Merricks and Light on the Horizon
For longer than I care to remember, CD-Traveller has covered complaints, suggestions, conversations and proposals about reform the bonding system we have in place to help those who, through no fault of their own, are left in the wet and sticky when their tour operator or holiday company goes bust. The help you receive depends on how your package was booked and you may not even be aware of how the supplier or travel agent has put it together.
Now the CAA (who administer the ATOL scheme) has published the results of an independent review but it covers only claims handling. The reform proposals are not due to appear until much later in the year when some of the recommendations from this report will be included. The consultation period ended in early August last year. It has taken 9 months to give birth to just a 20 page document with an additional 31 pages of appendices! Am I being churlish especially as the author, Walter Merricks, admits the delay saying it was due to three more collapses last summer (Goldtrail, Sun4U and Flight Options/Kiss) and awaiting the government’s consultation on ATOL reform?
Yes I am because this report has deadlines and all should be in place for the start of the summer season next year.
Let’s skip to the nitty gritty. Merricks says that the legal framework of the ATOL scheme is outdated, some travel firms produce a poor standard of documents and, the system can’t handle the sheer volume of complaints that arose over the biggest collapse, XL and strict payment policies seem to exacerbate the situation. That payment to XL customers took over 3 months to settle in some cases, he suggests is wrong.
There are two features I would highlight. He suggests copying the insurance industry and paying out first and then seeking repayment from other parties later and that, if your company goes bust, the money you have paid could be used by a travel agent to buy another holiday, the travel agent being secure in the knowledge that the money would come from the bonding scheme.
The report comes just after a Travelsupermarket.com survey came out showing that only 14% of the 2,000 responders said that travel protection was important. That’s because we haven’t had a crash for a few months. Just because the great British public responders to this survey have forgotten the problems, the authorities shouldn’t. Anything to speed up and introduce wider protection to all travellers should be supported.