The issue

Our research
Read CHOICE's joint report with Galexia Consumer Protection in the Communications Industry.

Consumer complaints about telecommunications issues are soaring. There was a 31% increase in the number of complaints to the Telecommunications Industry ombudsman in 2007.

This followed significant increases in complaints in the two previous years — for example an 81% increase in complaints about mobile phone services in 04/05. In 2007 the TIO received more than 1,000 complaints every month about mobile premium services (19x numbers) alone.

But consumer protection in this industry falls far short of good practice.

Consumer protection in telecommunications is almost wholly based on a self regulatory (or 'co-regulatory') system. The Telecommunications Act provides for the development and registration of industry codes of conduct on consumer issues, with a regulator in place to monitor codes of conduct and enforce non-compliance.

We believe that co-regulation, properly designed, can play a role in producing effective consumer protection rules with reduced cost and increased responsiveness. But the current legislative scheme, consumer advocacy arrangements and code development culture are not working.

The legislation itself is silent on consumer protection issues, the codes of conduct are not subject to an effective system of signing and compliance, and monitoring and enforcement are applied inconsistently.

What we want

CHOICE suggests the following key elements are required to move forward on better consumer protection in telecommunications:

• A comprehensive review of current co-regulatory arrangements for consumer protection.
• Establishment of regular effective communication processes between consumer organisations and government.
• Strengthening consumer representative processes.
• Strengthening funding for telecommunications consumer advocacy and research.

What we're doing

CHOICE has prepared a report identifying what we believe are some of the weaknesses in the current co-regulatory arrangements and some suggestions for improvement.

We have also written to the Minister for Communications congratulating him on his interest in reform in this area, and making the points set out above.

Mobile premium services are a particular problem area. See Consumer Protection in the Telecommunications Industry