Hard on the heels of pledging a crackdown on excessive surcharges, the Albanese government has promised legislation to ban unfair trading practices.
Author
Michelle Grattan
Professorial Fellow, University of Canberra
The government said this would include specific prohibitions on various “dodgy” practices.
“From concert tickets to hotel rooms to gym memberships, Australians are fed up with businesses using tricky tactics that make it difficult to end subscriptions or add hidden fees to purchases,” the prime minister, treasurer and assistant treasurer said in a statement.
“These practices can distort purchasing decisions, or result in additional costs, putting more pressure on the cost of living.”
They said the government would deal with
“subscription traps” that make it difficult to cancel a subscription
“drip pricing” characterised by hidden fees or fees added during the purchase
deceptive and manipulative online practices. These aim to confuse consumers, such as for example by creating a false sense of urgency, warning there is only a limited time to purchase
dynamic pricing, where a price changes during the transaction
requiring a consumer to set up an account and provide unnecessary information for an online purchase
a business making it difficult for a consumer to contact it when they have a problem with the product.
Earlier this week Arts Minister Tony Burke said on the ABC the government was not looking at “dynamic pricing” in the music industry.
Asked on Four Corners whether dynamic pricing should be allowed in Australia, Burke said: “Surge pricing is something that, as consumers, people have always dealt with.
“I don’t love it, but I think we have to be realistic, it’s always been there. It’s not something we’re looking at, at the moment.”
Asked about the discrepancy, a government spokesperson said the Four Corners interview “was recorded a month ago, before this policy existed”.
Treasury will consult on the design of the planned changes. The government on Wednesday will put out a consultation paper on reforms for greater protections for consumers and small businesses under the consumer guarantees and supplier indemnification in the Australian Consumer Law.
The government says it will work with the states to have a final reform proposal in the first half of next year.
There will be penalties for suppliers that refuse to give consumers a remedy such as a replacement product or a refund when legally required.
“Currently, it can be difficult for consumers to obtain a remedy, especially when engaging in the digital economy,” the government statement said.
The reforms would empower the Australian Competition and Consumer Commission and state and territory agencies to pursue breaches of consumer guarantees and supplier indemnification provisions.
Prime Minister Anthony Albanese said “hidden fees and traps are putting even more pressure on the cost of living and it needs to stop”.
