Labour will stop companies charging loyal customers more, put an end to misleading discounts, and make sure companies treat their customers fairly.
- No loyalty penalty: phone and insurance companies can't charge longstanding customers higher prices than new customers for the same service without good reason
- Easier switching: unfair exit fees, excessive notice periods and unclear automatic renewals banned
- No nasty surprises when deals end: power and phone companies can't automatically move customers onto unjustifiably expensive plans, and must say clearly what you'll pay and whether a cheaper equivalent plan exists
- Fake discounts a specific offence under the Fair Trading Act
- 30-day rule: advertised discounts must be based on the lowest price charged for that product in the previous 30 days, with limited exceptions
- Shops must keep price records so their claims can be checked
- Part of Labour's Action on Bills plan to bring down everyday costs
You shouldn't have to spend hours comparing prices, reading the fine print or changing companies just to get the best deal. But too often, that's exactly what happens.
You stay with the same company for years and end up paying more than a new customer. You sign up for a good deal, only to find your bill has gone up when the offer ends. Or you buy something on sale, only to discover the saving wasn't as good as you thought it was.
Labour will introduce new rules to stop companies charging loyal customers more, put an end to misleading discounts, and make sure companies treat their customers fairly. It's the next step in our Action on Bills plan to bring down everyday costs for Kiwis.
1. Stop companies charging loyal customers more
Some companies save their best deals for new customers, while people who've been with them for years pay more. It doesn't make sense.
Power companies are already required to regularly check whether their customers are on the best plan. Labour will go further so others like phone and insurance companies can't charge longstanding customers higher prices than new customers for the same service without good reason.
We'll also make it easier to change providers and ban unfair exit fees, excessive notice periods and unclear automatic renewals that lock customers in and make switching hard.
Companies will still be able to offer genuine deals and charge different prices where there are good reasons, such as differences in usage, risk or service. But they won't be able to charge you more just because they think you won't leave.
2. No nasty surprises when deals end
A cheaper phone or power plan can look like a great deal. Then the offer ends, the price goes up, and you're left paying more than you expected.
Labour will change the rules so power and phone companies can't automatically move customers onto unjustifiably expensive plans when introductory deals end.
Companies will have to tell you clearly what you'll pay when your deal ends, and let you know if there's a cheaper equivalent plan you could switch to.
3. Ban fake discounts
If a shop says something is discounted, it should be a real saving.
Some shops put prices up just before a sale, then bring them down again to make the discount look bigger. People think they're getting a bargain when they're not.
Labour will make fake discounts a specific offence under the Fair Trading Act. Under the new rules, shops will have to:
- Base advertised discounts on the lowest price they charged for that product in the previous 30 days, with limited exceptions
- Stop inflating the original price to make a discount look bigger
- Keep records of their prices so their claims can be checked
When you see something on sale, you should be able to trust that you're getting a genuine saving.
| The problem | What Labour will do |
|---|---|
| Loyal customers pay more than new ones | Stop phone and insurance companies charging longstanding customers more for the same service without good reason; ban unfair exit fees, excessive notice periods and unclear automatic renewals |
| Prices jump when introductory deals end | Stop power and phone companies automatically moving customers onto unjustifiably expensive plans; require clear information on what you'll pay and any cheaper equivalent plan |
| Discounts that aren't real | Make fake discounts a specific offence under the Fair Trading Act, based on the lowest price in the previous 30 days |
Part of Labour's plan to bring down everyday bills
When you're working hard, every dollar counts. And it's frustrating how quickly the bills and little extra charges add up.
Labour will take on the costs people can't avoid - groceries, power, transport and healthcare - and stop companies taking advantage of people with unfair charges.
Our Action on Bills plan includes practical changes that will make a difference to the bills you face every week:
- Making price gouging illegal, so big companies can't charge excessive prices for essentials like groceries, power and fuel. Companies caught overcharging will have to pay customers back
- Banning hidden fees, so the price you see is the price you pay, with no nasty surprises at the checkout
- Stopping subscription traps, making it as easy to cancel a gym membership or streaming subscription as it was to sign up
- Taking on the big supermarket chains, so smaller stores can compete and Kiwis get more choice and fairer prices
- Helping bring down power bills with SolarSaver, so families can get solar panels without the upfront cost
- Making transport cheaper by freezing fuel tax for three years and capping public transport fares at $20 a week in Auckland, Wellington and Christchurch, and $10 elsewhere
What is Labour's crackdown on unfair charges on bills?
Labour will introduce new rules to stop companies charging loyal customers more, put an end to misleading discounts, and make sure companies treat their customers fairly. It is the next step in Labour's Action on Bills plan to bring down everyday costs for Kiwis.
Will Labour stop companies charging loyal customers more?
Yes. Power companies are already required to regularly check whether their customers are on the best plan. Labour will go further so others, like phone and insurance companies, can't charge longstanding customers higher prices than new customers for the same service without good reason.
Will companies still be able to offer deals?
Yes. Companies will still be able to offer genuine deals and charge different prices where there are good reasons, such as differences in usage, risk or service. But they won't be able to charge you more just because they think you won't leave.
What will Labour do about exit fees and automatic renewals?
Labour will make it easier to change providers and ban unfair exit fees, excessive notice periods and unclear automatic renewals that lock customers in and make switching hard.
What happens when an introductory deal ends?
Labour will change the rules so power and phone companies can't automatically move customers onto unjustifiably expensive plans when introductory deals end. Companies will have to tell customers clearly what they will pay when the deal ends, and let them know if there is a cheaper equivalent plan they could switch to.
How will Labour ban fake discounts?
Labour will make fake discounts a specific offence under the Fair Trading Act. Some shops put prices up just before a sale, then bring them down again to make the discount look bigger, so people think they are getting a bargain when they are not.
What rules will shops have to follow on discounts?
Under the new rules, shops will have to base advertised discounts on the lowest price they charged for that product in the previous 30 days, with limited exceptions; stop inflating the original price to make a discount look bigger; and keep records of their prices so their claims can be checked.
What is Labour's Action on Bills plan?
Labour's Action on Bills plan takes on the costs people can't avoid - groceries, power, transport and healthcare - and stops companies taking advantage of people with unfair charges. It includes making price gouging illegal, banning hidden fees, stopping subscription traps, taking on the big supermarket chains, SolarSaver, freezing fuel tax for three years, and capping public transport fares at $20 a week in Auckland, Wellington and Christchurch, and $10 elsewhere.
You work hard for your money. You deserve fair prices, honest deals and more left over at the end of the week.
Better starts now.
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