Qantas flight refunds for coronavirus (COVID-19): ACCC raises concerns over cancellations

The ACCC says customers may have missed out on refunds they were entitled to. Credit: Paul Rovere

The consumer watchdog has raised concerns that Qantas encouraged some customers to cancel their bookings during the national COVID-19 lockdown and miss out on refunds they could have received if they waited for the airline to cancel them.

The Australian Competition and Consumer Commission (ACCC) said on Friday it had received hundreds of complaints from customers who were given "flight credits" rather than cash refunds from Qantas for flights grounded due to COVID-19 travel restrictions.

Following "weeks of pressure" from the ACCC, Qantas wrote to customers this week to "remind" them they had the option of a refund and has also made it easier for customers to use their flight vouchers.

"From our perspective, from the outset, Qantas did not communicate clearly with customers about their rights and, in a large number of cases, simply omitted they were entitled to a refund," ACCC chair Rod Sims said.

"I think that customers can and should expect better from Qantas, particularly when many of those customers may be out of work or experiencing financial hardship."

A Qantas spokesman said it did not think its communications were unclear to begin with.

"But we have written again to a group of customers in the window of time that the ACCC is concerned about to make sure they know what alternatives are available to them," he said.

The ACCC said it believed information Qantas sent to customers between March 17 and May 31 did not adequately inform them they were entitled to a refund for cancelled flights. In some cases, Qantas may have encouraged customers to cancel bookings in order to receive a flight credit when many would have been entitled to a refund.

Mr Sims said that even Qantas' most recent communications were not particularly clear and that any customers who were unhappy about receiving flight credits should contact Qantas and ask for a refund.

Virgin Australia is not paying any refunds after it went into voluntary administration in April, with a sale process for the airline now underway.

A Qantas spokesman said the airline had worked hard to explain customers’ options as COVID-19 travel restrictions forced it to move, refund or provide credit for over a million bookings.

"We hope the ACCC is not inferring that we haven’t done the right thing by our customers, particularly given the efforts we have made to manage an exceptional level of upheaval," he said.

The federal government on Friday said it had directed the ACCC to monitor prices, costs and profits in the domestic market aviation sector to police anti-competitive conduct.

Quarterly reports for the next three years will focus on whether airlines are dumping capacity on certain routes in a way that is damaging competition.

Mr Sims, who has previously said he would be watching Qantas’ behaviour carefully to ensure Virgin was not “killed at birth” as it emerged from administration under new owners, welcomed the direction.

Qantas’ budget arm Jetstar launched a large sale on Friday with airfares as low as $19 in an attempt to get Australians travelling again as state borders open up.

Qantas’ spokesman said the aviation sector was “extremely competitive and all indications are that it will remain that way”.

“What the ACCC can expect to find through its monitoring in the near term is Qantas and Jetstar flying its domestic aircraft to generate cash rather than leaving them on the ground costing money,” he said.