Virgin cancelled Elif’s flight, then refused to refund her out-of-pocket expenses

Pressure is mounting on the Albanese government to bolster consumer protections for airline passengers, as federal independent MPs echo calls for an aviation ombudsman and better compensation for flight delays and cancellations.

Victorian independent MP Monique Ryan said airlines cared more about profits than consumer protections “and it’s time the government steps in”.

The Albanese government faces mounting pressure to bolster consumer protections for airline passengers ahead of the release of its aviation white paper.Credit: James Alcock

She said she was waiting for clear answers about how the Albanese government plans to protect passengers from “the poor corporate behaviour of the aviation sector”.

“When you buy a flight, you buy a flight at a specific time – not one a day later,” she said. “It is part of the airlines’ business model to make it extremely challenging for passengers to seek compensation. That has to stop.”

Tasmanian independent MP Andrew Wilkie said Australia lagged behind other countries when it came to securing compensation from airlines.

He said air passengers were often forced to raise problems with regulators or pursue legal action “which is time-consuming, sometimes costly and often beyond people”.

Transport Minister Catherine King said “the aviation sector is not delivering the outcomes that Australians expect”.Credit: Alex Ellinghausen

Transport Minister Catherine King said the aviation white paper, due for release later this year, would include consideration of how better to protect consumers “whether that be a stronger ombudsman model or other measures implemented in overseas jurisdictions”.

“It’s clear that the aviation sector is not delivering the outcomes that Australians expect,” she said.

The Australian Competition and Consumer Commission wants an independent airline ombudsman with the ability to make binding decisions to replace the Airline Customer Advocate, as well as a targeted and fit-for-purpose compensation scheme for delayed or cancelled flights.

“The ACCC considers the consumer protection framework in the airline sector needs improvement,” a spokeswoman said.

Elif Tuna has unsuccessfully sought a full refund from Virgin Australia for out-of-pocket expenses incurred when her flight was cancelled.Credit: Janie Barrett

When Virgin Australia cancelled Elif Tuna’s flight from Adelaide to Sydney last year, the airline assured her it would fly her home as soon as possible.

However, the “best available flight” would not land in Sydney until more than a day later after flying via Melbourne.

Tuna was annoyed by the hours spent waiting at Adelaide Airport for a rescheduled flight and to find out which hotel she would have to stay in.

But it was Virgin’s refusal to pay for all of her out-of-pocket expenses totalling $170.33 that angered her.

“If you are inconveniencing someone not because of inclement weather or some mechanical failure but because of poor management, just apologise and take care of them,” she said.

Virgin initially offered $87.77, including $50 for meals. Tuna told the airline in an email in January that she found it “beyond outrageous and hard to believe that your guests should be forced to incur financial losses due to your poor management”.

In response, a Virgin guest relations co-ordinator expressed sorrow “for the continued disappointment” and offered Tuna an additional $50.

Passengers on a delayed flight may be refunded reasonable meal costs, which Virgin’s guest compensation policy defines as “up to $30 per night per person if you are not at your home port”.

A Virgin Australia spokesman did not answer this masthead’s questions, but said the airline’s guest compensation policy set out what customers are entitled to when flights are disrupted, including other flight options, a credit or refund for the value of the booking, and how they can make claims for reasonable costs incurred in connection with the disruption.

Tuna said the policy was “misguided and behind the times”. “Since when has anyone had a meal under $30 in Australia anywhere post-COVID?” she said.

Ryan wants stronger consumer laws – similar to those in other developed countries – that compensate air travellers for delayed or cancelled flights.

“Under those laws, the passengers in this instance would have automatically received hundreds more dollars in compensation,” she said. “They wouldn’t have had to fight tooth and nail for a fair deal.”

Beefed-up consumer protection would also act as a powerful incentive to airlines to reduce cancellations and delays, Ryan said.

“Airlines would be much less likely to cancel or delay flights if they have to pay tens of thousands of dollars in compensation per flight.”

The poorly regarded Airline Customer Advocate reported a 102 per cent increase in eligible complaints from airline customers in 2022 – the latest year for which data is available – with fewer than half of the 1286 complaints resolved.

Data from the Bureau of Infrastructure and Transport Research Economics shows more than a quarter of flights operated by Australian airlines were delayed and 4 per cent were cancelled in February 2024.

Consumers’ Federation of Australia chairman Gerard Brody said there was an urgent need to bring consumer protections for Australian air passengers into the 21st century.

“Airlines hold significant market power, and it’s vital that airlines are required to treat their customers fairly, including providing full and complete compensation should there be out-of-pocket costs associated with flight delays and cancellations,” he said.

The federation has joined other consumer groups in calling for Australian laws to mirror the more stringent consumer protections in the European Union where delayed passengers may be entitled to up to €600 ($990) as well as other compensation.

“It’s pretty poor customer service to not fully refund the passenger, particularly when she is providing receipts and Virgin admits that compensation is owed,” Brody said.

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