An estimated six million additional Holidaymakers will be protected by the new air traveL organisers’ Licensing (ATOL) rules if their tour operator fails, but the reforms are insufficient and need to be revised, claim traveling experts. Thais Parvez reports.
If you thought losing your passport or finding dirty accommodation was the worst of your travelling nightmares, think again. New ATOL reforms may give you another headache even before you book the holiday itself. It is vital to understand the new rules to avoid nasty surprises when buying that dream summer vacation.
The Air Travel Organiser’s Licensing, managed by the Civil Aviation Authority (CAA), came to force in the 1970s as a financial protection scheme to refund holidaymakers purchasing ‘traditional packages’ against the risk of travel firms becoming insolvent. The scheme covered the vast majority of holiday bookings in the past, protecting 18 million people every year, but nowadays coverage has fallen under 50%, and the future does not look any brighter.
Everyday more and more holidaymakers are putting their own holidays together via the internet and over the telephone either booking directly with suppliers or using intermediates. In many cases it is difficult to establish whether or not the traveller has bought an ATOL protected package.
In April the Government announced a new reform of the scheme which will be applied fully from October and benefits an estimated six million additional passengers. Changes will be applied to ‘flight-plus packages’, bookings that combine flights and hotels. The new legislation will require companies to give consumers a certificate when buying a holiday package or a flight. Therefore in the event of failure, the CAA will make sure that customers who paid and established a contract with an ATOL holder do not lose money or end up stranded abroad.
However, some traveling experts and members of the Transport Select Committee believe that the Government’s proposed revision to ATOL is “not enough” and consumers are still confused about what kind of protection they have when booking their holidays.
Commenting on the official report, committee chair Louise Ellman MP, said: “We welcome the changes to ATOL. Flight Plus will extend financial protection to millions of people who put together their own travel packages with travel agents, mainly over the internet. New ATOL certificates to be issued with holiday bookings should provide greater clarity for holidaymakers.
“But other aspects of ATOL remain unsatisfactory. The Government does not have a plan for comprehensive reform. There is no clarity about protection for passengers who book a flight only and the charges are unfair to some consumers and to sections of the travel industry. The Air Travel Trust Fund that backs the scheme is £42 million in deficit.”
The reforms represent a step forward in holiday consumer protection but some believe that the information can be unclear for passengers. Under new rules most flight-only bookings remain unprotected and if a passenger wants to enjoy adequate protection when booking accommodation and/or hiring a car, he must be sure to do it the same day or within a day of reserving a plane ticket with a travel agent that is an ATOL holder.
Another concern is that holiday sales by airlines or some types of travel agent remain outside the scheme. Coverage varies depending on the company, not everyone inside the travel industry is obliged to hold an ATOL licence and pay the £2.50 protection contribution per passenger. MP Louise Ellman considers ATOL Protection Contributions should be linked to the value of the holiday instead of the current fixed rate. She also recommends both the CAA and the Government developing a new code of practice covering relevant information for holidaymakers to make sure they understand where and how the new ATOL scheme works. Travel Trade Consultancy founder Matt Purser, an experienced consultant who had a 15-year career at the CAA and over 30 years’ experience in the travel sector, welcomes the new reform but confirms the scheme is still far from perfect. He says: “Given the cost and the iconic importance of the annual summer holiday in the British psyche, the additional clarity has to be a good thing for the consumer.”
Undoubtedly the introduction of the new reform is something many holidaymakers will celebrate, but a lot of passengers will still be left outside of ATOL protection. Even though the Government proposed to bring holidays sold by airlines into the scheme, they would need to pass new legislation and that means the protection holidaymakers deserve and have always dreamt of will not come true until 2014 at the earliest.
Make sure your holiday is protected
Book a package holiday or ‘Flight Plus’ with a travel agent or tour operator. Ask your agent to explain what protection you will receive and check your holiday documentation to ensure all elements of the holiday are protected.
(From October) make sure when buying an ATOL protected holiday package you receive a paper copy or email of ATOL’s certificate.
‘Flight Plus’ – If you arrange your own holiday, when booking accommodation and/or hiring a vehicle, make sure you do it the same day of or within a day of reserving your plane ticket with a travel agent that is an ATOL holder, and purchase it from the same company and in one transaction.
