Leading Scottish travel agent Bill Munro has labelled reforms to the UK’s Atol consumer protection scheme “confusing” and “inadequate” while saying the Abta logo adds to consumer confusion.
The government will start a consultation in May after proposing an extension of the Atol scheme to cover non-package holidays put together by travel agents, known as flight-plus.
But the trade remains unhappy that scheduled airlines will remain outside of Atol leaving as many as six million holidaymakers without financial protection, according to Barrhead Travel founder Munro.
He said the proposals were “confusing” and did not go far enough adding something had to be done “before there is a major airline failure leaving consumers massively out of pocket”.
“The main problem is that airlines are not covered by the proposed new rules.I’m certainly glad that at least some steps are at last being taken to attempt to stamp out abuse by those who use loopholes in regulations,” Munro said.
“The trouble is the new proposals are confusing, and they don’t go far enough, quickly enough. The result is holidaymakers are still likely to lose their cash.”
Munro said he was concerned that the changes, although designed to make the situation clearer to consumers, will leave many believing they are fully protected when they are not.
“I don’t think it is appropriate to exclude scheduled airlines from the new Atol reforms, and I would also urge everyone, consumers and the travel industry, to pressurise the government to do something before there is a major airline failure.
“There is a misconception that insurances covering airline failure and supplier failure are a substitute for Atol reform. We need the government to bring clarity to the industry before consumer confidence is lost and we need it to be as broad and as encompassing as possible.”
Munro added that a further source of confusion was consumers was that they continue to believe the Abta means the travel agent automatically offer full 100% protection.
He said: “Consumers still widely and wrongly believe that any holiday they purchase from a seller bearing the Abta symbol is financially protected in case of natural disaster or a tour operator going bust.
“The confusion further extends to other loopholes such as the practice of split invoicing, which internet-only operators use extensively to avoid VAT, as well as compensation payments to stranded passengers.”
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