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Major airlines have argued against “pay-on-delay” legislation in a Senate committee hearing.
Representatives from Qantas Group and Virgin Australia appeared before the Rural and Regional Affairs and Transport Legislation Committee on Monday, with both airlines saying that EU and Canada-style customer compensation schemes increase airfares and do not lead to better outcomes.
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Markus Svensson, chief executive of Qantas Domestic, said costs were being passed on to consumers, and that the European scheme has created a side industry of “ambulance chasers” who are paid to make compensation claims.
“I lived three years in Europe, and I experienced this scheme as a consumer, and I have no good to say about it, and I now also know from all the studies that they’ve done, it increases the cost and it hasn’t improved in terms of cancellations and delays,” Svensson said.
“Airlines, and this goes for all airlines, have the incentive to operate, to schedule on time and with no cancellations.
“Nobody wants to cancel a flight. We don’t. It’s not good for the customer, it’s not good for operations. You can ask the Virgin team. You can ask any of the other airlines … there’s absolutely no incentive for us to cancel flights.”
Stephen Beckett, Virgin Australia’s general manager of government affairs, told the committee that EU airlines have, to date, paid out around $9 billion in customer compensation.
“We’ve seen at the same time almost a doubling in the number of cancellations. The types of performance that you’re looking to improve are not connected to what is paid and what’s not paid,” he said.
Both airlines indicated that they support the government’s plan to set up an independent aviation industry ombudsman to replace the industry-run Airline Consumer Advocate, which has been widely derided as toothless.
The draft of the government’s aviation customer rights charter, released in December, includes provisions for refunds if a flight is delayed by more than three hours, and comes after the Aviation White Paper in August promised to introduce a charter alongside the industry ombuds scheme.
The draft charter has seen mixed reviews, with consumer advocacy group Choice having said it did not go far enough, while the Regional Aviation Association of Australia (RAAA) said smaller regional carriers should see exemptions.
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says:There is quite a large and vocal group of travellers/commentators who are convinced that “Delays” should not happen and if they do, someone has to pay. Unfortunately for those folk they forget the rest of us are in the real world and we know differently. Believe me, the day when some airline chappie or missie says there will be no delays aint gonna happen!!, that is the nature of the business so please just accept it and move on. Sure, if the delay is more than the mentioned 3 hours on a single sector journey, I am certain that the carrier will offer a refund or a credit, you choose remembering of course, with whom did you buy your ticket? and that is another problem. These days, travellers have to realise that delays will occur and if your planned journey is time sensitive then, maybe you should take an earlier flight even if you have to choose an earlier day!!! E.G. You are travelling on the Ghan ex Darwin say on Wed. you are booked on the last flight to Darwin on Tues. (understandable but stupid) that flight is cancelled for whatever reason, you are gonna miss the Ghan!!!! and that will be another week gone. Think about it!
Now if you really want to get stirred up, have a good look at those “Non refundable” fares from both airlines and agents. To me, this is just not on, theft in disguise and it should be banned.