Suspend refund rules or risk UK travel industry meltdown, warns Abta


Abta has demanded the government suspend the travel industry’s refund rules, or face “catastrophic damage to the UK travel industry, and widespread consumer detriment”.

The travel industry body said that while other European countries have all changed EU refund rules, the UK government’s lack of action will send many good travel businesses over the edge.

Hundreds of thousands of holidays have had to be cancelled in recent weeks, but Abta said tour operators do not have the money to refund customers within the existing 14-day time period.

In recent days the Guardian has been inundated by holidaymakers complaining that they can’t get a refund from their tour operator after their trip was cancelled. Some have spent in excess of £10,000, but instead of a refund, they are only being offered an unwanted change of dates.

Abta chief executive Mark Tanzer has called on the government to allow firms four months to process payments.

“The global pandemic has put enormous financial strain on tour operators and travel agents on a scale that is unmanageable in the short term. These businesses are themselves waiting for refunds from hotels and airlines and without this money, they simply do not have the cash to provide refunds to customers. We want to avoid the scenario of normally successful travel businesses employing tens of thousands of people facing bankruptcy.

“We are proposing some simple, temporary changes to regulations to buy more time for companies to keep trading, while ensuring customer rights are protected. Many European countries, including France, Belgium, Denmark and Italy, have already announced similar regulatory changes to preserve their travel industries and protect customers,” he said.

READ  Paddy Power raises earnings expectations after US gamblers splash out in October
Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk

He also called on the government to take strong enforcement action against the airlines which have flouted the law by withholding refunds following the cancellation of flights.

A widespread collapse in travel firms would leave affected passengers having to apply to the Atol compensation scheme that is still recovering from Thomas Cook’s collapse.

The National Audit Office warned earlier this month that the government would have to pick up the bill for any future collapses. More than £480m was paid out to repatriate and refund holidaymakers hit by the Thomas Cook collapse.



READ SOURCE

LEAVE A REPLY

Please enter your comment!
Please enter your name here