According to telecoms industry peak body Communications Alliance that’s the position of telcos following Financial Counselling Australia’s (FCA’s) report on their recent survey of financial counsellors, with CA CEO John Stanton noting that financial counselling is a vital service for many Australians, and the FCA report shows that “financial counsellors have had some mixed experiences when working with telcos on behalf of their clients”.
“Clearly, there are some good practices in the industry – including a set of additional safeguard principles, in place since May 2020, to assist consumer and small business customers experiencing financial difficulty during the COVID pandemic period,” Stanton said.
“While we are still studying the FCA’s report, it does point to areas of potential improvement and we will further engage with FCA on the detail of the survey responses. The performance of telcos in the financial hardship space is subject to the requirements of a registered Industry code and is also closely scrutinised by the industry regulator, the ACMA.”
“All providers are required to publish their Financial Hardship policy on their website, including guidance on how to apply for assistance, and we strongly encourage anyone having difficulties paying their bills to contact their telco.
“Telcos are always seeking to improve the customer experience, particularly for those experiencing hardship. We appreciate the role that financial counsellors play in providing feedback on how we are doing and in challenging us to do better.”
Stanton said Communications Alliance understands that the survey is intended to form part of the discussions industries, Government and Financial Counselling Australia have had in recent months on the possibility of a multi-sectoral industry contribution towards the funding of financial counselling, as part of broader recommendations from the 2019 Sylvan Review on how to ease the administrative burden on financial counsellors and provide stable funding.
“Communications Alliance has been supportive in principle of the Government’s overall policy objectives throughout these discussions,” Stanton added.
“However, we have regularly voiced concerns about the limited data so far made available, and the challenges this poses to constructing a robust, equitable, inclusive and proportionate proposal for a scheme that would entail a significant financial contribution from the various captured industries.
“We appreciate the work of Financial Counselling Australia on this survey, and consider it as an important input both towards the discussions of any funding model and how to further improve services to customers.
“The fact that 74% of respondents said less than half of their clients had a telco debt, and the fairly significant range in responses, is further evidence that Government should take steps to coordinate the funding of financial counselling and gather national quantitative data to inform the development of any industry funding model.”
Stanton says it is important to “recognise that financial hardship rarely results from difficulty in paying a single type of household bill. Alongside the recurring expenses associated with housing, financial services, utilities and food, telecommunications costs tend to make up only a small percentage of monthly household expenditure.”
“There are significant opportunities to solve existing problems of funding timing and administrative burden for financial counsellors, and while doing so to gather national data on the drivers of financial counselling.
“We strongly encourage Government to continue working on these challenges, and look forward to further contributing towards these important discussions and the development of workable solutions,” Stanton concluded.
For further information on financial hardship assistance, Communications Alliance points to Chapter 7 of the Telecommunications Consumer Protections (TCP) Code which is dedicated to financial hardship assistance.
CA says that among other requirements, Retail Service Providers (RSPs) must offer a minimum of three of the below options to help keep residential and small business customers connected:
- Spend controls;
- Restriction of service, in respect of overall or specific services;
- Transferring the Customer to a Pre-Paid Service;
- Transferring the Customer to a contract which includes hard caps or Shaping; or
- Low cost interim options until the Customer can continue with original payments.
and a minimum of three of the below options for suitable financial arrangements:
- Temporarily postponing or deferring payments (for a longer period than would typically be offered to Customers requesting an extension outside of Financial Hardship arrangements);
- Agreeing on an alternative arrangement, plan, or contract, including discussing Pre-Paid Services;
- Discounting or waiving of debt;
- Waiving late payment fees;
- Waiving cancellation fees; or
- Incentives for making payments, for example payment matching.