XL failure could force government into action over extending protection

The failure of XL Leisure Group may finally provoke the government into extending financial protection to airlines, even though the government is yet to contact the trade following the collapse.

ABTA head of business development Andy Cooper said the company’s crash was only matched in seriousness by the collapse of Clarksons in 1974 which led to the introduction of the ATOL bonding scheme in less than a year.

He believes the current crisis and the number of consumers affected by it will galvanise the government into taking action and look at extending financial protection, even despite its apparent lack of interest.

He said: “I think the loss of people’s holidays is a highly emotional subject and the pictures of people being stranded abroad are also highly emotive.

“It is that sort of thing that gets through to the government; it is more likely to trigger a reaction than anything else.”

Meanwhile the Civil Aviation Authority has said it believes around 30,000 customers who booked packages with XL or its tour operator brands are still overseas on their holidays.

It has advised them against flying home early or paying unnecessarily for new flights.

CAA director of consumer protection Richard Jackson said: “It is important holidaymakers understand that if they are ATOL-protected their holiday continues.

“If you are not due back until this weekend or next week do not try and get an early flight and certainly do not pay for a new flight home.

“The CAA will arrange to bring you home on the same day you were due home with XL.”

The CAA added so far 29,610 customers have returned to the UK or had their flights rearranged following the collapse of XL Leisure Group on Friday morning after an eleventh hour rescue package failed.

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