CAA Calls For Legislation To Extend Travel Protection

20th Jul 2004

The Civil Aviation Authority today advised the Government that the UK should introduce urgent legislation to restore the extent of financial protection for holidaymakers and leisure travellers. This would involve broadening the current requirements that apply to tour operators to include flights sold direct by airlines, and also to accommodation provided through Internet sites linked to those of airlines.

The CAA’s Advice to Government on Financial Protection for Air Travellers and Package Holidaymakers in the Future said that sharp reductions in the scope of holiday protection had meant that a substantial and growing number of leisure travellers were at risk of financial loss or being stranded abroad.

UK air travellers have comprehensive financial protection under ATOL for flights and packages bought from tour operators, but increasingly customers are buying direct from airlines and hotel suppliers over the Internet so that no protection exists.

In 2003, 12 million ex-UK leisure flights and holidays carried no protection, and the coverage of ATOL has declined from 98 per cent of leisure travellers in 1997 to 70 per cent in 2003. CAA research shows that the public is largely unaware of the lack of protection when they buy separate holiday items, or believe that they are protected by travel insurance. Most travel insurance policies do not cover airline insolvency.

The CAA’s advice follows a widespread consultation in July 2003 and the publication of draft advice for comment in March 2004. Its advice has now been presented formally to the Secretary of State for Transport.


Helen Simpson, Director of the CAA’s Consumer Protection Group, said: “The ATOL system has served the public well over a long period, but the way holidays are sold has changed and it can’t now provide what people want and expect.

“The current legislation was introduced over 30 years ago, when scheduled airlines were often state owned and less likely to collapse. They now operate in a highly competitive market and some failures are inevitable. As a result there are real risks to the public which they do not understand.”

The CAA has also advised that in view of the time that may be required to introduce new legislation, the Government should consider interim measures that could be implemented by airlines on a voluntary basis, such as arranging for their packages to be sold through an ATOL holder and selling improved insurance which covers airline failure.

has welcomed wholeheartedly the recommendations made by the CAA to the Government to extend travel protection to flights sold direct by airlines and accommodation provided through internet sites linked to those airlines. With more and more scheduled airlines selling direct, leisure travellers and holidaymakers do not realise that they are not always financially protected by the existing travel protection schemes.

Ian Reynolds, ABTA Chief Executive said: “This is good news indeed! ABTA has been concerned by the growing financial protection gap and is joining the call for Government to introduce new legislation urgently.” 


The Federation of Tour Operators (FTO) has also welcomed the CAA’s recommendations. 

Commenting Andrew Cooper,  Director General, FTO said, “Action to protect

customers of all UK-originating international flights paid in advance is

long overdue.  We urge the government to commit to the earliest possible

timeframe for legislative action,  and to add their weight to the CAA’s

recommendations for effective interim protection for travellers.  It is not

an option to delay or to act only after some new major financial collapse.

British citizens need and deserve proper protection now.”



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