Progress on Atol and PTRs reform must await new government, says Travel Weekly’s Ian Taylor
Rishi Sunak’s announcement of a general election on July 4 wrongfooted no one more than Conservative MPs, with the mood in government described by a former minister as “murderous” and an acting minister labelling the election “Charge of the Light Brigade stuff”.
Most industry bodies have already launched ‘manifestos’ outlining the benefits of travel, aviation and tourism, and of priority policy ‘asks’ of a new government. We can expect few if any of the issues raised to feature in the election debate.
The timing is significant. Sunak opted to go early rather than wait on the grounds that nothing in the political situation is likely to improve.
Any scope for tax cuts has been torpedoed by the state of government finances, with the International Monetary Fund warning last week of a £30 billion funding gap and dismissing Treasury spending plans as “unrealistic”.
This month’s economic news was as good as it’s likely to get this year. Headline inflation fell to 2.3% in April, average ‘real’ wages increased for a 10th successive month and the UK economy grew 0.6% in the first quarter. Never mind that household incomes remain barely above the level of 2010.
However, inflation is forecast to rise again, with economists noting services inflation remained at 5.9% in April, reducing the prospects of serial cuts in interest rates by the Bank of England, while five million households still wait to remortgage at higher rates.
We can assume the incoming government will be led by Keir Starmer given Labour’s poll lead and barring unforeseen and extraordinary circumstances. Question marks remain only over whether Labour will have a marginal, significant or sweeping majority.
But the situation the new government faces could be dire judging by a dossier compiled by Labour chief of staff Sue Gray, the former senior civil servant who reported on ‘party gate’. The Financial Times reported Labour officials have labelled this “Sue’s shit list”, warning of local council bankruptcies, the collapse of water companies, a prisons crisis, a universities funding crisis, NHS crisis and fresh public-sector pay demands.
Travel industry concerns are likely to be well down the list of priorities. Labour has already slashed spending commitments on decarbonisation – a key issue for the industry – and while a Starmer government ought to be less hardline on restrictions on UK-EU labour mobility, Starmer may want to appear tough on immigration.
Sunak has at least removed a political logjam, ending a period of continuous crisis and uncertainty since the end of the pandemic. How much change the election brings in policies affecting travel is another matter.
At least we may see progress on Atol Reform and revised Package Travel Regulations once new ministers get up to speed. But the next Parliament – due to meet on July 9 – will be one of the least experienced in decades.
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