ACCC chair Gina Cass-Gottlieb said the disruption “left customers with less time to make alternative arrangements and may have led them to paying higher prices to fly at a particular time”.

Treasurer Jim Chalmers said the allegations against Qantas were “deeply concerning”.

“This is the consumer watchdog doing its job and a reminder that businesses need to do the right thing by people,” he said. “Breaches of consumer law carry heavy penalties.”

Chalmers said the federal government’scompetition review would canvass the aviation sector,despite comments from Assistant Competition Minister Andrew Leigh this week that confirmed aviation would not be included in the review,but in a green paper.

Sydney Airport boss Geoff Culbert and Australian Airports Association chief executive James Goodwin said the ACCC’s allegations prove that Qantas had been hoarding slots toprevent access to other carriers,and called for the reinstatement of the ACCC’s airline monitoring report.

“Slots are owned by Australian taxpayers,and they should be used to benefit the public,not incumbent airlines,” Culbert said.

Qantas said it would examine the ACCC allegations and respond in full to them in court. The groupreported a $2.47 billion record profit last week,but its share price has fallen by almost 10 per cent to $5.91 this month.

“It’s important to note that the period examined by the ACCC was a time of unprecedented upheaval for the entire airline industry. All airlines were experiencing well-publicised issues from a very challenging restart,with ongoing border uncertainty,industry-wide staff shortages and fleet availability causing a lot of disruption,” the airline said.

Meanwhile,Qantas’ concession on flight credits follows intense public pressure,whichculminated at a frosty Senate hearing into the cost of living on Monday and a letter from the ACCC,which expressed “strong concerns” with the carrier’s planned December expiry date for the refunds.

The business accrued $2 billion worth of cancelled flights across Qantas,Jetstar and overseas based bookings due to lockdowns to October 2021.

Qantas confirmed on Thursday there was now $570 million yet to be returned to affected customers across the three arms of the business,after ahostile exchange with senator Tony Sheldon on Monday. Almost $365 million belongs to Qantas customers in Australia,$90 million belongs to Jetstar customers in Australia and $115 million belongs to overseas customers. About $180 million are bookings made through travel agents.

Qantas is already facing a class action on behalf of disrupted passengers who allege they were unable to be compensated for their cancelled flights.

The airline confirmed on Thursday it would contact all affected passengers to alert them of the new COVID-19 flight credit policy,which will come into effect from September 4.

Outgoing Qantas boss Alan Joyce said the airline had scrapped the expiry date in the hope customers’ faith in the airline would be restored.

“We know the credit system was not as smooth as it should have been. And while we’ve improved it recently and extended the expiry date several times,people lost faith in the process. We hope this helps change that,” Joyce said.

The airline is also offering a deal to double frequent flyer points as a way to encourage passengers to consider booking another flight instead of demanding a cash refund.

Prime Minister Anthony Albanese said the ACCC was doing its job,which “is to look after consumers”.

“Something I called for in recent days,of Qantas recognising the need to look after those people who had made bookings for flights that have been cancelled,[is] to not have those credits expire and to be able to receive either a refund or a use of their flights,” Albanese said.

This is the fourth time Qantas has amended its COVID-19 refund and flight credit policy,in an attempt to lower the multibillion-dollar credit balance it accrued over the period.

Passengers were previously eligible for a refund until December 2023. Those who already obtained flight credits from the company still have until the end of this year to book a flight.

Customers who booked flights through a travel agent can also get a refund,while those with a flight credit from Jetstar will also be able to use them indefinitely.

Qantas’ biggest rival,Virgin Australia,has around $100 million in COVID-19 credits yet to be used,down from a total sum of $1.2 billion accrued between September 2020 and July 2022.

Virgin’s COVID-19 credits require passengers to book and travel by the end of December 2023. However,Virgin has also issued credits to travellers who were disrupted due to the carrier’s stint in administration. These “Future Flight” credits are subject to the airline’s standard credits policy,which means only a certain number of seats on any flight can be booked by those trying to use them.

Regional Express,Australia’s third domestic carrier with about 5 per cent of the market,has refunded all passengers affected by cancellations over the lockdown period.

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