Time for a Reboot for the troubled Telco sector

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5/12/2017

MEDIA RELEASE:

Consumer rights in telecommunications, including mobile and broadband services, are so parlous that thousands of people are being left without access to essential services or meaningful redress when their suppliers fail them, according to consumer advocates.

A group of leading consumer advocates today pointed to staggering complaint levels, unfair sales tactics, and disappointing responses to customers experiencing financial difficulty as part of their call on the Federal Government to overhaul the regulatory framework governing telecommunications in Australia.

“Telecommunications are an essential service for all Australians, as much as other utilities like power and water,” said Gerard Brody, Chair of the Consumers’ Federation of Australia.

“Members of our community cannot pay bills, get important information, or remain socially connected without access to working telco services. Yet regulation of this vital industry is in the dark ages when it comes to establishing and enforcing the social obligations of service providers.”

The advocates said complaint figures were scandalous, with the Telecommunications Industry Ombudsman recording over 158,000 complaints in 2016/17. These complaint levels are much higher than in other utility sectors like energy or financial services.

“A few years ago the industry congratulated itself on ‘lower’ complaint numbers, but it is a mark of how out of touch it is with community standards that this so-called achievement still saw well over 100,000 complaints recorded by the TIO“, said Mr Brody.

To put this in context, Canada’s equivalent body to the TIO, the CCTS[i], recorded a peak of accepted complaints in 2012/13 of 13,692[ii], despite Canada’s population being 50% greater than Australia’s.

“Earlier this year, the Financial and Consumer Rights Council (FCRC) surveyed financial counsellors in Victoria and asked them to rate their experiences in resolving debt issues with telcos on behalf of customers in financial hardship. The telco scores were abysmal, and far worse than the energy retailers and banks,“ said FCRC Executive Officer, Sandy Ross.
These problems reflect a utility industry that has been left to regulate itself. The Telecommunications Consumer Protections Code now under review is controlled by the industry body, which pays lip service to consumer consultation. The groups said that telco regulation is out of step with consumer protections in other sectors like energy and financial services and it was time for the Federal Government to act.

“We are seeking to meet with the Minister for Communications, and the regulator, the Australian Communications and Media Authority to put the case for rebooting regulation of the industry, to protect consumer access to essential services”, said Erin Turner, Director Campaigns & Communications, CHOICE.
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For further information please contact:

Fiona Guthrie, Chief Executive Officer, FCA 

E: fiona.guthrie@financialcounsellingaustralia.org.au
Ph: 0402 426 835


[i] Commission for Complaints for Telecom-Television Services
[ii] https://www.ccts-cprst.ca/report/annual-report-2012-2013/. In 2015/16 this had fallen to 8,197. Note the CCTS publishes the numbers of complaints lodged against each of the individual telco companies in the reporting period. In Australia, industry has refused to agree to the TIO publishing the same information, but does publish TIO complaints in context (per 10,000 services in operation) for 5 providers, on a voluntary basis