Loss of consumer confidence is “the key challenge” facing the outbound industry following the wholesale failure to pay refunds within 14 days for cancellations due to Covid.
But that is no reason to switch away from selling package holidays or to tear up the Package Travel Regulations (PTRs) which impose the 14-day rule.
That is the view of leading industry lawyers.
Rhys Griffiths, partner and head of travel at law firm Fox Williams, told an Abta Travel Law Seminar: “Frankly, this government has more pressing things to do than change the PTRs.
“I can’t see a situation where customer money is unprotected. The government could not allow it.”
Lawyer Jo Kolatsis, director of Themis Advisory, agreed saying: “We all knock the PTRs and would like to see reform, but the PTRs did what they said on the tin and provided consumer protection.
“The problem was they couldn’t foresee a global shutdown. But without them we would be in a bigger mess.”
Flight Centre Travel Group legal counsel Jesse Braid told the Abta seminar: “The key challenge [now] would be loss of customer faith because we just could not meet that 14-day obligation to refund.
“We didn’t have the people and we didn’t have the systems in place for that.”
Braid said the difficulty of paying refunds was compounded by suppliers, saying: “We could not get refunds from suppliers. Most put the brakes on and organisers foot the bill.
“Now the challenge is how do we sell packages with all this uncertainty, when the package organiser is the one financially liable for the uncertainty?”
Yet he insisted the solution was not to stop selling packages. He told the seminar: “The main issue is looking at what you sell.”
“There are so many benefits to having control over the product you sell. It’s not about changing the package but changing what comprises the package.”
Braid said Flight Centre Travel Group would in future “be much more selective with the suppliers we work with and who provide better payment terms for us”.
He added: “Selling some destinations just causes you difficulties and costs you money.”