Commit to a lemon car ombudsman in November election, say consumer advocates

                                             
Consumer Action Law Centre and WestJustice Western Community Legal Centre are calling on the Victorian Government to make a solid commitment, ahead of the upcoming Victorian election in November, to implement a lemon car ombudsman in 2023.

“It’s a shocking fact that every year thousands of Victorian families and livelihoods are shattered because we don’t have a fast, accessible and affordable way to resolve lemon car disputes,” said Tania Clarke, Director of Policy and Campaigns, Consumer Action Law Centre.

“We rely on our cars for daily life: to get to work, school, health appointments and the shops. Cars can be a crucial part of a safety plan – a way to flee family violence or to evacuate during bushfires and extreme weather events. In Victoria’s regional, rural and outer metro areas that lack public transport, including our rural Koori communities, cars are essential.

“The way to help families quickly is with a dedicated ombudsman for motor vehicles who can help get Victorians on the move,” said Ms Clarke.

Approximately 25-30% of calls to Consumer Action’s legal advice lines about consumer guarantees relate to defective cars and Consumer Affairs Victoria receives more than 3000 vehicle consumer guarantee complaints per year.ⁱ We also know that many people give up when they can’t reach a resolution with their car dealer – which means we are likely only aware of a small proportion of the people actually burdened with a lemon car.

Ombudsman schemes already exist for utilities providers, telcos, lenders, and insurers. Car dealers are licenced by the Government so it is an easy step to ensure they participate in an ombudsman service that will enhance trust in the sector.

“We have written to the Victorian Government to urge them to commit to an ombudsman scheme for motor vehicles that is accessible, affordable and timely,” said Ms Clarke.

“A progressive user-pays funding model, like other ombudsman schemes, would incentivise car dealers to resolve complaints quickly, and rewards car dealers that don’t create consumer problems in the first place,” she added.

“Right now, communities in Melbourne’s Outer West are penalised over and over again if they buy a car and something goes wrong,” said Melissa Hardham, CEO of WEstjustice.

“If you can’t access remedies in a timely and fair way to get your car working again, or access an appropriate refund, then it leads to compounding transport poverty. People who have to wait months or years for an outcome at VCAT are people who can’t get to work, training, or essential health and community services during that time.

“We need a better and faster pathway for these disputes,” she said.

The Australian Consumer Law guarantees that we have a right to safe, durable, and fit-for-purpose car that is free from major and minor failures. But far too often, Victorians sold a lemon car simply cannot enforce these rights because accessing justice through the Victorian Civil and Administrative Tribunal (VCAT) is expensive, slow, and inaccessible without a lawyer.

 
ⁱProductivity Commission, Inquiry into the Right to Repair ‘Draft Report’ (2021) 94, available at:
https://www.pc.gov.au/inquiries/current/repair/draft; data provided by Consumer Affairs Victoria.