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EU passenger rights — auditing a policy that really matters to citizens

Source: European Parliament.

Probably everybody travelling in Europe and beyond has experienced it at some point. For reasons beyond your control, you experienced significant delays, your luggage got lost, or the assistance promised was not delivered. What are your rights then? And how consistent can they be put into practice when travelling by air, rail, bus or boat? The ECA looked at this aspect of transport and mobility from the perspective of the citizen using public transport in its special report 30/2018. Erki Must was the head of task for this very special audit, dealing with an EU policy that directly matters to citizens. What is his take of the audit and why does it stand out compared with some other ECA audits done on transport and mobility issues.

By Erki Must, Investment for Cohesion, Growth and Inclusion Directorate

EU passenger rights — a very special audit

I am honoured and happy with the fact that I had the experience to be the task leader of the ECA performance audit on passenger rights. This task was in several ways a performance audit out of the ordinary. We deliberately decided to use an innovative approach and also took care that our work resulted in a straightforward and reader-friendly report (special report 30/2018 published in November 2018). All of this would not have been possible without a highly motivated and dedicated team.

My three favourite findings

Our audit on passenger rights revealed several interesting findings. I will not list all them, as this may take away your appetite for reading the report itself, but I want to focus on those three that I am the most passionate about:

  • The EU passenger rights have become all about compensations: There are altogether 10 rights that we as passengers enjoy. They span from the right to information to the right for snacks and accommodation in case our travel is disrupted. These rights are basically similar for air, rail, bus and waterborne travel. Sounds good, doesn’t it? Well, in fact, some 95% of the attention in this field is focussed on air passenger rights, more precisely on the issue of compensations payable due to long delays or cancellations. This topic has all but paralysed the passenger rights framework;
  • The system of handling passenger claims lacks transparency: Our survey of more than 10 000 people revealed that the right for compensation is the second most highly valued of the 10 passenger rights. Therefore, it was really surprising to find that no information whatsoever is available on this for passengers: there are for example no statistics available on the number of claims made by passengers or which departures are deemed to be subject for compensations. Nothing prevents an airline from paying compensation to one passenger with a well-written request and ignoring another passenger affected by the same travel disruption. No wonder this situation has created a brand new industry of passenger rights case handlers;
  • There are in reality more than 100 different systems of passenger rights in the EU-28. There are four EU regulations setting the passenger rights in four transport modes. Well, not one but four. Still bearable, although from a passenger perspective it would be beneficial if these rights were broadly similar and, as far as possible, aligned on each other. Moreover, the way these rights are implemented depend to a large extent on the arrangements set out by each Member State. In some cases, like bus or rail travel, within one country even regional authorities might come into play. Overall, we have more than 100 individual implementation arrangements all over Europe. This is creating unnecessary administrative complexity for both passengers and carriers.

All these findings were a result of significant research and fact-finding on the ground. We visited 10 Member States, had altogether 80 meetings with the national authorities, carriers, case handlers and consumer protection officers. The spirit of cooperation from our partners was amazing — everyone really wanted to share their view with the hope that something could eventually change in the current set-up.

A typical policy audit: it’s all about regulation

We had access to these people despite the fact that the EU has spent less than 1 million euro on passenger rights in the current MFF. The socio-economic impact of this policy does not come from spending, but from regulation. This fact makes this audit a typical policy audit. An approach which is not yet very common in our work.

But we also saw the limits of our audit in terms of triggering actual change on the ground. In the end there are many stakeholders involved and many interests at stake, and the conclusions and recommendations in our reports, despite being well grounded, are just some among many.

Delivering criticism but also offering solutions

Another aspect that makes this audit report stands out from others are the recommendations. We went much further from the more commonly used recommendation ‘the Commission should analyse and find best practices level’ and aimed at proposing concrete solutions that would break the current impasse of the passenger rights legal framework. I would like to highlight three proposals in the report that would benefit everyone:

  • There should be a specific definition for the carriers’ obligation to provide assistance and care. The current passenger rights system sets no minimum conditions to the amount of care you are entitled to in a case of travel disruption. Getting a 3-euro food coupon in a case of 6 hours delay that can only be used in one cafeteria in the whole airport, where a coffee costs 5 euro is not adequate. The report proposes setting a 40 euro minimum threshold for air travel and 20 euro for other modes of transport so that people would be looked after when the pain is the most acute;
  • In the current system compensations are only paid at a request of each and every passenger. At the same time, the system of claims handling is non-transparent both at the carrier side and also when government bodies step in to mediate. The audit proposes a 48 hour deadline for the carriers to self-declare the causes of the delay and cancellation, thus making it known to all parties involved. These declarations could become the subjects of an assessment by the consumer protection authorities. And, if the carriers declare that the reason for delay was indeed under their control, we invited them to execute automatic payments of compensation for the affected passengers. This would significantly reduce the costs of case handling, court cases and the overall trouble for all parties;
  • The amounts for the compensation to be paid currently vary between the mode of transport. In rail, bus and water transport, they are related to the cost of a ticket while in the air travel specific amounts were laid into the regulation. The regulation comes from 2004 and according to our calculations by now some 25% of the value of these compensation have inflated away. We propose introducing a system that would ensure that the purchasing value of the compensations would remain stable over the years.

In short, these changes would make the system of passenger rights more transparent, less bureaucratic and fairer for all parties involved: passengers, carriers and public sector authorities. But also much more expansive. And this is probably why nothing of this kind will happen soon.

Not only recommendations but also tips for travellers…

Based on the contacts the ECA auditors had with carriers, public authorities and ordinary passengers, they put together 10 tips to make anyone’s travel experience better if their journey is disrupted:

1. Personalise your travel as much as possible — when purchasing a ticket, identify yourself to the carrier, e.g. provide your contact details. Being informed about disruptions only works when carriers have your contact details. Also, if you need claim for compensation, a personalised ticket is the best way of demonstrating that you were actually on board and affected by disruption.

2. Take a photo of your luggage — when your journey involves checking in luggage, it is a good idea to have a photo of your suitcase and its contents. This will save time when filing a claim and will provide some proof of the value of lost items.

3. Don’t arrive late at the check-in desk — it is important to remember that passenger rights only apply if you check in on time. If you miss your departure because the check-in desk was already closed when you arrived, you are not eligible for assistance.

4. Request information at the points of departure — you have a right to be updated if your departure is delayed, or if anything else goes wrong with your journey. If the carrier’s representative is not present or does not provide meaningful information, make a note of it and include this observation in the claim you make to the carrier.

5. Always request assistance — if you experience a long delay or cancellation on any mode of transport, you have a right to assistance. This means access to water and a snack or a meal. If the carrier’s representatives do not provide such amenities on their own initiative, request them. If you are refused, make a note of it and include this observation in the claim you make to the carrier.

6. Keep all receipts — if assistance is not provided at the point of departure (airport, bus or train station, harbour) or you are departing from a remote location (a bus stop) you can ask the carrier to compensate your additional costs. Carriers usually request proof of payment for drinks and snacks, and may refuse if the number of items is not in line with the length of delay, or if the costs are unreasonably high. Similar principles apply if you have to find your own accommodation to wait for another departure the following day.

7. Request proof of delay or cancellation — in all four modes of transport, passengers are entitled to compensation for long delays and cancellations. Although the rate of compensation and the minimum waiting times are different between the modes, the obligation to prove that you were affected is the same for all. If your ticket did not have your name on it, obtain proof at the station or on board that you were affected by the specific delay or cancellation.

8. Do not make your own arrangements without hearing first a proposal from the carrier — with travel disruption you usually want to continue travelling immediately using another carrier or by another means of transport. We recommend not to act rashly: buying a new ticket, without receiving alternative options proposed by the carrier, is tantamount to unilaterally cancelling your contract of carriage. This ends any obligation of the original carrier to offer you assistance or compensation.

9. Request for compensation — if you can demonstrate that you have been affected by a delayed or cancelled departure, and that the duration of the delay was above the threshold set out in the regulation, submit a compensation request to the carrier. Always refer to the specific departure and the Regulation applicable. If you do not receive a reply from the carrier or you are not satisfied with it, refer the case to the National Enforcement Body of the country of departure. The other organisations that can help you are Alternative Dispute Bodies (ADRs) and claim agencies. Bear in mind that you may be charged for these services.

10. Request compensation for additional expenditure — in some cases your loss due to a delay or cancellation is much greater than the amount due to you under EU passenger-rights compensation rules. In such cases, you can make a claim to the carriers pursuant to international conventions. You should be prepared to demonstrate the exact amount of your losses, and the extra expenditure incurred due to the travel disruption.

Report published…and now what?

As standard practice, at the ECA, we publish our audit reports together with a press release. In some cases, we also organise a press briefing or specific events where the report is presented to stakeholders. We also present our reports at the European Parliament, in its Budgetary Control Committee (CONT) and more and more often at a committee specialised on the topic. Normally there is also a presentation at the Council working group on the issue.

Our special report on passenger rights has gone through all these steps. We attracted quite some media coverage, presented the report at the European Parliament and had an interesting meeting at the Council. The report was praised for its quality and we were thanked for the interesting recommendations. But so far there seems to be no intention to modernise the EU passenger rights legal framework.

When we are aiming for policy audits the issue of recommendations is very important to clarify. Usually, all parties involved agree with our analysis of the situation. Our reports are recognised as a valuable source of information for the Commission and other auditees, if applicable, because we are seen to be independent and impartial. But this does not mean that someone would act upon our reports. I have sometimes felt in Brussels like a brave crusader returning from long trips to foreign lands, packed with information about how life is playing out over there.

In the case of an audit of a specific spending area, our recommendations most often focus on the systems, the extent to which EU and national rules have been complied with and specific choices made by those managing EU funds. Implementing these recommendations helps to avoid making similar mistakes again or to recoup funds wrongly spent. In a case of policy audits, we propose changes to the rules themselves and such recommendations are actually subject to a completely different decision making process, and a more long-term political horizon. And this is where our mandate ends.

More targeted communication efforts may be required to rally public support behind our suggestions

Policy audits, especially on topics that matter to people and could potentially improve the way the EU influences our everyday lives, are here to stay. Common sense tells us that topics such as EU passenger rights are important are in need for an independent external examination. And who would be better positioned than the ECA to do this? This idea of the ECA also being a ‘regulatory watchdog’ — as recently stated in the ‘Politico’ — underlies the ECA strategy for the 2018–2020 period.

But how to get more punch from our recommendations? As external auditors, we need to understand that if we want our policy audits to make a difference, we need to get under the skin of the decision makers. And we probably need to advocate more convincingly and clearly that decision-makers need to take action if they really want to address the shortcomings that we have pointed at in our reports. This may also require more targeted communication efforts than we currently deploy, rallying public opinion behind our suggestions for improving EU policies. Only then will our policy audits have the impact they deserve.

This article was first published on the January-February 2019 issue of the ECA Journal. The contents of the interviews and the articles are the sole responsibility of the interviewees and authors and do not necessarily reflect the opinion of the European Court of Auditors.

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The ECA Journal features articles on a variety of current audit topics, the ECA’s role and work. It is available in electronic form below, and paper copies can be ordered online at the EU Bookshop.

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