New government measures being enforced from July aim to provide clearer and stronger protection for holidaymakers by ensuring more holiday types are covered by consumer protection rules.
The plans unveiled by consumer minister Andrew Griffiths today (Thursday) follow a shift towards online booking, up from 76% of holidays in 2016 to 83% last year, according to the Department for Business, Energy and Industrial Strategy.
Changes to the way travel is booked – such as using online booking sites – have created a gap in consumer protection, with 50% of holidays not currently financially protected if a company fails, according to Abta.
The new rules will help close the gap, meaning more holidays will be protected by consumer protection rules.
Under existing travel regulations, around half of UK holiday travel arrangements – 20 million packages and three million flight-plus holidays – are financially protected.
Flight-plus arrangements will no longer exist from July 1 and many will become packages.
The changes to the Package Travel Regulations will see more travel arrangements becoming packages, meaning these types holidays will benefit from both financial and legal protection.
UK families spend on average £22.10 per week on package travel abroad, which represents a third (33%) of household spending on recreation and culture, with the way people buy holidays having “changed significantly”.
The new measures will be underpinned by information requirements to ensure consumers are clear on what travel product they are buying and the corresponding level of protection.
This comes the day after the government published a green paper on modernising consumer markets, holding companies to account who fail consumers and looking to strengthen enforcement of consumer rights.
The new rules outlined today include:
· an extension to current protections to cover millions of extra holidays
· a requirement for better information to be provided to travellers at the point of booking, making it clear what their rights to refund are
· ensuring the business that puts together the package holiday is responsible for the entire holiday – even if some elements will be fulfilled by other companies
The rules will also provide clarity to businesses, increasing fairness in the travel industry by making online outlets as responsible for consumer protections as traditional travel agents, according to the government.
It is working with travel industry leaders to develop guidance for businesses to help them comply with the new regulations.
Regulations will be introduced in Parliament this month, with protections coming into force from July 1.
Abta chief executive Mark Tanzer said: “We are still waiting for the government to publish the regulations that will take effect from July 1.
“Today’s announcement sets out the government’s expected approach which will result in more holiday travel arrangements being classified as packages meaning greater protection for these types of holiday.
“We still need the detail of the final regulations and Abta will be working hard to make sure members understand what the final regulations mean for their businesses and the steps they need to take through updated guidance notes and webinars.
“Under existing travel regulations, around half of UK holiday travel arrangements – packages and flight-plus holidays – are financially protected. From 1st July flight-plus arrangements will no longer exist and many will become packages, so while the number of holidays protected might not necessarily increase – the level of protection will, as they will also be required to have legal protection.”
Tanzer added: “Once published, the timescale is very tight for UK businesses to understand these regulations and to make necessary changes by July 1.
“Abta is helping its members to understand their legal responsibilities and support them in making any necessary changes.
“Consumers not booking with an Abta member will have to rely on UK Trading Standards if they are concerned a company they are dealing with is not providing the correct protection for travel arrangements.”
An event covering the new package travel regulations for travel agencies is being held by Abta in Birmingham on May 1 to help agents understand what the regulations mean for their business, the steps they need to take and how their liabilities will change.
Griffiths said: “When we book a package holiday we expect it all to go according to plan, but if a company goes bust it can ruin more than just the holiday, leaving people out of pocket or even stranded.
“These new rules mean that internet explorers can book their holidays online, secure in the knowledge they will be compensated in the same way as someone who booked their holidays through a travel agent if something does go wrong.”