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Virgin Australia and Qantas are at loggerheads over frequent-flyer benefits for bureaucrats, with the Flying Kangaroo pushing back against Virgin lobbying to ban them.
While government travellers have been barred from accruing frequent-flyer points since 2010, they are still allowed to gain status credits from official travel, which Virgin Australia says should be dispensed with as it creates an uneven playing field between itself and Qantas.
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“Virgin Australia believes status-related benefits – such as lounge access or priority boarding – can easily be addressed through the booking code process,” a spokesperson told The Australian Financial Review.
“Virgin Australia supports the removal of status credits on Australian Public Service bookings – just as frequent flyer miles were removed in 2010 – to reduce any potential purchasing bias that such loyalty features might create in an environment where lowest practical fare policies apply.
“Stronger adherence to the Australian Public Service’s lowest practical fare policy will not only deliver significant additional savings for the taxpayer, but stimulate competition and deliver greater choice and value for tourists and residents wishing to travel to and from the ACT and neighbouring regions.”
Qantas, however, has countered by saying access to airline status benefits, including lounges, is saving the taxpayer money, with Qantas International chief executive Cam Wallace estimating direct cost savings to the government to be in the “tens of millions” annually.
“Frequent flyer members get additional benefits which reduce travel expenses and help them be more productive when they are travelling – things like lounge access, including space to work as well as meals and beverages, and additional baggage,” Wallace told the Financial Review.
Currently, around 3.3 per cent of Qantas bookings and 1.4 per cent of Virgin bookings are for government travel.
The Department of Finance’s Report of the Review of Australian Government Travel Policies found that the airlines have a fair split of official bookings, according roughly with the share for the general public, and did not recommend banning government travellers from claiming status credits.
“However, as part of the consultation process ahead of the next re-tender of the airline Panel, the issue of status credits suppression will be canvassed with the market, along with any perceived improvements as a result of the recommendations within this Review,” the report read.
“The Review heard anecdotal report of frequent travellers waiting until bonus status credit offers were made by airlines to book their upcoming trips. Airlines need to ensure promotional offers like these are not applied to official travel under any circumstances.
“In response to bonus status credit offers, Finance has proactively written to all domestic panellists during the review to remind them of their obligations under the Airline Deed to not offer bonus status credit offers to Government travellers.”
A Department of Finance spokesperson told Australian Aviation, “On 1 August 2025, the Department of Finance (Finance) released an Industry Consultation Paper via AusTender, seeking feedback from the airline and travel industry on topics to help inform the strategy for a new Airline panel arrangement.
“This Paper includes several topics for consideration, including fare offerings, airline benefits (including treatment of status credits), technology and systems.
“Finance will review feedback received to help inform the proposed upcoming approach to market.”
Fergus Moffat
says:I was in the state public service for 15 years post 2010. We had all business travel F/F points credited to our name, every trip. I’ve no doubt every senior govt member did too… unless they had the great misfortune to be aboard the BBJ.