TNAG-0779-FCO40-983-Involvement-of-Hong-Kong-in-air-services-agreements-1978 — Page 108

services to points on the UK-Australia route with the end-to-end

UK-Australia services. The Australians see no place in their

revised arrangements for regular whole plane charters of the type

proposed by Laker but are prepared to review this position in

1981.

4 In practice, the proposals would mean a reduction in flights

between Australia from Europe from 43 to 16 per week each way

but an estimated increase of one-way passenger journeys of 75-100,000

in the first year to a total of about 600,000.

5

The Australians accept that the implications of their proposals

for third countries en route to London, particularly the SE Asian

countries, will face them with severe political problems. However,

the Australian Cabinet regard the internal political pressures for

lower fares as being of over-riding importance.

6

They examined the other low fare options:

(i) The introduction of a single coupon end to end

- fare at a lower level than existing fares without

disturbing other aspects of their air service

arrangements.

(ii) The introduction of whole plane charters of the

Laker type.

They rejected (i) on the grounds that it would bring with it

political odium and that without reduction of the capacity of the

present sixth freedom operators neither BA nor Qantas would be

able to attain sufficiently high levels of aircraft utilisation

to make a fare at an acceptably low level viable. They rejected (ii)

on the grounds that this would enable the charters to cream off the

low fare traffic thus increasing the problems of the scheduled

carriers in maintaining a reasonable level of all-the-year round on

2