The reputational damage of moving the goal posts over customer refunds would hamstring the industry for long after coronavirus has blown over, says VIVID Travel’s Kane Pirie
Coronavirus is “scary” as my young son Hector would say but it is not a good reason to shotgun changes to the Package Travel Regulations.
The product we sell is only delivered post payment which means customers need full confidence they will either get the product they bought, or their money back.
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This principle has been around for decades, is at the heart of the Package Travel Regulations and is sacrosanct. It exists specifically to protect the customer in the event of unforeseen events, which are a fact of life, seemingly ever more so, and therefore to attempt to jettison it in the event of such a bump, however “scary”, is completely illogical.
Coronavirus will pass and customers will return to the market. As an industry we will still need people to have confidence to pay ahead of fulfilment and this is why the mooted changes to the obligation to refund are so dangerous. The reputational damage would hamstring us long after coronavirus has blown over.
The Package Travel Regulations should be upheld and consumers reminded of the formidable strength of ATOL protection, which in effect means the government stands behind all monies paid over to an ATOL licensed tour operator. This is a powerful message and customers will value that all the more going forwards post coronavirus, provided of course, we honour it.
Issuing vouchers is not permitted under the law and that is not the deal the customer accepted at the time of booking. Moreover, it is unclear that they would retain full ATOL protection. Tour operators also need to reflect that customers are also reeling financially from coronavirus issues and should not be disadvantaged through a hasty change to the rules of play, especially one intended to bite retrospectively.
The core problem is how can tour operators afford to process a high volume of refunds within a short period of time?
We have effected exactly that at VIVID Travel but this necessitated additional finance injected by me and I recognise that not all tour operators are in a position to simply call on their shareholders for funds. Rather than shooting ourselves in the foot, acting like a dodgy insurance company that refuses to pay out when a legitimate claim is made, why doesn’t the government simply follow other countries and give tour operators additional time? Instead of the Package Travel Regulations current 14 days something in the range of 3 – 6 months, for example.
This seems much easier to explain to customers and is more likely to be accepted than a flat rebuff to cash refunds. It also echoes the pragmatic move on providing a 6 month grace period for the MOT testing recently announced.
As the industry waits with baited breath, praying the government greenlights denying customers their lawful refunds, I actually hope they do not. It will tarnish our industry for the rest of our working lives. Further, it could unlock the gates of hell with a violent storm of litigation including customers, the CAA, ABTA and a judicial review led by tour operators who have already complied and would understandably feel cheated.
But above all, it is simply not necessary as a moratorium will suffice and work better for all interested parties. What is “scary” about that?