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Airlines will have to do away with undisclosed hidden fees that passengers often have to deal with, under new proposed government legislation.
The news was announced by King Charles III during the King’s Speech at the state opening of Parliament in Westminster yesterday.
The king announced that airlines must now be more transparent with what flights actually cost when advertising them, meaning that ‘drip pricing’ – where a cheap fare is advertised before the extra cost is revealed later – must come to an end.
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This is a well-documented practise amongst budget airlines, who offer a cheap ticket, before then later charging for seats, luggage, and other extras along the way.
Prime Minister Rishi Sunak has decided that this needs to stop, and is therefore proposing legislation against it.
Under a new Digital Markets, Competition and Consumers Bill, companies will have to be more transparent about the real price of things, and what customers will be expected to pay against what is advertised.
This won’t make flights cheaper, but it will make it more obvious when there are hidden costs to pay after the advertised price.
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Examples of ‘drip-pricing’ include extra costs for things like luggage, seat choice, and printing of boarding passes.
Consumer group Which? welcomed the move, calling drip-pricing ‘an underhanded way of squeezing extra cash out of consumers’ and said it is ‘particularly concerning during a cost-of-living crisis, when it’s more important than ever for shoppers to be able to stick to a budget.’
The law will also help to tackle ‘unscrupulous’ traders attempting to trap people into subscriptions that they don’t want anymore, and take action against fake reviews and confusing labelling.
All of those things make it hard for consumers to make informed judgements and choices, and unwanted subscriptions are currently estimated to cost consumers £1.6 billion per year.
As per PA News Agency, the bill includes already announced powers allowing the Competition and Markets Authority to take action against bad business practices without needing lengthy court action.
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The Bill is expected to deliver a consumer benefit of £9.7 billion over 10 years from stronger laws, new rights and more competition.
Between April 2020 and April 2021, 69% of UK consumers experienced problems with items or services that caused them stress, cost them money or took up their time, and are estimated to have carried a net cost of £54.2 billion.
Rocio Concha, Which? director of policy and advocacy, said: “Our competition and consumer protections are in desperate need of an upgrade, so it’s good to see the Government moving forward with the Digital Markets, Competition and Consumers Bill, which should clamp down on harmful practices like fake reviews and drip pricing, while empowering the new Digital Markets Unit (DMU) to rein in anti-competitive behaviour by the biggest tech firms.
“However, efforts to increase competition in digital markets risk being undermined if the Government bends to lobbying from tech giants.
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“The Government should resist calls that would let Big Tech weaponise the legal system to frustrate decisions by the DMU, and allow the regulator to focus on improving choice and lowering prices for consumers.”
Sir Keir Starmer dismissed the King's Speech as 'an exercise in economic miserabilism' and said it was a 'King’s Speech with no concern for the national interest, wallowing in a pessimism that says the hard road to a better future isn’t for Britain.
"It’s been this way for 13 years now."
Tom Wood