ACMA finds Telstra wrongfully cut off 5,400 vulnerable customers, proving stronger laws are needed
“Instead of offering fair and suitable hardship arrangements to support customers struggling to pay their bills, Telstra and other telco providers continue to breach their own industry rules by cutting off customers without consequence,” says Stephanie Tonkin, CEO of Consumer Action Law Centre.
“In the midst of the worst cost-of-living crisis in a generation, it’s time the Federal Government took action to introduce mandatory laws to ensure the regulator, the Australian Communications and Media Authority (ACMA) can force telco providers to comply with the law. We are calling on Minister Rowland to act now before more customers are cut off from this essential service,” she said.
An investigation by ACMA found between 10 May and 19 July 2022 that more than 5,400 Telstra customers equivalent to 76 people a day were unlawfully suspended or restricted by Telstra without notice as required under the Telecommunications Consumer Protection.
“Over a year, that could equate to more than 25,000 Telstra customers wrongly disconnected from essential services as part of aggressive debt collection practices. I think it’s a shocking statistic from just one telco provider,” said David Hofierka, Senior Policy Officer at Consumer Action.
Restrictions and suspensions of a service often have the same devastating impact as a disconnection, where people are unable to make or receive calls, SMS or use their internet.
“People should not be disconnected from an essential service needed for safety, work, to contact children, to call doctors or other vital services such as your bank or Centrelink. This type of action can have devastating consequences,” he said.
Although many were reconnected after further payment was received, as revealed in a recent report by ACCAN, many of these customers likely sacrificed basic essentials such as food, heating and energy, borrowed from friends or family, or turned to unregulated credit like buy-now-pay-later and wage advance in order to get reconnected.
Mr Hofierka said that, despite the wide-reaching impacts of this breach on vulnerable people, it’s likely Telstra will only get a “slap on the wrist” because the regulator, ACMA, does not have the power it needs to force telcos to act responsibly.
“The current telecommunications regulatory framework, which Telstra has signed up to on a voluntary basis, does not empower the ACMA to penalise telco providers for such breaches of the law, no matter the scale and severity of the breach,” he said.
This is unlike other industries, such energy, where regulators can take timely and effective action, deterring such bad behaviour.
“Warnings by themselves are not enough to ensure telco providers put customers’ needs first. Disconnections, restrictions and suspensions of service should only be used as an absolute last resort, if ever, when people are struggling with their bills, let alone arbitrarily in breach of the law,” said Mr Hofierka.
ENDS
Media contact: Mark Pearce, Media and Communications Adviser, 0413 299 567, media@consumeraction.org.au
