ABTA responds to Department for Transport’s ATOL reform proposals

ABTA responds to Department for Transport’s ATOL reform proposals

The ABTA Board has approved the submission after the biggest ever consultation process undertaken by the Association.  Meetings were held in each of the 11 regions across the UK, we received the largest ever response from a Member questionnaire and meetings were conducted with a group of Member representatives from across the industry.

In its response to Government, ABTA sets out the following:

ABTA has long called for reform of the ATOL scheme as in its current form it is unfair and unclear, which is confusing for consumers and damaging for the industry.  ABTA believes all holidays, however they are booked, should be financially protected. Comprehensive, transparent and clear consumer protection is the goal.
*  ABTA supports the current proposals as a first step towards improving the current system of consumer financial protection.  ABTA considers the inclusion of airlines as an essential second step.
*  ABTA calls on the Government to make an explicit commitment to increase the scope of protection by including holidays sold by airlines within the ATOL scheme. An overwhelming 95 per cent of respondents to ABTA’s consultation questionnaire agreed that airlines should be included in ATOL.*
*  ABTA is supportive of the concept of Flight Plus as a step towards an expanded system of consumer financial protection for holidays, but it has concerns about the current proposals.  These include the current lack of definition regarding the protection to be offered by the Air Travel Trust Fund, and hence the backup insurance requirements for Flight-Plus arrangers; the mechanism for implementing the ATOL Certificate; and the bonding requirements for new ATOL licensees.
*  ABTA has serious concerns that the Government’s timetable for the implementation of the new system in January 2012 may endanger the quality and effectiveness of the reforms, as well as placing travel businesses under unnecessary and undue pressure.
*  During the consultation, ABTA has been in regular dialogue with the Department for Transport and Civil Aviation Authority, seeking on behalf of Members to clarify critical elements regarding the principles and practicalities of the reforms.  There are still many important questions unanswered and ABTA has requested an opportunity for a formal reply on the outcome of deliberations by the Air Travel Trustees on fundamental aspects of how the scheme will work.

Mark Tanzer, ABTA Chief Executive said: “ATOL reform is such an important issue for our industry and we’ve had a very diverse range of views coming through from our Members on the Government’s proposals.  We have listened to what our Members have told us – in support of and against the proposals - and this feedback has been critical in shaping the ABTA response.

ABTA has long called for reform of ATOL as we believe all holidays, however they are booked, should be financially protected.  We support the current proposals as a first step towards creating a more comprehensive, clear and transparent system of consumer protection.  We consider the inclusion of holidays sold by airlines as an essential second step and call on the Government to make an explicit commitment to this.

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We remain very concerned about some of the practical issues involved in the introduction of key elements of the proposals such as the definition of the protection to be offered by the Air Travel Trust Fund and the mechanism for implementing the ATOL Certificate.  We want a workable solution, not just a quick solution, and believe that the current timetable of January 1st may endanger the quality of the reforms.”

ABTA’s full submission is available at www.abta.com/atolreform.

*Every ABTA Member received a copy of a comprehensive Questionnaire and was given four weeks to return the questionnaire or complete an online version. 225 ABTA Members responded by the deadline of 18 August.