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More than 12% of the total complaints received by the Commerce Commission for the year to 30 June 2020 were related to travel, as the impact of Covid-19 saw a record number of grievances voiced against the industry.

According to the Commission’s Complaints Snapshot for 2019/20, travel was the most complained about industry, with 1225 complaints out of a total of 9892, or 12.4%, coming under the travel category, a new grouping for 2020.

“Travel-related complaints include those about airlines, booking agents, motor vehicle rentals and accommodation,” Commerce Commission chair Anna Rawlings said.

Airlines received 477 complaints, booking agents 386 complaints, accommodation 184 complaints, and motor vehicle rentals 178 complaints.

The total number of complaints received for the year was an increase of more than 10% on the 2018/19 figure of 8964. Of those, 20% were related to Covid-19.

“Not all of the travel complaints we received related to Covid-19, but the travel sector was strongly affected by the pandemic and that has caused a large increase in travel-related complaints,” Rawlings said.

Travel complaints covered themes including difficulty obtaining refunds, offers of credits rather than refunds for Covid-19-related cancellations, and new contract terms inserted in contracts, such terms providing for cancellation fees to be charged.

“We note that but for Covid-19, telecommunications retail service providers would have again been the most complained about industry,” Rawlings added.

The Commission said high levels of publicity about an industry or an issue could sometimes result in more complaints. Larger industries were likely to generate more complaints because they had more customers.

“We welcome information from consumers and businesses about conduct that they consider might breach competition or consumer laws,” Rawlings said.

“We do not investigate every complaint we receive, but every complaint helps us to understand what conduct is of greatest concern to consumers and businesses, and to identify where to focus our activity and resources to have the greatest impact.”

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The new package would support agencies to recover New Zealanders’ money locked up offshore due to cancelled travel plans because of Covid-19.

“I was part of the petitioning group that approached the Government on this so we are broadly happy with it,” O’Donnell told the Ticker.

“From an industry point of view, the problem is there is no income for many businesses now.”

Travel agencies would be paid 7.5% of the value of cash refunds, and 5% of the value of credits successfully secured on behalf of consumers.

If an agent recouped $10,000 in a cash refund on cancelled travel, the customer would get that money back and the agent would receive $750. If it was a credit for the $10,000 of cancelled travel, the customer would get the credit and the agent would receive $500.

“We want to help customers but companies like cruise shop operators, hoteliers and airlines need to be able to pay staff and rent and so on,” O’Donnell said.

“This scheme is taking us forward. It will offset some of those costs although not all.”

It was taking airlines and travel product suppliers a long time to deal with refunds and credits because their systems were not built for it.

“You book an airline ticket online and pay your money. It’s not really designed to work the other way,” O’Donnell said.

“The suppliers are getting quicker but it’s still up to them to provide the money. And customers often need to make choices about taking a refund or a credit that may be worth more than the cash refund.”

New Zealand Travel Industry Suppliers Group chairwoman Robyn Galloway said most of the companies in the industry were SMEs with a predominately female workforce.

“It is estimated that nearly $700m of New Zealanders’ money is currently locked up in bookings for international travel.

“Getting this money back into New Zealand will be an economic boon, as it can then be spent in the local economy. This is complicated work that relies on the expertise and relationships our travel companies have with multiple international partners.

“We have had to cut costs and make staff redundant over the past six months just to stay in business, and many travel companies are struggling and being forced to downsize, increasing the risk that Kiwi travellers’ money will be stranded overseas.”

But Galloway said the support would not be to sustain the industry in the long term.

The Travel Agents’ Association of New Zealand’s outgoing chief executive, Andrew Olsen, said the package gave a great message to customers.

“Not all details are hammered out yet but it’s great news,” he said.

“It’s been a long time in the making. It will help some more than others but it’s good recognition of the industry’s role with customers.”

Commerce and consumer affairs minister Kris Faafoi said travel agents and wholesalers had been working hard to recover refunds and credits owed to New Zealand consumers, but were under “severe financial pressure, with many facing the prospect of insolvency”.

“The travel reimbursement scheme will help increase the likelihood of consumers recovering refunds and credits owed to them,” Faafoi said.

“It will also give greater confidence to the travel industry by limiting further insolvencies.”

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Speaking to media Monday, Ardern said the Government was considering a draft text that was being worked on by officials that would become the basis of an agreement for travel between the two nations.

Ardern and the prime minister of the Cook Islands, Henry Puna, were close to agreeing the Arrangement to Facilitate Quarantine-Free Travel between the Cook Islands and New Zealand, which would represent the first phase of establishing a travel bubble.

Jacinda Ardern

“Whilst we haven’t put a timeframe around reopening at this stage, our expectation is that it would be in place before the end of the year,” Ardern said.

“With that draft text almost agreed, it means we now have agreement over who would be eligible and how it would operationally work, but now we just need to assure ourselves of the measures on the ground.

“The last thing anyone wants is to reopen travel only to have it closed down because it hasn’t been done properly.”

The next phase would see officials in both New Zealand and the Cook Islands undertake work on the ground to assure expectations were being met. That verification work would take place within the next 10 days and the integrity of the maritime and aviation borders would be a significant part of that.

Ardern said a potential bubble would mean quarantine would not be required but health checks and declarations at the border would be needed as part of an additional layer of assurance.

“The whole point of establishing this regime is the assurance that both the Cook Islands and New Zealand is considered to be Covid-free, but that doesn’t mean we won’t have extra stages of assurance.”

Anyone with a New Zealand passport would be eligible for entry into the Cook Islands, but beyond that would be a matter of meeting Cook Islands visa requirements.

“The percentage of New Zealanders that make up the tourism industry in Cook Islands is 60%. But of course in this environment, it’s very hard to assess the differences in people’s travel habits we might see as a result of Covid.”

Prime minister Puna said the elimination by New Zealand of community transmission of Covid-19 had enabled some travel from New Zealand since 19 June for Cook Islands residents who met health and border entry requirements.

“Since the 19 June, we’ve continued to strengthen our border and health capabilities including stress testing,” Puna said.

“That work combined with recent joint efforts between New Zealand and Cook Islands health and border officials through this arrangement assures me both Governments are giving this matter utmost priority and we will be able to commence quarantine free travel between ourselves as soon as it can be safely achieved.”

Ardern added that New Zealand was waiting on Niue to be ready for a travel bubble but arrangements for a trans-Tasman bubble were “some time off”.

However, the trans-Tasman bubble arrangements that the Government was working to created a framework that could be used for other countries albeit quarantine free travel with other countries was not a reality at this stage.

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In a much-awaited announcement, Ardern said at the daily Covid-19 update today that people could now travel for tourism as long as they minimised risk, followed social distance guidelines, and maintained hygiene.

“It’s not so much the travel, although we want you to do that safely, it’s what you do when you get there that also matters,” Ardern said.

“So, of course, if you are engaging in activities with your family and you’re maintaining physical distance when you are out and about, you’re mindful of your personal hygiene, then yes.”

The Government’s Covid-19 website was today updated for level 2 criteria and now stated:

“You can travel around the country if you follow good personal health measures. You will need to keep records of what travel services you use and keep track of who you have been in contact with. You should keep your distance from groups of people you don’t know. You should minimise the number of places you stop on the way to your destination.”

However, you could not travel to attend any events of more than 100 people, which are still banned under alert level 2.

No-one would be allowed to travel if they were displaying symptoms of  Covid-19, awaiting a test, or if they needed to self-isolate.

Workplaces could now operate if they were able to do so safely and they could have customers if contact tracing was in place and there was physical distancing of 1 metre between groups of customers.

On ski fields, Ardern suggested they, like golf courses, could open as they were different to large gatherings of people inside a confined space.

“Open-air, obviously, golf courses for instance, places where you have a large number of players, it’s obviously different sets of circumstances when we are talking about those mass gatherings,” Ardern said.

“It’s where you’ve got those congregations of individuals that we really need to be very mindful of the contact that people have with one another.”

While people could attend weddings, funerals, family events, concerts, religious services and public meetings the events could not have more than 100 people.

Government guidelines stated that indoor gatherings should be seated if possible, and should be approximately two hours long. While food and drink consumption was permitted they had to be served individually and not from a buffet.

Public venues, such as museums, food courts, markets, gyms and swimming pools would also be open again at alert level 2, with social distancing restrictions.

The NZ Super Rugby and ANZ Premiership Netball professional leagues would go ahead at level 2 because they took place in controlled workplaces but people could not attend in person.

Bars, cafes and restaurants could open provided groups were seated, separated, and used a single server if possible. Again, buffets would not be allowed.

Hospitality operators would have to keep a contact tracing system and to maintain physical distancing of 1 metre between groups.

A decision on when the country moved to level 2 is expected on Monday.

More information on the level 2 guidelines can be found here with more details to be unveiled in the coming days.

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