The Travel Association today responds to the Department for Transport’s announcement on reform of the ATOL scheme of financial protection. In its announcement today, the DfT outlined a series of reforms that will be introduced effective from 30th April 2012, key among them a new concept that will see ‘Flight Plus’ holidays receive the same financial protection as flight-based package holidays through the ATOL scheme. A ‘Flight Plus’ holiday is when a customer buys a flight and accommodation and/or car hire, together (either on the same day as the flight, the day before or the day after) from the same travel company.
ABTA welcomes the inclusion of ‘Flight Plus’ holidays into the ATOL scheme as well as other key developments announced by the Government today:
Confirmation that the introduction of ATOL Certificates will be put back to 1st October 2012, a move that ABTA has called for to give travel businesses time to adapt to the changes.
Confirmation that business travel sales to corporate entities will be exempt from the scheme.
The inclusion of microbusinesses within the scheme, enabling them to provide full consumer protection.
Recognition by the Government that the system will remain confusing if holidays sold by airlines are not brought in and that it will seek the power to do this as part of the Civil Aviation Bill currently going through parliament.
The Government expects six million more holidays to be brought into financial protection as a result of the reforms; however ABTA notes that around 44 per cent of the holiday market will still remain unprotected as holiday sales by airlines are not within the scope of the scheme.
Mark Tanzer, ABTA Chief Executive said:
“ABTA has long called for reform of the ATOL scheme of financial protection to ensure that it provides greater protection and transparency for consumers. We believe all holidays, however they are booked, should be financially protected. The package of reforms announced today – most notably the extension of protection to include ‘Flight Plus’ holidays - mark a significant first step to improving a system that is outdated, unfair and confusing; we consider the inclusion of holidays sold by airlines an essential second step. While we are pleased the Government acknowledged the need to include these today, we urge them to act swiftly to introduce the necessary legislation to make this happen.”
In the last year ABTA has conducted its biggest ever consultation process with Members, the DfT and CAA and we are pleased that the Government has listened to industry concerns by exempting business travel, including microbusinesses and delaying the introduction of ATOL Certificates until later in the year. The administrative demands of the reforms on UK travel businesses are considerable so a phased approach makes sense, not least when important details such as bonding levels have still to be ironed out.”