Media Release

8 January 2003
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Consumer complaints about the credit management and debt recovery practices of telephone and Internet service providers are on the increase, according to the latest statistics released by the Telecommunications Industry Ombudsman.

Ombudsman, John Pinnock, said complaints about the debt recovery and assorted credit management practices of telecommunications companies, including credit reporting, service barring and disconnection, had been increasing steadily since the beginning of 2002.

"This is a worrying trend and could be due to any number of factors," Mr Pinnock said.

"It may be that the increasing number of products and services on offer is making it harder for consumers to monitor their spending as they used to, or it could be a sign that telecommunications companies are becoming more aggressive in pursuing outstanding debts."

Mr Pinnock said the TIO had authority to investigate complaints about the credit management practices of telecommunications companies, and it could assist consumers to negotiate fair and reasonable payment arrangements, but it could not seek to influence or alter a company's business or commercial practices.

In the December quarter the TIO received 1,313 credit control complaints, with close to half of these relating to debt recovery, compared with a total of 1,101 complaints in the March quarter, 1,181 in the June quarter and 1,297 in the September quarter.

"The TIO is interested primarily in ensuring that the practices of providers and their agents is legal and proper and that the customer is treated fairly and reasonably at all times," Mr Pinnock said.

"The TIO's jurisdiction in this respect extends, by agreement with the telecommunications industry, to debt recovery agencies acting on behalf of TIO members, and to debt recovery agencies to whom debt has been sold."

Mr Pinnock said he expected the March 2003 quarter to show a further increase in credit control complaints, as the post-Christmas credit card account and assorted holiday expenses placed undue stresses on household budgets.

"Credit control complaints are traditionally higher in the first quarter of the financial year.

"It's always a good idea to keep track of your telephone account, or arrange to make regular payments throughout the billing period.

"My advice to anyone who thinks they may have trouble paying a bill by its due date is to contact their provider immediately to discuss alternative payment arrangements."

Background:

The TIO scheme provides an independent and informal forum for the resolution of complaints by consumers against telecommunications companies and ISPs. There is no charge to consumers to have a complaint investigated by the TIO.

All telecommunications companies and Internet service providers are required, under the Telecommunications Act, to be members of the TIO scheme. There is no fee to join the scheme, but companies are invoiced by the TIO each quarter according to the number of complaints made against them. Each company receives four free first level complaints each quarter. If a company does not receive more than four complaints against it for the quarter, it will not be charged a fee by the TIO.

Enquiries:

M = Mobile, L= Landline, I = Internet

Some practical suggestions on how to manage an awkward financial situation

If you don't think you'll be able to pay your account on time, call your company straight away and discuss it with them. Don't wait for the due date to arrive. If you address the problem before the account becomes due you will be in a better position to negotiate a fair and reasonable payment arrangement.

Ask your company for payment options, such as an extension of time to pay or a negotiated payment plan. Make sure you understand what is expected of you under the revised arrangements. Keep notes of who you spoke to and when and details of the agreement reached, including payment amounts and due dates. Inquire as to the consequences for you if you do not honour the agreement.

Ask your company for advice on avoiding these problems in the future. For example, you could request monthly, instead of quarterly billing so you can keep track of your bills. Alternatively, you may want to ask about pre-paid services, service barring or call control facilities, or arrange to make regular payments to your account as soon as you receive your wages, salary or benefits.

Some telephone companies are willing to suspend a mobile phone contract for a set period, if for example you have lost your job, or you are in hospital, overseas or in prison for an extended period. Make sure you ask whether any fees are attached to this service.

Contact a financial counsellor if your financial situation is becoming unmanageable. A community financial counsellor can give you free advice on how to deal with financial hardship and may also assist you to negotiate a payment plan with your telephone or Internet company.

If your company has barred or disconnected your service and you don't think they have a valid reason for doing so, contact them immediately and ask to speak to a senior customer service representative. If you don't have any luck, the TIO may be able to assist.

For further media information, please contact Public Affairs on 03 8600 8738 or 0403 601 532.

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