Comment: Criticism of Abta highlights wider issues

There is little dispute that Abta has the best-recognised logo in travel, but less agreement on what it stands for, says Travel Weekly head of news Lee Hayhurst

Abta found itself under fire again last week for the way it promotes itself to the public in terms of financial protection.

Not for the first time, the criticism came from Travel Counsellors – this time on the back of a consumer survey commissioned by the non-Abta agency group. This found, as have many surveys before, that the travelling public do not understand financial protection.

That is not surprising. A Travel Counsellors’ flow chart depicting how a customer should behave to ensure they are protected illustrates the complexities.

So when Abta sought, in its new “Look for the Logo” campaign, to offer a consumer-friendly version of the protection and other services it and its members offer, it entered territory littered with potential pitfalls.

Travel Counsellors has campaigned on this issue for some time, having gone to great lengths to introduce its own simple, trust-based protection system that aims to cut through the confusion.

The question remains: are Travel Counsellors’ complaints about the way Abta talks about itself in this area valid or, as Abta suggested last week, merely an attempt to gain a competitive advantage.

We could add a second question: is anyone outside of a small group of travel people bothered? Certainly the general public and mainstream media don’t appear to be.

There is no doubt Abta enjoys latent public trust and awareness from a time when it did offer a money-back guarantee on a holiday booked through a member.

It’s true Abta no longer offers this, having watered down the promise in 2006 basically because the association could no longer afford to keep it.
Abta was running the risk of being bankrupted by a single collapse or fraud. Indeed, it had come perilously close to this.

This was a case of an organisation set up for an analogue age responding to the digital era.

It did not please everyone. There were those within Abta who believed the Abta promise was integral to the logo.

The Office of Fair Trading (OFT) recognised the significance of the change at the time by withdrawing Abta from its Consumer Code Approval Scheme just months after its inclusion.

Travel Counsellors was a key critic of the change. Chairman David Speakman has argued consistently that Abta members sell holidays to people who think they are protected when they are not.

Last October, Speakman reported Abta to the OFT after trawling members’ sites and finding numerous examples of apparent contraventions of the association’s own advice on wording in relation to “fully bonded” or financial protection.

Last week, Speakman suggested Abta’s Look for the Logo campaign contains “so many misleading messages” it is “astonishing” – an accusation Abta refuted vigorously.

Does Speakman have a point? Certainly, Abta still likes to use the word ‘protection’ – it is one of three words in the strapline Abta uses in its new YouTube video – and Speakman is probably right when he argues “people believe this is financial protection”.

Abta does still provide bonding for non-licensable product such as coach, cruise and rail trips amounting to 3.7 million holidays. This is not explicitly stated in its marketing or YouTube video.

The £19 million Abta says it has “paid out” to “ensure holidaymakers can have their holiday or their money back” refers to the protection Abta still offers on pipeline money. This is protected by bonding, though pay outs are now capped.

Speakman argues tour operators would legally have to honour these bookings anyway. However, Abta bonding ensures an individual failure does not trigger a domino effect which brings down those that would otherwise fulfil the bookings.

Abta’s website claim that “All holidays sold by Abta members are financially protected whether by Abta, Atol, or other schemes” is debatable, given the experience of some customers following failures in recent years.

But it’s worth pointing out that Abta’s YouTube video has been viewed just 506 times, reflecting the fact that holiday financial protection is only ever an issue for consumers and the media when there is a problem. And even when problems occur, it seems memories are short.

From the outside, this recurring spat must look like a family squabble. The reality is that as long as the financial protection system continues to offer loopholes, confusion and a lack of clarity will persist.

The risk is that such a spat detracts from graver challenges facing the sector.

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