Aviation Consumer Protection Bill 2026, Aviation Consumer Protection (Consequential Amendments and Transitional Provisions) Bill 2026, Aviation Consumer Protection Levy Bill 2026, Aviation Consumer Protection Levy (Collection) Bill 2026
Dr LEIGH (Fenner—Assistant Minister for Productivity, Competition, Charities and Treasury) (16:53): Australia has an unusual aviation market. A population our size is thought by many experts to be able to support about three airlines, and we do have three airlines. The problem is that two of them are owned by the same company: the Qantas group.
That means that the Qantas group and Virgin have 98.5 per cent of the market. The top two players having 98.5 per cent of the market means that industries like banking and telecommunications look pretty competitive by comparison. This is one of the most concentrated industries in Australia.
Most regional routes are monopolies and, as work carried out by the competition taskforce in Treasury by Omer Majeed in conjunction with Robert Breunig at the Australian National University has shown, there is a strong relationship between the lack of competition and the prices that flyers pay. When one airline services a route, they find, airfares average 39.6c a kilometre.
When two airlines compete, the average fare drops to 28.2c per kilometre. With three competitors, it drops to 19.2c. In other words, if you've got a route where there are three competitors, flyers are paying about half the price per kilometre that they pay over a monopoly route.
Even the threat of competition, researchers have found, brings down lower prices. Australia's aviation history points to the same pattern. Before the Second World War, more than a dozen airlines operated in Australia, and our aviation volume in that period was among the highest in the world.
But, from the fifties to the 1980s, a duopoly prevailed and kept prices high. Only with the deregulation of aviation in the late 1980s did flying become affordable for many middle-class families and small-business people. It's still not competitive enough.
Many residents of Darwin have noted that it is sometimes cheaper to fly from Darwin to Singapore—a longer, international flight—than it is to fly the domestic flight from Darwin to Sydney. Where we see a high degree of market concentration, we often see problems for consumers. As the assistant minister responsible for competition, I'm keenly interested in the way in which our competition and consumer reforms interact.
As a Canberra representative, I also have been keeping a keen eye on the cancellation rate of the Sydney-to-Canberra flights. For a period, that was the most cancelled route in Australia. In the most recent data, for May 2026, five per cent of those flights were cancelled, making it the fourth-most-cancelled route in Australia.
That's an improvement, but there is still a way to go. In December last year, according to data presented by the transport minister in her second reading speech, over a quarter of domestic flights were delayed on arrival and delayed on departure. While there's been an improvement in on-time performance since the COVID pandemic, there is a need to better protect aviation consumers.
This is hardly an isolated issue. Research from the Behavioural Economics Team of the Australian Government shows that more than half of all Australians travel by air in any given year, and about half of those travellers experience a flight disruption. How do people feel when they experience a flight disruption?
Well, only a third of those travellers were satisfied with how their disruptions were handled. Australians with disabilities, medical conditions or injuries, who account for about a quarter of air passengers, report even lower levels of satisfaction as to how their disruptions are handled. That's why the government is putting in place a more coherent aviation consumer protection framework and putting in place aviation consumer protections that clarify airline obligations and the minimum level of assistance required when a scheduled flight is disrupted.
Our bill will establish the independent aviation consumer ombudsperson to assist in resolving complaints, will pave the way for an aviation consumer protections charter that sets out the minimum standards that aviation consumers can expect from airlines and airports, will establish the aviation consumer protection authority and will establish an aircraft noise ombudsperson.
We know that the current system of airlines policing themselves has not worked, and our reforms represent an unprecedented increase in protections for Australian travellers. At the outset, I mentioned that the airline industry is highly concentrated, but that's not the only part of the aviation ecosystem that is concentrated. Our airports in most cities operate as monopolies.
Where there is a second airport, such as the airport in Geelong, it provides relatively little competitive pressure to the major airports. The exception to this is going to be Western Sydney International Airport, which we are proud to support and which will provide, when it opens in October, a huge improvement to the degree of competition in Australia's largest city.
Labor believes in competition; Labor believes in looking after consumers, and this bill and the government's reforms do both. This bill is based on work carried out in the Aviation white paper: towards 2050, which is a series of 56 policies that set the direction for the aviation industry to give passengers a better deal and enhance competition while ensuring the aviation sector maintains Australia's strong safety record.
People who are nervous about flying can often be reminded that the most dangerous part of any trip is the drive to the airport, not the flight itself, thanks to the hard work that has been done by the aviation sector to maintain high safety standards. This work, drawing out of the white paper, is supported by feedback from consumers, consumer advocacy groups and fair trading regulators who've told us in recent years that the domestic airline industry has demonstrated poor customer service and decreasing service quality and that the industry led body the ACA, the Airline Consumer Advocate, has been ineffective at resolving disputes.
The experts have advised us that what we need to do is put in consumer pathways that, unlike the current processes, are clear and do not vary in their effectiveness. By putting in place the Aviation Consumer Protections Charter, we will establish minimum standards that consumers can expect from airlines and airports. They will be able to seek redress through the Aviation Consumer Ombudsperson if they are dissatisfied with the way in which an airline or an airport operator has managed their complaints.
The charter will create obligations for airlines and airports. It will support greater public transparency and accountability through facilitating the reporting and publication of reasons for flight delays, cancellations and disruption to the department and consumers respectively. That ensures that, in instances in which unavoidable fog delays are causing problems, consumers know and can distinguish that from instances in which a plane is simply taken out of service in order to assist on another route or two flights are combined in order to boost the revenue of the airline.
This was apparently one of the causes for the very high degree of cancellations of Sydney-Canberra flights, which hit a high of one in eight flights a couple of years ago. Apparently, what was happening was that, largely, Qantas was choosing to use the planes flying from Sydney to Canberra as fill-ins for regional flights out of Sydney where those planes experienced mechanical problems.
Flyers between Sydney and Canberra shouldn't be put in the position of feeling that, if you buy a ticket between Sydney and Canberra, you're buying an option for the airline to fly you in the event that enough other passengers also want to fly at that time. People deserve certainty, in particular, when they're flying for important business meetings; for family commitments such as funerals, weddings or birthdays; or for other important personal reasons.
The certainty of the flying public will be improved as a result of the reforms in this bill. This bill will put in place an ability for the Aircraft Noise Ombudsperson to carry out independent reviews of Airservices Australia's and Defence's management of aircraft noise related activities. It will improve outcomes for consumers, and it will ensure that the aviation sector is accountable for the services they offer and is focused on aviation consumers.
This bill will apply to airports that receive more than a million passengers a year. This means that it'll apply to Australia's 14 largest airports and Western Sydney airport and will capture 93 per cent of passenger movements through Australian airports. That means that small airports—which are commonly council owned or in regional, rural and remote Australia—are not subjected to the same degree of scrutiny as the larger, more commercial airports.
This will be important in reducing the uncertainty that the flying public faces and improving the knowledge of rights that the flying public has. In a highly concentrated sector, it is appropriate that we put in place stronger consumer safeguards. Labor's consumer focused reforms have indeed, in many cases, focused on highly concentrated sectors.
On Saturday, I stood up in Dickson, in front of Coles and Woolworths, to remind people that, on 1 July, Labor's supermarket price gouging laws come into effect. That applies to the biggest two supermarkets which, between them, have two-thirds of the market. As they say in Spider-Man, 'With great power comes great responsibility,' and, in concentrated sectors, we do need to be holding those major players to account.
Textbook economics since Adam Smith has taught us that monopolies and oligopolies have a propensity to raise prices beyond a reasonable profit margin plus the cost of supply. It teaches us that there is a risk to consumers where sectors are highly concentrated. That is why we have increased penalties for anticompetitive and anticonsumer conduct, from a maximum dollar figure of $10 million when we came into office to now, a maximum dollar figure of $100 million.
It's why we're cracking down on shrinkflation through a review of the unit pricing code of conduct. It's why we've put in place the mandatory food and grocery code, which implements multimillion-dollar penalties on supermarkets who do the wrong thing by their suppliers, replacing the toothless, voluntary code that existed under the former coalition government with a food and grocery code that properly protects farmers.
It's why we have been so passionate about national competition policy, now revamped by the Treasurer's leadership with a $900 billion productivity fund, engaging the states and territories on those pro-competition reforms. These are reforms that, in the 1990s, saw a huge increase in productivity, delivering thousands of dollars into the household budgets of the typical Australian household.
Labor's productivity-boosting competition reforms will do so again, and the modelling for Treasury suggests that the benefit to Australian consumers is extremely high. From 1 January 2027, Labor is scrapping non-compete clauses for nine out of 10 workers, making it easier for a worker to move to a better job. For a government that's passionate about competition policy, a non-compete clause is like a red rag to a bull.
We want to get rid of these clauses because they're gumming up the Australian economy, making it harder for startups to get off the ground and harder for early-childhood workers, security guards and disability support workers to move to better jobs. Labor's merger reforms, which kicked in from 1 January this year, were the biggest shake-up to our merger laws in some 50 years, recognising the value of careful merger scrutiny but also the value to business of getting quick approvals for low-risk mergers—more attention on the high-risk mergers and less attention on the low-risk mergers.
Allow them to go through in the interest of productivity and focus on the ones that are going to have the biggest competition risk. Labor's passion for consumer reform and competition reform is reflected in this bill, which looks after aviation consumers. I commend it to the House.