magazines’.

His interest in Qantas piqued, Aston decided to embark on a more in-depth examination of the company. The Chairman’s Lounge focuses on the period from just prior to COVID to Joyce’s eventual exit in September 2023. Aston cites 2019 research that found Joyce was highly regarded within Australia, ‘identified … as Australia’s fourth most recognised businessperson … [and] stood alone as the nation’s singular celebrity CEO’. By 2023, he was ‘the most hated businessman in Australia … What happened in those four years is the focus of this book.’

Aston provides a forensic account of how Qantas operated in those four years, the various decisions it made and how it interacted with the business and political worlds. He combines this with an insightful understanding of the history of Qantas, the nature of the aviation industry (both in Australia and internationally), and the broader corporate and political scene in Australia. Aston’s major strengths are his keen eye for detail, his delight in unpacking the absurd, and his ability to follow loose threads and weave them back into the broader sweep of the narrative.

Aston describes the culture of Qantas management as one

… of high-handed exceptionalism; of unbelievably aggressive tactics in pursuit of its objectives, of a shared willingness to mislead or even lie, with little regard for the victims or for community expectations.

This culture manifested itself in the pursuit of short-term profits, which were linked to Qantas’s share price, and in turn linked to the bonuses Joyce and his management team were paid. At the beginning of COVID Qantas sought to reduce its costs and obtain subsidies from the government of $2.7 billion.

There were three major ways in which Qantas sought to reduce costs. The first was staff cuts. Despite receiving JobKeeper funds from the government designed to enable employers to retain staff so they would be available once things ‘returned to normal’, Qantas unlawfully dismissed 1700 baggage handlers. It lost three court cases over this action, including before the High Court.

Qantas also made many workers redundant, including engineers and pilots; created new companies to employ new staff on lower pay with fewer entitlements than existing employees; outsourced work – such as call centres – overseas, and employed overseas flying crews at lower rates of pay. Many of the staff lost had held positions that required a period of training. The more skilled the occupation – such as pilots and engineers – the longer the period of training.

Second, Qantas cut back on purchasing new aeroplanes and on investing in technology to enhance customers’ interactions with the company. Aston points out that under Joyce’s leadership, Qantas consistently put off buying new planes – a significant capital expense that would reduce the financial (cash) assets at Qantas’ disposal and reduce profits, with knock-on effects on the share price and the bonuses paid to management. Old planes require more maintenance and are more expensive, especially fuel-wise, than new ones. Qantas also mothballed planes during COVID and converted two from passenger to freight services.  

The problem was that when COVID came to an end and travel resumed, Qantas had neither the staff, the planes or the technology to meet demand. The result: difficulties making bookings, long delays to get online, delayed or cancelled flights, poor service on planes, luggage going missing, and substantial increases in prices. In some cases, fares increased by 45 per cent compared to pre-COVID levels; business class flights between Perth and Sydney cost as much as $5000.

The third way Qantas tried to protect its financial position was in its approach to flight credits. Because of COVID many people were forced to postpone flights. Virgin reimbursed its customers. Qantas did not. It told customers to hold on to their tickets and use them in the future. While under law it was required to provide reimbursements, it did not communicate this clearly to passengers. When flights resumed, passengers found it difficult to obtain flights, were required to pay extra for now more expensive flights, and were prevented from switching to cheaper flights. In the latter part of 2023 Qantas said passengers would lose their flight credits if they did not claim them by the end of that year.

Qantas also sold tickets for ‘ghost’ flights – flights that never happened. The ACCC subsequently indicated that it was going to commence legal action over this. Qantas agreed to pay $20 million to compensate customers and was fined $100 million. It also rescinded its decision that customers would lose their flight credits and agreed to reimburse customers if they so desired.

The Chairman’s Lounge opens in 2006 when Aston lands a job in the office of Federal MP Bruce Baird, the member for Cook, the seat later held by Scott Morrison. Aston says Baird

… was known – only half jokingly – as the member for Qantas. More Qantas employees lived in Cook than in any other electorate, and he advocated fiercely for their interests. He was chairman of the Coalition’s parliamentary Friends of Tourism, a lunch club of government MPs and senators who were wined, dined and lobbied intensely by airlines, airports, hotel groups, travel agents [and] cruise ships … Many of Baird’s party room colleagues treated him as a conduit to the airline and its largesse. MPs turned to him with their travel problems, like feudal lords petitioning the feudal court.

In one of his ‘Rear Window’ columns Aston revealed that Joyce had offered Prime Minister Anthony Albanese’s son Nathan membership of the Chairman’s Lounge. This was a source of controversy, especially in the context of the Albanese government having denied extra flights to Qatar airlines following the end of COVID. Seeing off this extra competition enabled Qantas to keep charging high prices. In December 2022 the Australian Bureau of Statistics reported domestic and international airfares were major contributors to inflation. It is conceivable that inflation and interest rates would have been lower, and flight services enhanced with lower fares, if Qatar had been allowed to increase its presence in Australia.

Aston provides interesting information on the operation of the Chairman’s Lounge. Membership is a privilege granted by Qantas’s CEO.

The Chairman’s Lounge is a speakeasy for Australia’s ruling class, yet it is so much more than that. Possessing its membership means passing the mystical velvet rope of high social status – something Western consumer culture conditions us all to strive for. It is confirmation that you’ve made it, entitling you quite literally to breathe different air to regular people. Of course, it is a classic chimera, because if you’d really made it, you’d be at the Excelsior terminal boarding your own Global Express.

Who gets invited?

They are board directors, CEOs and senior executives of Australia’s major companies – or any company which spent sufficient millions each year travelling Qantas. They are virtually every member of federal parliament, and state government ministers; they are secretaries and deputy secretaries of all Commonwealth (and many state) departments, and senior military officers. They are the chairs and CEOs of government agencies, including Qantas’ regulators: the corporate cop, ASIC, the competition cop, the ACCC; and even the safety regulator, the Civil Aviation Safety Authority. All judges of the Federal Court and the High Court are Chairman’s Lounge members, as are newspaper editors, certain commentators and breakfast television hosts, and an assortment of B-list celebrities. And in most cases, their spouses are also members. In 2023 there were around 5000 consecrated members of the Chairman’s Lounge – 9000 if you count their approved spouses.

Aston is also critical of the Qantas board, especially its chairman, Richard Goyder, in the stewardship of its relationship with Joyce. In the language of business-speak, Joyce had captured his board. Such reticence is not unique to Qantas.

There are precious few public company directors willing to pierce the cordiality of board proceedings with expedient truth. For most, the unspoken personal objective is continued membership of the professional directors’ club, the closest thing Australia offers to life peerage. And the Qantas board was its highest prize.

In 2023 Qantas directors received pay ranging from $210,000 to $256,000, with Goyder receiving $604,000 as chairman. In addition, every director, their spouse and their children under 26 are entitled to three long-haul (overseas) ‘highest class’ return trips and nine short-haul (local) ‘highest class’ trips each year. The chairman is entitled to four overseas and twelve local trips. After directors leave the board they and their eligible family members are entitled to one long-haul and three short-haul trips each year for every year they were a member of the board. For the chairman it is two long-haul and six short-haul trips. Aston calculates that the market value of the maximum travel entitlement for a Qantas director with a partner and two children would be more than $500,000.

The Chairman’s Lounge provides a masterful account of how a major corporation operates. It documents the ways in which Alan Joyce reduced the size of the Qantas workforce, its fleet of aeroplanes, the quality of its services, and trashed the Qantas brand in his never-ending quest to enhance Qantas’s profits and thereby its share price and his own income. Joe Aston’s major focus is on Alan Joyce’s fall from grace. While explaining how this occurred he also provides valuable insights into how Australia operates, especially the nature of power and the ruling class who wield it.

Joe Aston The Chairman’s Lounge: The inside story of how Qantas sold us out Scribner 2024 PB 352pp $36.99

Braham Dabscheck is a Senior Fellow at the Melbourne Law School at the University of Melbourne who writes on industrial relations, sport and other things.

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Tags: Alan Joyce, Anthony Albanese, Australian aviation policy, Australian Financial Review, Australian politics, Bruce Baird, Chairman's Lounge, Joe | Aston, political influence, Qantas