Consumer advocate CHOICE has published the results from its travel cancellation survey which received 4,295 responses from January to March 2021. The purpose of the survey was to gather qualitative information about consumer experiences of travel cancellations due to COVID-19 and associated restrictions.
The diverse range of experiences canvassed in the Travel Cancellation Survey report was related to travel and tourism businesses located worldwide, but many related to businesses operating in Australia.
While the report provides a snapshot of the types of common issues raised by people in their responses, importantly, it also outlines policy recommendations aimed at getting Australians travelling again, with confidence that they have clear rights when something goes wrong.
In the survey, respondents talked about travel they had booked to be with children, parents and other loved ones separated by distance; to get married, attend weddings and celebrate important life milestones like birthdays and wedding anniversaries. Travel was seen as a significant life milestone that they had worked long and hard to afford for many.
So what were the findings and what can the industry learn? You can download the must-read 19-page report in full here.
Reform needed to restore consumer confidence in travel
Overall, CHOICE found that current consumer protections have let travellers down through the pandemic with the following problems from survey responses observed:
- Consumers are unaware of the options available to them, which led some to cancel arrangements in ways that then affected their ability to obtain a refund.
- Consumers find it hard to obtain information on their rights and receive a remedy. This is because of difficulty contacting providers, delays and complex agency arrangements that make it difficult to understand whether refunds were progressing.
- The rights and remedies available to consumers are variable and often unsatisfactory. These have been largely determined by the terms and conditions of each operator and/or travel agent, which are often difficult to understand. Outcomes have included: a. Consumers being out of pocket, for example, due to inability to obtain any refund or excessive cancellation fees; and b. Consumers receiving credits or vouchers that they are in reality unable to use.
- Consumers lack protection when companies become insolvent.
As such, CHOICE recommended the below steps to improve consumer confidence in booking travel.
1. Make it easier to get a refund when a service isn‘t provided
Fewer than one in five (17%) of the survey-takers got a full refund, and it often took many months. Nine out of 10 respondents said Australia’s laws should be changed to make it easier to get your money back.
One respondent said, “Was to go on an 18-day European tour/cruise on March 2020. We cancelled 2 days before we were due to leave Australia, as the coronavirus pandemic had really taken hold of Italy, and the cruise was cancelled. The travel company said we were not eligible for a refund as we cancelled.”
Governments should improve consumer protections for people who book travel or tourism services that cannot be provided due to circumstances outside the control of the business and consumer.
In doing so, governments should initially focus on businesses that are clearly bound by Australian law and should implement reforms that make it easier for consumers to receive refunds from service providers and travel agents obtain refunds from service providers on behalf of their customers.
2. Make travel credits and vouchers fairer
Many consumers who’ve received credits or vouchers say they’re unlikely to be able to use them.
Although more than one in four (27%) of survey respondents did get some of their money back, 25% were only offered a credit or voucher or just a voucher. Sometimes the partial refunds were very partial indeed, with travel providers keeping as much as half of the money customers had paid.
To make matters worse, many credit and voucher recipients were worried they won’t be able to travel again before the credit or voucher expires.
More than eight in 10 (86%) of the cancellations survey respondents reported were for flights, and many said that trying to get their airfare back has been a fruitless exercise. The next most cancelled service was accommodation, at 65%.
Choice found that people want governments to mandate minimum requirements for travel vouchers/credits provided by travel and tourism businesses in lieu of a service, similar to those that apply to gift cards.
3. Lift standards of customer service
The survey found that sorting out travel cancellations and refunds have often involved punishingly long waiting times on the phone and a wearying game of pass the buck: airlines, accommodation providers and other travel businesses tell customers to take it up with their travel agent or third-party booking site, who then send customers back to where they started.
“Went on for months using contact us box on a website and then received an email that you could not respond to. Shows the limitations of a cheap hotel booking website; no customer service when you need it,” Said one respondent.
In many cases, it wasn’t clear who had the money – the travel provider or the booking agent, and they often seemed to be battling it out between themselves, leaving customers in the dark.
The Federal Government should introduce a mandatory industry code applying to all airlines and large travel and tourism businesses taking money from Australian-based consumers. Small travel businesses should be given the option to sign on to the code.
4. Make it easier to get disputes heard and resolved
Over half of the people surveyed (53%) said they waited more than three months for a refund, credit or some other resolution.
The Federal Government should establish a new travel and tourism industry ombudsman, similar to the Telecommunications Industry Ombudsman or the Australian Financial Complaints Authority.
All airlines and large travel and tourism suppliers, large travel agents, and large intermediary companies should be required to participate in the industry ombudsman scheme. Smaller travel and tourism businesses should be able to opt-in to the scheme.
5. Improve information provided at the time of booking
The Federal Government should introduce a mandatory information standard for travel companies on the information that must be provided to consumers at the time they make a travel purchase.
This should include what refund a consumer will receive if a business cannot provide a service, information on how to complain, and travel agents and intermediaries, a breakdown of fees and commissions.
The current terms and conditions are confusing and not made a priority nor accessible to consumers.
6. Conduct an ACCC market study into the travel and tourism sector
CHOICE suggest that The ACCC should conduct a market study into the travel and tourism sector, focusing on travel agents and intermediaries. The market study should consider competition, independence, contracting practices, pricing transparency and risk allocation through the supply chain.
7. Establish a website for information on restrictions
Australian governments should establish a website that publishes information on domestic COVID-19-related restrictions to provide travel and tourism businesses and members of the public with timely, accurate and consistent information, including information on past restrictions that may have affected bookings.
So where to from here?
While there were some scathing comments aimed at the travel industry and travel advisors in the report, many people reported positive experiences, including:
- travel agents who went above and beyond in their efforts to obtain refunds for their customers;
- travel and tourism businesses that were proactive and regular in communicating with their customers; and
- travel and tourism businesses that gave refunds even though the terms and conditions of the booking didn’t technically require them to.
People who were lucky enough to have such positive experiences vowed to continue to book with such businesses into the future. “I usually book direct with airlines and accommodation. This time I used a travel service for airline bookings. This made it so much easier for the cancellation and refunds as she did it all. I cancelled accommodation with no problems.” said one respondent.
In addition, many people expressed sympathy and concern for the owners and employees of travel and tourism businesses – especially small businesses – who they could see were grappling with very challenging and unprecedented circumstances.
At the same time, however, other consumers’ negative and protracted experiences mean that they feel they can no longer trust some travel and tourism businesses with their money. Some have vowed never to use particular businesses again.
While the last 18 months have been a horrendously complex, challenging and unprecedented time, the need for urgent industry reform is loud and clear if CHOICE’s survey is anything to go by.
After reading their findings, it feels there is a degree of common sense that could easily be implemented to many of these points as solutions.
Challenges or opportunities? If the pandemic has taught us anything, it is that we all have a once in a lifetime chance to create a new way of working and reimagining what a more sustainable travel industry could look like.
The question is, will we seize the moment and make the change?
Got an opinion to share? We’d love to hear it. Email us at editor@karryon.com.au
