After nearly three years of COVID-induced travel disruptions, Yunzhou Li can finally embark on her study trip to Paris. But now she's got a problem.
"I was really glad to see that they now have flights to Paris next year," the Virgin Australia customer told the ABC.
"I went through the whole process. The final step didn't allow me to use the credit, which was really frustrating.
"These [credits] were from the cancellation for the Paris flight, why can't I use them for the same destination."
Ms Li's return trip from Melbourne to Paris was cancelled in early 2020 due to border closures.
She said she was eventually given a credit note of $2,300 – which expires in January — despite months of negotiation for a cash refund with the airline.
Ms Li said the redemption policy and the terms and conditions were "confusing" on Virgin's website, so she decided to ring up the customer service, spending hours on the line.
A Virgin customer service representative told her that credits issued before Virgin went into voluntary administration in April 2020, which are called future flight credits, are not allowed to book international long-haul flights, she said.
Virgin only flies some short-haul international routes and most of its long-haul routes are operated by partner airlines.
"Really hard to find information, we don't understand those law terms," Ms Li lamented.
"For consumers, we only need to understand which flights we can book and which flights we cannot, and why.
"I'm mostly likely to lose that $2,300 credit, because there's no way that I can use it at this stage."
Travel credits should be regulated as gift vouchers, Choice says
Travel plans disrupted by the pandemic have left hundreds of thousands of Australians with billions of dollars of flight credits.
But issues around flight credit schemes, including incomprehensible terms and conditions and inability to transfer to family members, have been criticised by consumer law experts, advocacy groups and the public.
Qantas and Jetstar currently hold $1.3 billion worth of unclaimed flight credits in their systems. So far, $1 billion worth of credits have been redeemed from the group.
Virgin did not disclose the value of its outstanding flight credits to the ABC.
A national report by consumer advocacy group Choice found many Australian travellers have problems redeeming their flight credits.
According to the report, more than one in five people (21 per cent) had been unable to use their vouchers after their flights were cancelled due to COVID.
One in four people had flight vouchers expire before they could use them.
"Airlines actually tightened up the credit policies earlier this year and late last year to make it even more difficult for people," Choice travel expert Jodi Bird told the ABC.
"Choice thinks that travel credits really should be regulated in a similar fashion to gift vouchers.
"They should be transferable to other family members. And, in circumstances where people just can't use the travel credit anymore, they should be transferable to a refund."
Virgin has now announced that it is extending the validity of its future flight credits from the end of January 2023 till the end of December 2023, in line with rivals Qantas and Jetstar.
However, Virgin's standard credits are still valid for 12 months from the date of issue.
Jetstar has extended its credit vouchers for one more year and the majority of Qantas' flight credits expire by December 2023.
Although the extension of flight credits would bring much needed relief for consumers such as Ms Li, many passengers have already lost money on flight credits.
'I would take them to court'
Hervey Bay resident Mike Harding is one of them.
The retired veteran lost $1,100 in unused flight credits due to border closures last year. He and his wife, Laura, have lost more money on flight credits since speaking to the ABC in April.
In May, the couple's return trip from Hervey Bay to Brisbane was cancelled due to severe weather. They paid $770 in both flight credits and with credit card.
Instead of opting for the 4-hour shuttle bus to Brisbane from the airport, the couple chose flight credits as compensation and went home, but those credits never landed.
"We've not heard anything about that since, not a word," the Qantas customer told the ABC.
"I'm sick and tired of people having their hand in my pocket.
Mr Harding said he later called Qantas customer service, twice, to chase it up, but he was told they were not able to locate his wife's transaction in the system.
"The frustrating thing is you just don't get the opportunity to use it and then they're expired," he said.
"And the two [credits] that we did have for this year, we've lost them. So it's pretty disappointing.
"If I had the money, I would take them to court, because I just don't know how to resolve this situation."
Mr Harding added that he was disappointed at Qantas' "abysmal" customer service.
The ABC put Mr Harding's case to Qantas for comment. A spokesperson said "we apologise that Ms Harding's flight was not correctly put into credit" and the airline would reach out to the couple to help them locate their credits.
Qantas also said it was working on initiatives to encourage customers to use their flight credits, including directly communicating with customers to remind them to use them and some other measures to help customers to redeem their credit.
Little recourse for consumers
Mr Harding also submitted a complaint to Qantas regarding his situation but said he did not receive any response, while Ms Li complained to consumer watchdog the Australian Competition and Consumer Commission (ACCC).
However, consumer advocates say there is little recourse for consumers caught up in those situations.
"A lot of consumers are struggling to get what they paid for out of the airlines," Mr Bird said.
"At the moment, the main recourse really is to go back to the airline.
"They use the airline customer advocate, but this really acts more as a forwarding service where, if you have a problem with the airline, you go to the customer advocate, and often they just refer you back to the airline."
Even if a consumer made a complaint to those regulators, the ACCC does not deal with individual cases while state and territory consumer affairs bodies are overloaded with complaints and the processing time is long.
The ACCC admitted that Australian Consumer Law offered limited protection to people seeking remedies due to COVID-related cancellations.
"When an airline cancels a flight for reasons within their control, the consumer guarantees under the Australian Consumer Law will apply," a spokesperson told the ABC.
"However, the consumer guarantee provisions of the Australian Consumer Law are unlikely to apply to cancellations of flights caused by government travel restrictions implemented in response to COVID-19.
"In this situation, consumers' entitlement to a remedy will generally be determined by the terms and conditions of their booking."
Earlier this year, the ACCC confirmed with the ABC that it was investigating the difficulties consumers were facing using Qantas flight credits.
As the investigation is ongoing, the spokesperson said the ACCC could not comment further.
Calls for industry ombudsman, mandatory information standard
The previous government had promised to conduct a review of the effectiveness of the Australian Consumer Law late last year, in response to the consumer issues caused by the pandemic.
A spokesperson for the current assistant treasurer told the ABC that the federal government was "currently considering these matters and will have more to say in future".
"The Australian Consumer Law in how it related to travel problems in the last few years has really let people down," Mr Bird said.
"So, it can definitely be improved to help Australian consumers going forward in in the travel space."
Choice wants a dedicated industry ombudsman to replace the airline-funded aviation consumer advocate.
"We only have a few Australian domestic airlines and obviously they're very concentrated," Mr Bird said.
"They're not used to being called to account for how they treat their customers.
"That's where something like an independent industry ombudsman would really help to make sure that airlines are being called to account when they let people down."
The consumer group also calls for a mandatory information standard used by all travel providers that has simple and consistent language.
For example, a clear explanation of how customers can seek refunds and other remedies, how long they will take, and how they can lodge a complaint if they're not satisfied.
The NSW government previously said it was considering such a standard.
Watch the story on ABC's The Business tonight at 8:45pm AEDT on ABC News Channel, or stream on ABC iview.
