MacTel warns telcos to fix problems before Royal Commission happens

The government delayed its review of telco consumer safeguards until NBN complaints to the TIO tripled, Labor has said, but Macquarie Telecom is suggesting tighter regulations aren't the answer.
Written by Corinne Reichert, Contributor

Macquarie Telecom has welcomed news of rising consumer complaints statistics to the Ombudsman because it "reveals that the practices being used within the telecoms industry to date are not working".

According to Macquarie Telecom group executive Luke Clifton, generic industry-wide regulations and consumer protection rules have not helped the banking industry, as shown by the Financial Services Royal Commission.

Clifton said responsibility should instead be put back on how each company will take steps to lower consumer complaints, before a telco Royal Commission ends up being called.

"Collective punishment through sweeping rule and regulation changes is not the answer now -- it has never worked in other industries," Clifton argued.

"Forcing those who are the worst offenders to fix their own problems, and then holding their feet to the fire, is the only short-term solution, and potentially the beginning of solving the deep issues of the industry before it faces its own Royal Commission."

Communications Minister Mitch Fifield had earlier on Tuesday announced the review of telco consumer safeguards, noting that "the existing model for complaints handling and redress is not working".

"We can't just blame the NBN for that," Macquarie Telecom added. "Ombudsman Judi Jones herself this morning on television said that she is more concerned with the three quarters of complaints not related to the NBN."

The announcement followed the Telecommunications Industry Ombudsman (TIO) revealing that consumer complaints about the National Broadband Network (NBN) rose by 204 percent year on year to 22,827 for the first half of the year.

In total, the TIO received 84,914 complaints about all telecommunications services during the six months to December 31, up 28.7 percent year on year.

"Like banking, it is the more competitive 'challenger businesses' in the telecoms industry which are bucking the trend and setting the bar with better customer service. These are the companies that make it their business to understand and care about their customers and organise themselves to deliver great service because that is how they grow," Clifton added.

"The heavyweights in telco aren't trying to grow their already-dominant customer base because between them the top three have close to 90 percent of the market."

Following the announcement, Shadow Communications Minister Michelle Rowland had criticised the Australian government for delaying a review of the telecommunications consumer safeguards until complaints skyrocketed.

"On the same day it was revealed that NBN complaints to the TIO surged by 204 percent, the Turnbull government has scrambled to announce a review of the same consumer safeguards it promised to review back in 2016," Rowland said.

The shadow minister pointed towards references of such a review in now-Prime Minister Malcolm Turnbull's communications deregulation roadmap from April 2014; the government's response to the Regional Telecommunications Review in February 2016; and the government's August 2016 submission to the Universal Service Obligation review.

According to Rowland, failing to act on these for years shows the government is only interested in the NBN "spin cycle".

"This comes on the back of the government sitting on the ACCC's proposal to set up a speed monitoring program for 14 months," she added, referring to the Australian Competition and Consumer Commission (ACCC) program to ensure retailers are delivering the NBN speeds consumers are paying for.

Like Labor, Communications Alliance pointed out that the telecommunications Consumer Safeguards Review had been flagged originally in 2016, having not been updated to take into account technological advancements or the NBN rollout.

"We are not satisfied with the high numbers of complaints that we are currently seeing, and industry recognises that more needs to be done to improve the overall customer experience," Comms Alliance director of Program Management Christiane Gillespie-Jones said.

"We need to ensure that any policy settings adopted now are effective in the long term while not creating unnecessary regulatory burden and costs for consumers after the rollout of the NBN has been completed."

Comms Alliance said it is also working with the Australian Communications and Media Authority (ACMA) on standards for complaints handling and NBN migration, as well as on the Telecommunications Consumer Protections (TCP) Code revision -- the latter of which is expected to be submitted to the ACMA for registration in spring.

According to the TIO's half-yearly report for 2017-18, most NBN complaints were about provider response, at 10,222 in total; poor service quality, at 9,006; connection/changing provider, at 8,929; no service, at 6,778; charges and fees, at 4,348; making a contract, at 490; infrastructure, at 337; in contract, at 250; equipment, at 247; and access or damage to property, at 207 complaints.

NBN pointed out that the 22,827 complaints were equivalent to just 0.67 percent of total services activated, and that it has been making efforts to reduce congestion by implementing new wholesale pricing and pausing its hybrid fibre-coaxial (HFC) network.

Rowland, however, said active NBN services grew by 105 percent during the half year, while complaints grew by 204 percent.

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