Xenophon ridicules Qantas claims of risk

Independent senator Nick Xenophon has labelled as "ridiculous" suggestions by Qantas that paying domestic wages to overseas-based crew could put its Darwin and Cairns operations at risk.

Qantas boss Alan Joyce and his counterpart at the low-cost offshoot Jetstar, Bruce Buchanan, have told a Senate inquiry their airlines "must adapt or die".

A Senate committee is examining legislation proposed by Senator Xenophon that would require Australian airlines to provide overseas-based flight and cabin crew the same pay and conditions as their Australian counterparts.

It is also looking at another bill that would ensure Qantas and Jetstar were based primarily in Australia.

Mr Joyce described Senator Xenophon's legislation as "misguided".

"We have grave fears for the future of Qantas if these legislative proposals come into effect," he said on Monday.

The Qantas boss defended paying foreign crew less than Australian crew when the two worked on the same flight.

It was standard practice adopted by airlines all over the world, he said.

"Strangling our international business and forcing us to pay uncompetitive wages ... is no way to make us stronger, better or more Australian."

Mr Buchanan said the changes would put Darwin and then Cairns operations at risk.

Jetstar uses "tag flights" from other Australian cities to Darwin to support its international flights out of the northern capital.

If cabin costs increased, the company would have to reduce its services through the airport.

"You double that cost base and that will put us so far under water that we'd have to pull about half the Darwin flights," Mr Buchanan told senators.

"That would have a serious impact not only on Darwin but on Cairns and on all of the tourism industries that rely on those services to feed passengers into Darwin."

Senator Xenophon was dismissive of the airlines' arguments.

"Suggesting that flights will be cancelled because cabin crew will be paid at the local rate is ridiculous," he said in a statement.

The difference it would make to the operating costs of an aircraft was minuscule, he said.

"Is Qantas really saying that, in order to survive in Australia, it has to rely on cheap overseas crews?

"If that's the case, then the Fair Work Ombudsman has a lot more to look at."

The Aviation Tourism Export Council backed Qantas in its opposition to the legislation.

Managing director Felicia Mariani said if the changes drove Qantas into the ground, many tourism businesses would follow.

"Qantas provides a critical link not only across Australia, but in connecting us to the burgeoning markets of Asia," she said in a statement.

"There is much more to be considered here than wages paid to Qantas' international cabin crew."