9 July 2023

Telco industry standards to be tightened to better support customers experiencing financial hardship

| Andrew McLaughlin
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The government has asked ACMA to enforce higher standards to support telco customers experiencing financial hardship. Photo: File.

The Federal Government has announced it will tighten enforceable industry standards for telecommunications companies so that customers experiencing financial hardship can be better supported.

Minister for Communications Michelle Rowland says she will direct the Australian Communications and Media Authority (ACMA) to make an enforceable industry standard to ensure appropriate support and safeguards are provided to telco customers struggling with cost of living pressures.

A 6 July release said the decision “reflects that priority by elevating financial hardship obligations to direct and enforceable regulation, which will deliver better outcomes for consumers more quickly”.

“Telecommunications are an essential part of life,” Minister Rowland said. “Given the current cost of living pressures that many Australians are facing, it’s important we have clear and enforceable rules so telcos give appropriate support to consumers doing it tough.”

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The move comes after ACMA released a report in May entitled Financial hardship in the telco sector: Keeping the customer connected. The report sourced its data from telecommunications providers as well as from independent surveys conducted by Roy Morgan and OmniPoll.

It found that not only are the rates of telco financial hardship significant, but also that only a small proportion of these customers receive any kind of hardship support. It said about 25 per cent of Australians have experienced payment difficulty or concerns about paying their essential services bills in the previous 12 months, and that 48 per cent of those had difficulty with their telco bills.

But of these, only a small fraction – less than 4400 people in total – were on a hardship payment program.

The ACMA report also found that, while industry is required to inform customers that hardship arrangements are available, about 40 per cent of customers were unaware that they can request assistance from their telco.

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Chaired by Ms Nerida O’Loughlin, ACMA is an independent Commonwealth statutory authority that regulates communications and media services in Australia.

The ministerial release said ACMA’s findings aligned with those from the Telecommunications Industry Ombudsman (TIO), the Australian Competition and Consumer Commission (ACCC), and consumer groups such as the Australian Communications Consumer Action Network (ACCAN) and Consumer Action Law Centre.

“That’s why I have directed the ACMA to ensure the appropriate safeguards are in place, and I will continue to take a close look at the consumer safeguards framework to ensure it is fit for purpose,” Ms Rowland said.

To this end, ACMA has produced a position paper, which outlines necessary improvements to the Telecommunications Consumer Protection (TCP) Code that is scheduled to be completed in 2024, and related industry practices.

“I welcome the position paper published today by the ACMA,” she added. “I also thank the ACMA for its work in preparing for the TCP Code review and I thank Communications Alliance for its efforts in leading the process.

“If a consumer is experiencing financial hardship and needs help with their telco bill, they should contact their service provider to discuss what arrangements are available. If a consumer is unable to come to a satisfactory arrangement directly with their provider, they should then contact the Telecommunications Industry Ombudsman (TIO) for assistance.”

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