QANTAS & VIRGIN AUSTRALIA: Backflip on aviation ombudsman

Australia’s two major airline groups, Qantas and Virgin Australia have long opposed any form of compulsory independent complaints procedure. Let alone a passenger bill of rights. Faced with a government green paper that suggested both for customer complaints to the airline industry, both airlines have backflipped.

Aviating whitepaper

The ‘green’ or discussion paper was released in September 2023 by federal Transport Minister Catherine King. It suggested that a passenger bill of rights to cover compensation for late and cancelled flights. And an independent ombudsman with strong powers to oversee customer complaints about the sector should be established.

A ‘white’ paper, developed after consultation on the ‘green’ paper is the step before government legislation goes to parliament. The ‘white ‘ paper is scheduled for release in mid-2024.

“This will include consideration of how we can better protect the interests of consumers, whether that be a stronger ombudsman model or other measures implemented in overseas jurisdictions.”.

The Hon Catherine King MP, Minister for Infrastructure, Transport, Regional development and Local Governement

What Qantas has done and said

Virgin and Qantas have both received a lot of criticism for their performance on all sorts of customer metrics, from baggage handling to delayed and cancelled flights. They have admitted and agreed to a massive AU$120 million fine and compensation deal with the Australian Consumer and Competition Commission after selling already-canceled flights to thousands of customers until this year, 2024.

In its response to the green paper in December 2023, Qantas was highly critical of attempts to introduce more independent customer protections, insisting that ‘enhancements’ to the totally inadequate industry-run and funded Airline Customer Aviation Advocate scheme would do the trick.

The Qantas Group believes that making permanent changes to the industry in light of a temporary and unprecedented set of circumstances (namely, post-COVID service failures) risks a range of unintended consequences.

Qantas Group responds to Aviation Green Paper

And it thinks the idea of European (EU261) or United Kingdom (UK261) style compensation for delays and cancellations is totally beyond the pale:

The proposal to introduce a mandatory compensation scheme doesn’t address the core drivers of delays and cancellations (which already represent a significant cost to airlines) and is likely to lead to higher fares and make marginal routes less sustainable. A similar scheme in place in Europe hasn’t led to a reduction in disruptions, with recent on-time-performance below Australia’s

Qantas Group responds to Aviation Green Paper

As of this morning, Qantas is changing its tune. No longer meeting the ombudsman suggestion with outright opposition it is now saying according to the SMH:

“Any aviation industry ombudsman needs to be carefully considered to ensure it resulted in timely resolution of consumer complaints and should cover the entire ecosystem including airports, travel agents and other service providers,”

Qantas spokesperson

While asserting that its main contribution to improved customer would be ‘the best thing we can do for our customers is to ensure more of our flights take off on time’. ‘No shit Sherlock!’ I think would be the most appropriate antipodean response.

What does Virgin Australia think

Sounds like they have found the same songbook as a spokesperson said that they “welcomed opportunities to improve the effectiveness of the external complaint-handling process for airline customers”.

And:

“We will work constructively with government if it is thought that improvements beyond those we have already supported are necessary. We will be keen to ensure unnecessary additional costs are not baked into the system.”

Virgin Australia spokesperson

2PAXfly Takeout

Call me cynical; I’ve answered to worse. But this sounds to me like the reverse of an ambit claim. It sounds like both Virgin and Qantas have worked out the public mood, which is all for substantial customer protections like the ones in Europe and the UK and even slated for the USA.

They have seen the writing on the wall and want to limit the damage. It would be much better to approve an independent ombudsman than to capitulate to a regulatory framework that would oblige them to pay compensation.

Remember that Qantas said in its initial response to the green paper that this would just increase the cost of airfares? Need I say any more?