BILLS – Airline Passenger Protections (Pay on Delay) Bill 2024 – Second Reading

I rise to support the Airline Passenger Protections (Pay on Delay) Bill 2024 because it’s simply common sense. Australians should be protected and have consumer protections in place when their travel plans are disrupted, especially when those plans are disrupted by the large airline companies, who have significant market power in this country and have been exposed over the past few years as offering substandard customer experiences. This bill is very simple, and I applaud my colleague Senator Bridget McKenzie for bringing it forward. It simply makes sure that, if an Australian consumer has their flight cancelled, they are properly compensated. There should be minimum standards of treatment. It makes sure that, if you lose your baggage and it doesn’t turn up, you are compensated for that loss. I think most Australians would expect that to be the case, but it can sometimes be a costly and time-consuming procedure. It also makes sure that there is a cost associated with lengthy delays to the airline providers to make sure they’re not gaming the system in delaying flights or otherwise trying to maximise their profits instead of doing what they promised to do. These changes are necessary because our major airlines have not been responding to the legitimate customer complaints that we have seen, especially since flying resumed after the COVID pandemic. We have seen airlines state publicly that you don’t, apparently, really book a particular time and location when you book a flight these days. According to one airline executive, you just book a right to fly at some undefined point in the future. That is not what Australians expect; it’s not what they’re told when they go to book. There are particular times when a flight is meant to take off and particular times when it’s meant to land. Anything that the airlines think otherwise would be misleading and deceptive conduct in the extreme. The provisions that are in this bill that Senator Bridget McKenzie has brought forward are very similar to protections that are in place in major other countries, including in the US, in Canada and in European countries too.
It doesn’t seem to make any sense to me that the government wouldn’t be supporting these now. Who cares where the good ideas come from? Let’s just support them and get this stuff done. Let’s protect the Australian consumers and respond to this major issue. But, continuously over the past 18 months, this government have shown themselves to be running a protection racket for Qantas and the other major airline providers in this country. They have at every step of the way sought to defend the likes of Alan Joyce, the Qantas executive team and the other airlines, and they
have done absolutely nothing to rein in the market power position and the abuse of that position that our airline companies are taking. In response to the pandemic, the airlines all had to cancel a lot of flights, and that wasn’t their fault. That was obviously something that was imposed on them, but a lot of flights had to be cancelled. Our airlines were provided with billions of dollars of taxpayer money to compensate them for that unfortunate outcome, and they dragged their heels in providing proper refunds for Australian customers. In fact, I heard from some in the industry that it was an
explicit strategy of the Qantas CEO, Alan Joyce, to force people, to push people, into taking a credit for their cancelled COVID-19 flights rather than getting a refund. Apparently, Mr Joyce established two different call centre teams to deal with people that were seeking a change to or refund for their flights. If, on the automatic talking machine on your phone, you pushed the button that said ‘I want a credit’, you were sent through to a team that was very well staffed, had a lot of resources and would deal with your issue promptly. If you pushed the button that said ‘I want a refund’ because you actually wanted your money back for a service that wasn’t being provided, you got pushed through to a call centre that was massively understaffed and you’d be on the phone for hours. Apparently, Mr Joyce was boasting about this wonderful corporate strategy that he had invented to maximise the profits of Qantas and maximise the benefits of the taxpayer funding they had received, effectively defrauding Australian customers across the country. There has to be a response to this kind of corporate conduct. This is a very reasonable and sensible response to that, and it should be supported. Now, I also want to talk broadly here about the situation of airline policies in this country. Senator Sheldon apparently made the point—I wasn’t here for it, but I’ve been told that he made it—that the government can’t do this right now because they have to look at airline policy in the broad, and there’s a green and white paper process underway at the moment, so they need to wait for that. How long has this been going on? Some aspects of airline policy, going back to the former government, have now been waiting years for a response. The former government did have a pretty good excuse. Given what happened with COVID, it was pretty hard to make many major changes to airline policy while most of our country’s airline fleet was grounded. Flights weren’t in fact taking off, or at least not many, so it would’ve been inappropriate to make major changes to regulatory
settings at that time. But it’s been years now since the government received a report on the slots allocation policy at the Sydney airport. It is a major issue for our country. It’s a major bottleneck for our country, in that most flights leave from or terminate at Sydney, the busiest airport in the country, and the allocation of space for airplanes at the Sydney airport has huge ramifications and knock-on effects for other travel right across the country, including for those that aren’t travelling to or from Sydney, because it affects the whole network of planes across the country. Those slots, as they’re called—they’re parking spaces, basically, for planes as they arrive and depart—are allocated through a very complicated procedure which gives precedence, effectively, to the incumbent users of those slots or their historical allocation over time. Almost invariably the majority of those slots go to Qantas and Virgin, the incumbent providers. A few go to some regional operators and others, but mostly they go to Qantas and Virgin. Those slots remain with those incumbent providers, provided they use them for a certain percentage of the time. If they use them for a certain percentage of the time, they get to keep these slots. There is very credible evidence on this matter, which came to us during the cost-of-living inquiry and hearings, that especially Qantas, and possibly Virgin too, are effectively gaming the slot allocation system to make sure that they maintain their slots and that those slots are, therefore, not made available to potential competitors to their market position. Because of this issue, which has been a longstanding issue, the former minister for infrastructure,
Michael McCormack, commissioned a review into it. That review reported back, I think, in 2021 or something of that nature. It was years ago now. As I said, at the time it was inappropriate to respond to that review or make decisions because of the COVID situation, but now that’s long gone. We’ve been flying again now for a couple of years. We opened up two years ago almost to the day, and we’re still waiting on the now minister for infrastructure, Minister King, to respond to this major issue. The response, of course, could have a negative impact on Qantas but a positive impact for Australian consumers. If they are gaming the system and putting up unnecessary barriers to
competition, that is weakening the customer experience in the airline market and potentially making these cancelled flight issues a bigger, bigger deal. The way that Qantas could be gaming this situation is by booking these slots for a flight ahead of time and selling customers the seats and all these things. Then, just beforehand, they could cancel the flight for a variety of reasons and excuses that they can come up with. That would still give them that quota. It would still make them reach that threshold to keep that slot. But, of course, the customers who have their flight cancelled pay an enormous price. Even if they get their money back, there’s the cost of the disruption and their travel plans are cancelled, all so Qantas can maintain an incumbent position in the market.
The system should change. It has to change. Things are not working as intended. Yet this minister, Minister King, has been sitting on this report for the almost two years that she’s been the minister. There’s seemingly no action on this. As I said earlier, she seems to be running a protection racket for Qantas. She kept Qatar Airways out of this country with very little excuse or reason for it—sorry, there were lots of reasons and excuses; they just changed almost every day over a matter of months. There was no coherent explanation for why the minister refused to have more competition to Qantas in the international market, and now the minister seems to be protecting Qantas from
more competition in the domestic market as well. That is what’s leading to these poor customer outcomes, which are continuing to bedevil the market. Cancellations are continuing to be above their historical average. There are constant complaints of lost baggage and poor performance by the airlines. There clearly needs to be a response here to bring the airlines into line. And that’s what this bill does. This bill provides reasonable protections for consumers to make sure that they get proper outcomes when they’re flying around this country. I want to finish by stressing how important this is for people across Australia. Obviously we’re a very big landmass that is somewhat sparsely populated, especially between our major cities. That has meant that we don’t have, in this country, the same type of rail or timely road networks that other countries might have. It takes a long time to travel by road between our major centres, and we don’t have the fast rail type networks that you see in Europe or in North Asia. So, really, most people are left with the plane as the only option to travel long distances. A lot of people have to do this not just to go on a holiday but to receive medical treatment or to do business, and that is especially true for those of us who live in regional areas, where we have to travel to a major city to access a variety of services. Some of those services are life changing and life saving. People often have to travel to receive cancer treatment or other medical treatment on a regular basis. It’s for chronic treatment, not just in the case of an
emergency; sometimes people have to travel multiple times a year to manage their health issues.
Other people in the town where I am, in Rockhampton, have to travel for business. They have to go to places like Brisbane for major financial or legal services, which are simply not available in their local town. These services are essential for people’s livelihoods and peace of mind, and the frustration that has emerged in the past few years through the cancellations, through the excessive prices and through the lack of customer service when things go wrong has added a level of stress to those in very difficult circumstances—they might be in poor health—and a level of cost for those who are just trying to go about their business in this country. So it’s very important that we, as a nation, have efficient airline networks servicing our entire country and our sparse population. Those industries are not serving Australians well at this stage, and there clearly needs to be a response to make sure that we have efficient airline service right around this country. This government does seem to be doing something—running this protection racket, which I’ve mentioned—and then sometimes just seems to be completely asleep at the wheel. We haven’t heard from Minister King. I don’t know where she is. She has just completely disappeared off the face of the earth-Yes, she’s at the airline lounge, waiting for a flight, perhaps! We don’t know. Where has she been? As I said, she has got this major report on slot allocation in Sydney. We’ve heard no response from her. What the hell is going on? Now we have a government that’s seemingly not taking up these commonsense ideas, instead saying, ‘We’re doing more reviews,’ and it could be months and months before Australians receive any kind of relief or response. Why don’t we just get on with it and pass this bill? It’s very, very simple. It would make the minister actually do something. This bill doesn’t outline in detail what the requirements would be. I think that’s appropriate for an overriding piece of legislation. All the bill says is that the minister must, within 12 months, come up with some of these rules to protect Australian consumers. At the very least, passing this bill might actually make the minister for infrastructure do something. That would be good because she’d have to, within 12 months, do something for a change. Right now, it’s pretty hard to understand what the minister for infrastructure is doing apart from just running a protection racket for Qantas.