Making a statement about independence is a smart move by politicians who see votes in their image credentials.
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But for Qantas and Virgin, these lounges serve a larger purpose.
For them, these rarefied lounges are the ultimate loyalty scheme for their corporate customers, and they made a lot of business marketing sense.
Despite what people may think, the Qantas chief executive and chairman don’t sit down over a glass of wine at the end of the year and hand pick Chairman’s club members.
About 90 per cent of members are picked by companies who are corporate clients. Each of Qantas’ business clients is allocated a number of Chairman’s Lounge memberships, based on their annual spending with the airline.
Let’s take Woolworths. Hypothetically, it may have a $2 million yearly airline budget with Qantas and be given three Chairman’s Lounge memberships. And it would be Woolworths that decides who from within its organisation gets the perk.
Qantas’ exclusive Chairman’s Lounge (pictured at Brisbane Airport).
Big corporate accounts are very lucrative for airlines, so for Qantas offering perks to senior corporate executives is a sensible investment, even though operating these elite lounges is expensive.
(Readers may remember that when Virgin was bought out of administration its strategy was to abandon its Chairman’s lounge equivalent, Beyond. But its desire to retain corporate clients ultimately resulted in the decision to reinstate the invitation-only exclusive club.)
So what about the 10 per cent of members who don’t earn their spot through a corporate account or usage?
Some of these people are just VIPs or celebrities that Qantas has presumably decided to grace the Chairman’s Lounge with because they are ornamental and the corporate customers appreciate rubbing shoulders with them.
Let’s say Kylie Minogue, Sarah Snook or Cate Blanchett. No harm there.
The decades-long practice of inviting all politicians into the Chairman’s Lounge clearly makes sense for Qantas. Sure, they have a touch of celebrity status, but they also have outsized influence, particularly over the highly regulated aviation industry.
But for the politicians accepting the largesse, it does raise the problem of conflict.
Would the public be concerned if the health minister got given a higher level of private health insurance? Should any minister (state or federal) be given a free pass for toll roads?
So it is completely understandable that a movement is gaining traction for politicians to waive their membership of airline lounges. If this means they need to sit in McDonald’s and savour a McCafé blend while they wait for boarding, then so be it.
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