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‘Failing airlines put passengers at risk’

Scheduled airlines are at increasing risk of failure and should be brought into the consumer-protection system that covers package holidaymakers as a matter of urgency, says a government advisory committee.

The Air Travel Insolvency Protection Advisory Committee warned of “significant concern over the lack of financial protection for air travellers booked direct with a scheduled airline”.

ATIPAC oversees the consumer protection role of the Civil Aviation Authority and the Air Tour Organiser’s Licence (ATOL) system and reports to transport secretary Ruth Kelly.

Its annual report highlights the recent failures of airlines Silverjet, Maxjet and Eos, and points out they “demonstrate the significant financial loss passengers can be exposed to”.

ATIPAC chairman John Cox said: “Airlines are not providing suitable protection and advice for passengers. In the event of an airline failing, passengers often have to pay their own repatriation costs and those yet to travel often have to pay for replacement flights.”

By contrast, passengers flying with ATOL-protected tour operators face none of these risks. Their purchase is protected by a £1 ATOL Protection Contribution (APC) added to the price, which goes into a central fund administered by ATIPAC. “This two-tier system must not be allowed to continue,” said Cox.

ATIPAC, the CAA, travel association ABTA, the Federation of Tour Operators and other travel bodies have repeatedly called for scheduled airlines to be included in the ATOL scheme and the £1 APC added to fares. But ministers have resisted the calls, accepting the argument of major airlines that they are unlikely to go bust.

 

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