Virgin Australia has been criticised for pocketing $93 million in COVID-era flight credits, which are due to expire within weeks.
Travellers received the credits after bookings between April 2020 and July 2022 were cancelled due to pandemic restrictions, with airlines issuing vouchers or credits in place of refunds.
Virgin said those who still hold an unused credit must book and complete their travel by June 30, or risk losing the remaining value.
Senator Bridget McKenzie says the money belongs to Australians and it was unacceptable for the company to keep it. (ABC News: Philippe Perez)
Senator Bridget McKenzie has called on the airline to extend the expiry date or refund the money, saying it represents “real cash” paid by customers and should not be retained by the airline.
“COVID travel credits are not loyalty points, they are customer money,” Senator McKenzie said.
“Returning this $93 million to Virgin’s bottom line would be, frankly, unacceptable. It’s Australian consumers’ money.“
Virgin Australia says the majority of COVID credits have already been redeemed. (ABC News: Billy Cooper)
She said many households were struggling with cost-of-living pressure and may not have been able to use the credits, and that the airline should follow the lead of other carriers that extended the vouchers or refunded customers.
Both Qantas and Jetstar’s credit systems do not have an expiry date.
In a statement, Virgin Australia said the majority of COVID credits had already been redeemed, and that customers were repeatedly notified about expiry dates over several years.
“Despite extensive efforts and regular reminders to our customers, the remaining credit balances are seeing almost no usage,” a Virgin Australia spokeswoman said.
She said more than 90 per cent of credits had already been redeemed.
‘I thought it was a scam’
Rockhampton resident Peter Kernke said he only discovered his family still had a $412 Virgin credit after receiving what he initially thought was a scam email warning it was about to expire.
The credit related to a flight cancelled during the pandemic while his wife was travelling between Rockhampton and Sydney to visit her dying mother.
Mr Kernke said it took more than an hour on the phone with Virgin Australia to access the account because the booking was not linked to his wife’s frequent flyer profile.
Peter and Christine Kernke only recently discovered they had a Virgin flight credit. (Supplied)
Once he gained access, he discovered the family had less than a month to use the credit.
“We didn’t have a trip planned in the next month,” he said.
Mr Kernke said the short deadline made it impossible to redeem the money.
“They’ve had our money for five years and now they’re just saying, ‘thank you’,” he said.
“We might fly with them again, but will we ever trust them? No.“
Consumer advocates say many travellers may no longer be well enough to travel, or were flying for a funeral or specific event at the time. (ABC News: Billy Cooper)
Choice communications and campaigns director Andy Kelly said Virgin should offer refunds to customers who didn’t use their credits by June 30.
“Many consumers book flights for a specific purpose,” he said.
“If the flight is cancelled, they may no longer have a reason to fly.
“We heard from many consumers during the COVID-19 pandemic who were no longer well enough to travel, or who were travelling for a funeral or other specific event.”
Customers should also check their “Virgin Travel Bank” to see if they have any points.
