Consumer watchdog logs huge rise in complaints calls about travel and accommodation sectors

Monday, 6 July 2020

Air NZ has come in for fierce criticism for not refunding passengers who wanted them, sometimes to the tune of thousands of dollars.

A huge ramp-up in consumer enquiries to the Ministry of Business, Innovation and Employment about accommodation and travel preceded the Covid-19 lockdown.

The ministry’s (MBIE)quarterly Consumer Protection Report data covering the first three months of the year shows a 150 per cent increase in complaints enquiries about the sectors, with the spike coming towards the end of the period.

“This quarter experienced some different enquiry patterns across sectors as a result of the increasing impact of Covid-19 towards the end of this quarter,” the report says.

“Accommodation or travel services enquiries experienced the largest increase (120 more enquiries, 150 per cent increase),” the report says.

* Coronavirus: Air NZ sitting on millions of dollars for cancelled flights, Consumer NZ says

* Coronavirus: Refund rows over holiday cancellations continue

In March, Air New Zealand introduced a new refunds policy, which caused uproar among travellers who wanted cash refunds for cancelled flights, as opposed to credits they could redeem against flights in the future.

Travellers were also finding out their travel insurance did not cover losses caused by pandemics.

A third of complaints enquiries about accommodation and travel services concerned “terms and conditions”, the ministry said.

Covid-19 impact on normal life also led to concerts and events being cancelled, as well as disrupting international postage and courier services, leading to big jumps in complaints enquiries about the two sectors.

People who bought tickets from Ticket Rocket have struggled to get refunds for cancelled events.

March saw events ticketing business Ticket Rocket run into trouble over refunds for cancelled events.

The spikes in complaints about travel, accommodation, events and postage resulted in an increase in complaints enquiries compared to the previous quarter, which included the busy Christmas period.

The report shows 11,889 consumer enquiries came in to the ministry’s call centre, up from 11,603 in the previous three-month period, but down from 13,492 in the three-months to September 30 last year.

The report gives consumers a snapshot of which areas of household commerce they need to be at their most wary.

Car sales remain the biggest topic of consumer complaint enquiries to MBIE.

The single largest portion of complaint enquiries was about motor vehicle sales, although it was also one of the easiest sectors to get compensation thanks to the Motor Vehicles Disputes Tribunal.

The bulk of those complaints enquiries were for vehicles that were faulty.

The second most enquired about purchase was that of electronics and mobile phones.

Many consumers don’t go to ministry when they feel ripped off, or uncertain of their rights, but instead head to a Citizens Advice Bureau (CAB).

In the first three months of the year, CAB received just over 8000 consumer enquiries, which was slightly down on the previous year.

Over half of enquiries were about motor vehicle sales, and consumer rights.

MBIE said the single biggest “category” of enquiry was potential breaches of the Consumer Guarantees Act, which required that goods or services be of acceptable quality and fit for purpose.

If a good or service is neither of these, a business must repair, refund, or replace it.

The Consumer Protection quarterly reports were compiled to provide it and the public with information on issues currently facing consumers, the ministry said.

The data was collected by CAB and the MBIE.

* An earlier version of this story incorrectly attributed the Consumer Protection report to the Commerce Commission.