Virgin Australia

The Shonky Award for forcing customers to book under pressure.

It’s a practice that pushes the boundaries of consumer law and common decency. You’ve paid for something and didn’t receive it, but the business is holding onto your money. Despite the non-delivery of goods or services, refunds are not on the table.

Thus begins the troubling story of Virgin Australia’s unused flight credits. These credits are made up of customer payments for flights cancelled between 21 April 2020 and 31 July 2022 due to the COVID-19 pandemic.

In February, Virgin reported that it had around $93 million squirrelled away from this difficult period of lockdowns and the long pause on life as we knew it. In its annual report released in late August, the airline said it counted $75 million in expired COVID-19 credits as part of its 2026 net profits. Some customers redeemed their credits, but many others never saw their money again.

Virgin refuses to budge on booking deadline

In a better world for Australian travellers, they’d get their money back when a flight is cancelled, or at least have it automatically refunded when credits expire.

CHOICE called for all airlines to make refund rights clear at the time of booking in our 2025 submission to the federal government on airline rights, but it is not current practice.

Virgin had initially indicated that these flight credits would expire on 30 June 2026. Your money would have been up in smoke if you didn’t book a flight that departed before that date. This didn’t go over well with Virgin customers, and the airline sort of backed down.

It likely meant scrambling madly to organise a trip, whether or not it was practical to do so

The revised policy was an improvement, but not by much.

The deadline for booking flights with outstanding credits was still 30 June 2026, but Virgin extended the deadline for taking flights to 27 May 2027.

For those who managed to reclaim what they’d paid for and make a booking before the June deadline, it likely meant scrambling madly to organise a trip, whether or not it was practical to do so.

Customers need refunds, not forced travel

CHOICE senior policy and campaigns adviser Bea Sherwood says that consumers absolutely should not be footing the bill for cancelled flights.

“Expiring credits should be automatically converted to refunds and consumers shouldn’t have to chase them. Virgin’s unfair credit policy means countless people will never see their hard-earned money again,” she says.

“If we can’t rely on airlines to provide this basic entitlement, the government needs to step in and make it a requirement under the Aviation Consumer Protections Charter.”

Virgin’s unfair credit policy means countless people will never see their hard-earned money again

CHOICE senior policy and campaigns adviser Bea Sherwood

Senator Bridget McKenzie, the Shadow Minister for Infrastructure, Transport and Regional Development, voiced her displeasure when all this was happening.

“In the middle of a cost-of-living crisis, giving people just a handful of days to actually book flights to use these credits over the next 12 months is absolutely not good enough,” Senator McKenzie told the ABC at the time Virgin announced the new deadline for taking flights, just 12 days before the original booking deadline.

Prompt and fair remedies should be a given

It brings to mind the equally unbecoming behaviour of Australia’s biggest airline, Qantas, which made redeeming COVID-19 flight credits an exercise in frustration if not futility. This paved the way to a 2022 Shonky Award for the flying kangaroo, and Virgin’s equivalent failures underscore the pressing need for stronger aviation rights for Australians. (In fairness, Qantas did offer refunds for expiring COVID-19 credits.)

At the time of publication, Australian travellers were still waiting for the launch of the Aviation Consumer Ombuds Scheme, an independent dispute resolution service that will theoretically hold airlines to account for their mistreatment of customers.

The Ombuds Scheme will be tasked with putting the finishing touches on the new Aviation Consumer Protections Charter. The draft version of the charter calls for “prompt and fair remedies” after cancellations. It really shouldn’t be too much to ask for.