The Labor government will not introduce a European Union-style scheme to compensate airline passengers for disruptions and delays despite public outcry and calls from the competition regulator after chronic poor performance by Qantas last year.

European airlines must compensate passengers when their flight is delayed or cancelled, or if they were denied boarding, if they reach their final destination more than three hours later than scheduled.

Luke Grant chats with Frequent Flyer Editor Matt Graham about how successful the European model has been and the inefficiencies of Transport Minister Catherine King's proposal to implement an ombudsman who has powers to force airlines and airports to follow their own terms and conditions, particularly relating to refunds.