Issue: 17/08

Consumer Representation

May 7, 2008

A stronger voice for consumers – The Minister’s Telecommunications Consumer Representation Stakeholder Forum
The forum was held on 1 May 2008 to identify ways to make consumer representation in telecommunications policy more effective.

ATUG took part in the Forum to ensure the interests of business users of communications services were represented.

The forum discussed ways in which current consumer representation strategies can be improved and concluded with a commitment from consumer representatives to establish a peak telecommunications body representing the diversity of consumer interests. ATUG looks forward to working with the Consumer Peak Body in a coalition of demand side interests on issues which are relevant to good outcomes for all types of consumers in coming years.

The Minister was open in his views on the importance of making consumer representation in telecommunications policy making more effective, highlighting the issues consumers face in an environment of continual technological change, globalisation, evolving market structures and new business models.

Key issues included:
• making sure consumers were well-informed and could make good product and service choices.
• improving current consumer representation strategies to give consumers a stronger unified voice.
• empowering consumer representation and improving the interface between consumer groups, industry, and
• strengthening the self-regulatory regime to achieve better outcomes and better informed consumers.

The Minister first raised the issue of better representation for the consumer voice at ATUG 2008:
“I am strongly committed to engaging with all stakeholders, and I believe this is the best way to develop and implement policy.

There is no doubt increased competition, investment in infrastructure, and the introduction of new technologies will provide many benefits.

However, a sustainable telecommunications industry ultimately relies on maintaining a healthy relationship with consumers.

According to a recent OECD paper on Protecting and Empowering Consumers, informed consumers are a necessary part of the mix.

They are able to stimulate innovation and competition, improving quality of service and prices.

In balancing the needs of industry and consumers, self-regulation is a key element of Australia 's current telecommunications regulatory regime.

However, if industry self-regulation is to remain a viable form of regulation for telecommunications, it is incumbent on the industry to ensure that the interests of consumers continue to be adequately represented and protected.

Unfortunately, there are signs that the interests of consumers are falling behind in the current environment of increasing competition and product complexity.

I am concerned about the recent increase in complaints to the TIO.

It is clear that industry members need to take greater responsibility for dealing promptly with consumer complaints.

And they must be seen to be doing so by consumers, or risk undermining confidence in the independent complaints resolution mechanism.

Development and implementation of industry codes of practice is another area of concern.

From my perspective, industry doesn't appear to be in a hurry to ensure these vital consumer protections are in place.

Industry members need to be much more responsive to the interests of consumers, and respectful of the needs and experiences of individual consumers.

To ensure that self-regulatory mechanisms continue to adapt to emerging technologies and services, consumers need to be given a strong voice in the development of codes and other protections.

And new arrangements need to be made quickly as issues emerge, and they must be reviewed regularly as services evolve.

The Government is also looking at what it can do to enhance overall consumer protection.

In particular I want to look at ways to give consumers a more powerful voice in the development of telecommunications policy, and in particular, industry codes.”

The full speech is available here

At the forum ATUG made the following comments:
• The role of consumers to making markets effectively competitive is key – empowered consumers making good decisions and being able to switch providers with minimum angst is as important to effective competition as access rules. ATUG supports the OECD work in this area.

• Self-regulation is only effective where industry faces incentives to encourage good self-regulatory outcomes. ATUG’s experience in raising broadband switching experiences is a case where without incentives (from the ACCC) there was no industry interest in improving customer switching processes. Mobile number portability is another example where regulatory action was needed to spur industry action – with a world class result for Australian consumers and an effectively competitive mobile market in metropolitan areas at least.

• End users need ongoing dialogue directly with the Minister. The issues include availability/access/affordability, accessibility or "connectedness”, information and choice, contract issues and complaints. Economic efficiency and equity are both important to end users.

• Resource and information asymmetry are key issues to ensuring effective representation of end user interests in policy development and regulatory decisions. Funding needs to keep pace and be on a multi-year basis to reflect the development of issues and skills needed.

• The role of the Consumer Peak Body would include:
o Representation
o Research
o Advocacy
o Review of outcomes – implementation, compliance, prices
o Information dissemination

• An effective Annual Meeting schedule would include at a minimum:
o Meeting with Minister
o Joint ACMA/ACCC Consumer Forum
o Meeting with Senior Departmental officers/Minister’s Advisers
o Joint ACMA/ACCC Consumer Forum

• A Transition Plan needs to be resourced to work through the scope and details to allow the establishment and funding of the Consumer Peak Forum

ATUG welcomes the Minister’s initiative in establishing the Stakeholder Forum, in being clear about the issues that need addressing and focused on good outcomes from communications policy and regulatory activity for consumers as well as industry.

ATUG was pleased that the Minister is committed to telecommunications specific consumer representation and is prepared to fund this activity to ensure better outcomes.