TIO Annual Report 2003/04

Ombudsman's Overview cont.....

There will always be debates about the fundamental role of the TIO, but often opposition to changes to the TIO’s core function disguises an unwillingness to confront and accept the need for evolutionary development. Similar concerns have been voiced about the degree to which the TIO should become more proactive in resolving complaints.

The Australian Communications Industry Forum’s (ACIF) Consumer Codes are one of the most important underpinnings of the co-regulatory consumer protection regime for the telecommunications industry. Codes have been criticised by consumers and industry for being too complex and prescriptive and for taking too long to develop.

There are also concerns about the coverage given by individual Codes to particular issues and whether some are unduly narrow, leading to calls for a single overarching Code. From the TIO’s perspective, however, the key problems are the low sign-up rate and issues of compliance and enforcement. Just over half of all Consumer Code breach investigations by the TIO in the past year involved non-signatories. This suggests a lack of support for Consumer Codes by the very industry that has developed them. After seven years of work this is a poor result.

Equally troubling is the relatively low rate of Code enforcement, whether in the sense of compliance activity by ACIF or formal regulatory intervention by the regulator. For instance, there is clear evidence of widespread systemic non-compliance with the Complaint Handling Code. There is a major challenge and opportunity for ACIF’s Compliance Mark and for the Forum to demonstrate its credentials as a broadranging industry association.

In the policy area, the TIO has built on past progress with the continued development over the last twelve months of a variety of Position Statements dealing with unlimited credit, hardship and unfair contract terms, reflecting the impact of these issues on consumers.

We have also moved to broaden the reach of the TIO’s Systemic Complaint Investigation Procedure (SCIP), asking Council to approve new procedures. These matters are discussed in more detail later in this Report. Operationally, a significant trend of 2003/04 was the substantial increase in complaints, as a prediction of a modest increase of 2% turned into a surge of almost 8%.

As noted in past Annual Reports, the primary driver of demand for the TIO’s investigative services is the level of industry activity. This is followed closely by public awareness of the TIO and its role. While movements in levels of public awareness are usually gradual, changes in industry activity can be more volatile, making predictions of demand difficult.

For much of the year, TIO investigators were able to keep pace with the rising level of demand, with the call answering performance, escalation rate and average case resolution times all holding steady. More recently, however, the rate of increase in complaints has affected the TIO’s performance, most notably in the call answering benchmark, where service levels have declined for the first time in two years. This trend reflects the fact that a year ago the average call level was 2,000 per week, whereas now it is 2,500 per week.

In addition, at 30 June 2004, the TIO had a substantial backlog of cases awaiting investigation. These problems were exacerbated by an unusually high level of staff turnover in the last quarter of the financial year.

Recruitment and training of skilled staff have become a priority for the rest of 2004 as we attempt to return to past performance standards. The importance of this issue will not be lost on TIO Members who themselves have been criticised by the TIO for poor customer service levels. For the rest of 2004/05, we will ask the TIO Council to review current performance benchmarks with the intention of raising standards for the acknowledgement, actioning and resolution of complaints. This, of course, may have flow-on consequences for TIO Members.

Finally, at the end of a hectic year, I thank TIO Council Members and Board Directors for their continued support for the operations of the office, while grappling with difficult policy and funding issues and achieving a consensus in nearly all instances. Special thanks, however, are due to TIO staff who maintained their commitment and professionalism in the face of increasing demand and new consumer protection issues.

John Pinnock
Ombudsman

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