ACMA intervenes on telco complaints

Telcos with over 30,000 customers will be required to report complaint figures to the ACMA under draft guidelines set out by the telecommunications regulator today.

The Australian Communication and Media Authority's draft report on the "Reconnecting the Customer" inquiry called for a ban on ‘soft’ caps and an expansion of the role of the Telecommunications Industry Ombudsman.

It also called for telcos to distribute a single-page ‘critical information disclosure summary’ to new subscribers with specific information on products, alongside contact details for the ACMA.

Releasing the draft report, ACMA chairman Chris Chapman said the communications regulator was attempting to become more “front-footed” on regulating customer service issues.

He said the inquiry was part of ACMA’s attempt to build confidence and momentum in the telecommunications space, which had been overshadowed by the regulator's concern for radiocommunications, broadcasting and online content regulation.

“The report addresses the paradox that consumers are happy with their telecommunications services but are unhappy with their service provider,” he said. 

The report identifies six particular problem areas and specifies clear objectives:

• Improved advertising practices and disclosure of simple unit pricing;
• Improved product disclosure information before sale;
• Introduction of transparent customer care performance reporting;
• Provision of expenditure management tools;
• Adoption of best practice internal complaints resolution; and
• Changes to the TIO scheme including governance and systemic complaints processes.

Claire O’Reilly, project manager for the inquiry, said the draft report indicated a tougher stance on key issues within the telco industry. Under the recommendations, telcos would be prohibited from using “confusing” terms and would have substantiate any claims made under the service agreement.

Larger telcos would also be required to report the total number of complaints, the number of complaints compared to their total customer base, and the number of repeat complaints from a user within a 45-day period. O’Reilly said the recommendation would ensure telcos compete against one another on “timely contact resolution”.

“There is no transparency in industry about how different providers are performing,” she said. “There are good providers out there providing good service and we want to make sure that that can be seen.”

TIO unfazed

Telco ombudsman Simon Cohen said the report was consistent with his office's own experiences with customers.

"Telecommunications complaints are rarely resolved first time and, where undertakings are made to resolve complaints, they are often not followed through," he told iTnews in an email.

Despite ACMA's recommendation to demand direct reports from telcos of complaint numbers, a spokesperson for the ombudsman said any actions taken from the final report would be unlikely to change the TIO's role significantly.

Chance for industry

The industry is being given the opportunity to address these issues through a revised Telecommunications Consumer Protection Code, a copy of which was leaked to iTnews last month.

The ACMA has flagged that the existing draft code is insufficient and would only ratify a revised code if it met the principles outlined in the inquiry’s report.

“The ACMA was provided with a draft copy of the TCP Code about six weeks ago and has assessed it against the requirements in our draft report,” Chapman said. “Industry recognises the need to sharpen their pencils on their code.

“The report provides the essential base information for the ACMA to proceed to specifying a standard and no one should misunderstand that.”

Communications Alliance chief executive John Stanton welcomed the draft report from the ACMA inquiry and said the outlined recommendations were in line with the direction taken under the revised TCP Code.

“Some recommendations go further than envisaged by the current TCP Code draft, which already incorporates wide-ranging improvements to consumer protections and industry practices in areas such as product disclosure, complaint handling, advertising, code compliance and spend management tools,” he said.

The TCP Code steering group would re-examine the draft code in light of the report.

A final version of the inquiry’s report was expected by August.

“The die is cast, we’ve put it to industry,” Chapman said.  “The guidance has been provided; the invitation has been issued.”