This was published 3 years ago
Travel refunds due to COVID-19: Six months on, some travellers are still waiting
By Josh Dye
Flight Centre and Travel Associates have refunded 144,000 bookings worth $800 million since March, but still have about 66,000 claims outstanding.Credit: Darrian Traynor
Tens of thousands of Australians are still waiting on refunds for cancelled travel, more than six months after the COVID-19 pandemic caused mass disruption to holiday plans.
Australia's consumer watchdog has seen a 724 per cent surge in travel-related complaints compared to last year, while airlines and travel agents have been inundated with refund requests after borders closed and tourism collapsed.
Flight Centre and Travel Associates have refunded 144,000 bookings worth $800 million since March, but still have about 66,000 claims outstanding. Group managing director James Kavanagh said Flight Centre received four years' worth of claims by May, at the same time as travel agencies closed and staff were laid off.
Cathy Vitale from Sydney paid Flight Centre $11,585 for an 18-day European holiday in April with her husband Nat and is still waiting on the refund.Credit: Wolter Peeters
"We turned from selling travel and dreams into a refund business. The travel industry is not built for reverse engineering at scale in a short period of time," Mr Kavanagh said.
"When we take money from a customer, that money is moved to a supplier to lock down the booking. To repatriate that money from sources all over the world is a huge role."
Cathy Vitale from Sydney paid Flight Centre $11,585 for an 18-day European holiday in April with her husband to celebrate their 30th wedding anniversary and her 50th birthday.
Six months since requesting the refund, Mrs Vitale is still waiting for the money. She said the company offered her a partial refund of $7998 but her patience is wearing thin.
"I don't know what to do now," she said. "During the time I've been dealing with this I've been diagnosed with early stage melanoma. I'm just really needing the money back so I can put it towards that. I just feel really sick in the stomach about it."
Katie Triebel in Melbourne is still waiting for Flight Centre to refund $1500 out of an $8000 Japan holiday she booked to celebrate her anniversary with her partner.
Ms Triebel said it's been four months and her agent has ceased responding since promising the refund would land within the last two weeks.
"I just want the last lump sum of it back so I can wipe Flight Centre forever," she said.
The Australian Competition and Consumer Commission said it received 19,260 complaints relating to travel between March and September, compared to 2337 during the same period last year.
An ACCC spokesman said businesses should honour the terms and conditions of each booking, and where refunds are due they should be paid "within a reasonable time". However he urged consumers to "remain patient" due to the "unprecedented and complex" nature of the circumstances.
"In particular, it may take travel agents longer to process refunds as they often have to wait for funds to be secured from their travel partners before processing," the spokesman said.
On Tuesday Emirates said the airline has processed 1.4 million refund requests worth $1.9 billion since March, with a further 10 per cent of claims to process. Last month Qatar Airways said it had refunded $1.6 billion to almost 600,000 passengers in the same period, with just 4 per cent of claims outstanding.
Air New Zealand said it refunded an average of $21 million a week between April and June, finally completing its backlog of claims at the end of August. Qantas and Virgin declined to provide details of their progress on refunds.
Flight Centre's Mr Kavanagh said refunds are complex because agents are often dealing with several suppliers within one customer's booking, and each supplier has their own refund policies and liquidity problems.
Mr Kavanagh cited the example of some US cruise lines which sometimes send three separate cheques in the mail for different amounts of the booking.
He said funds are returned to customers within five business days of being received from suppliers and "categorically" denied that Flight Centre holds onto the money.
Mr Kavanagh said he sympathised with people affected by the delays and promised Flight Centre was "doing everything to win back the support".
"If I put myself in the shoes of the customer and for those who've been disgruntled, I think it's reasonable for them to be incredibly unhappy because they weren't getting the service they expected," he said.
Adam Glezer runs several Facebook pages providing assistance and advocating for consumers seeking refunds.
"I think the lack of transparency is the biggest issue," Mr Glezer said.
"In a lot of situations, customers are feeling helpless because their supplier is telling them that they have to speak with their travel agent. However, their agent is telling them they have no further updates to provide."
See also: One of our biggest industries is being destroyed, but we don't seem to care
See also: Think Australia's travel ban is fair? This will change your mind
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