The Civil Aviation Authority (CAA) has dismissed claims that extending the Atol consumer protection scheme to retailers will put companies out of business.
CAA consumer protection group director Richard Jackson told the Institute of Travel and Tourism conference in Venice: “It would not be sensible for the government to set up regulations that kill businesses. We want a competitive industry. We want new entrants. We have no intention of putting people out of business.”
Jackson added: “There may be people who do not have sufficient credit worthiness to get an Atol, but that is true now.”
He said it was inevitable some companies would find loopholes in the proposed flight plus regulations that will extend Atol protection to dynamic packages, arguing: “Regulation will always lag the industry.
“People who dream up brilliant businesses and holidays will also be able to find ways around regulations. In trying to close any loopholes we want to ensure we protect consumers while making sure we don’t stop businesses being profitable.”
Jackson rejected a claim that the regulations would be designed to outlaw companies acting as ‘agent for the consumer’. He said: “Agent for the consumer is a legitimate business model. But we believe it will be tougher [to organise] than some people think.”
He downplayed the idea that the biggest companies could withdraw their airlines from the Atol scheme following a suggestion Thomas Cook might do so. Jackson said: “Thomas Cook has been able to do that historically if it chose and has not done so. But it’s not our job to stop people doing things.”
Asked why there had been a delay between the Department for Transport announcement of Atol reform in February and a consultation expected to begin this month, Jackson said: “We are not the government. The delay is beyond our control. But it’s not a delay from the government’s point of view. The government has a complicated process for regulation. What comes out of it will have strong political backing.”
He told the ITT: “The government has made clear it wants consumer clarity and the deficit in the Air Travel Trust fund, backed by government guarantee, paid off. It’s a priority to pay that off as quickly as reasonably possible without raising the Atol Protection Contribution [on holiday bookings]. Towards the end of the year we will consult on new ways to fund protection once the overdraft is paid off.”
At the same time, Jackson said: “The government is willing to reach a view on the inclusion of airlines, with the possibility of doing so in the near term. It’s the best opportunity the trade has had.”