Monique Ryan (Kooyong, Independent) Share this | Hansard source

Recently I upset a few people by referring to the aviation industry in Australia as the mafia of the skies. I do have to apologise for any upset caused to the mafia, who, after all, operate according to a strict code of conduct called the omerta, which is enforced and respected—in contrast to our airlines. Australia's special circumstance as a large, sparsely populated continent makes our aviation sector critical to our ability to connect people; to support our businesses and our health, education and tourism sectors; and to secure our supply chains. The current effective duopoly held by Australia's two largest airlines in both the domestic and international markets has created a situation in which our national and personal interests are vulnerable to their aggressively commercial practices and profit oriented decisions.

In recent years we've been subjected to a shutdown by Qantas in an industrial dispute which left passengers stranded, to the withholding of thousands of refunds through design and poor service responses, and to the hollowing out of skilled, experienced and much-loved workforces, which has resulted in delayed flights and poor service. More recently we've experienced the sale of tickets for cancelled flights and the hoarding of airport slots with phantom flights, in order to prevent further competition. Disabled travellers have described being forced to crawl to their seats, being refused disembarkation at their destination and being left with broken wheelchairs. Loyalty programs have been devalued. Points can't be redeemed, or they can be used to travel only in one direction. And they're now so devalued that the points which would have got you a first-class return ticket to London in 1996 will now buy you a coffee machine.

Currently, Australian consumer law does not require airlines to guarantee the timeliness of their services or even that they will run. Consumers are required to seek compensation for losses through airlines' complaint mechanisms. Less than half of Australians who seek a refund for a cancelled flight receive it within a month; one-fifth wait more than six months. Other nations, like the UK, US, Canada and the EU, have a clear set of customer protections which specify appropriate means of communication, assistance and compensation when passengers are disadvantaged by circumstances that are within the airlines' responsibility and control.

In Europe, passengers whose flights arrive at their final destination with a delay of more than three hours receive a reimbursement of between 250 and 600 euros, depending on the length of the trip. Longer delays mean that passengers can opt for a full refund to be paid within seven days. The compensation rules do not apply in situations where extraordinary circumstances, such as poor weather, cause the delay. This form of regulation results in more on-time arrivals and reduced delays. Its effect has been shown to be greatest on routes with little competition and those for legacy carriers. This shows that regulated consumer rights can improve service quality when incentives for competition are weak. This model would also provide an active disincentive for slot hoarding.

Peak bodies and the Australian Competition and Consumer Commission all support the need for airline-specific consumer protection. This should include the establishment of an independent travel and tourism industry ombudsman scheme. It should include standards of communication requirements for airlines to inform passengers in a timely fashion about delays and cancellations. That should occur both before departure but also while the passengers are on board. It should mandate proper heating and cooling of aircraft stuck on the tarmac and should enforce standards of care for disabled passengers. It must require airlines to pay compensation for passengers if they have delayed or cancelled flights, with clear rules and time frames around those refunds. It should include minimum requirements for travel credits. These rules would essentially create a passenger bill of rights in Australia. Australians deserve better from our airlines. It's past time that they stopped taking us for the very worst kind of ride.

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