Agents and operators have called for simplified consumer financial protection arrangements to emerge from reviews of the Package Travel Regulations (PTRs) and Atol reform.
However, the CAA gave a clear indication that variable rates of Atol Protection Contribution on protected bookings are on the way.
The Department for Business (BEIS) is due to undertake a formal review of the PTRs after consulting informally on the 2018 regulations at a series of workshops last year, and the CAA is poised to consult on detailed Atol reform proposals.
Advantage Travel Partnership operations director Paul Nunn said: “We need simplification.”
Speaking at the spring AGM of Aito, the Specialist Travel Association, Nunn said the 14-day refund rule under the PTRS “didn’t work” during the pandemic, adding “The further you go down the chain, the more confusing it is.”
Expressions Holidays joint managing director Martin Garland agreed: “Refunding within 14 days when you have none of the refund cash is madness. We want a fair and equitable contract with customers.”
He told fellow Aito members: “I would like simplification, but do I think it will happen? No.”
Travel Trade Consultancy director Matt Purser said: “The industry has been calling for a simplification for years. Still if you book with an airline you’re not protected but if you book through an Atol holder you are.”
CAA group director for consumers and markets Paul Smith said the review of the regulations by BEIS presented “an opportunity to look at how the PTRs work, or don’t work, with EU Regulation 261” which covers air passengers’ rights to refunds.
But while agreeing “there is an opportunity to learn lessons” from the pandemic, Smith offered a note of caution saying: “The government has no lack of things to focus on.”
He reassured Aito members that “there is not likely to be a one-size-fits-all approach” to future Atol arrangements as he promised a consultation on “the preferred options” for reform and the implementation process “around the middle of the year”.
Smith insisted: “We want to preserve options.” However, he gave a clear indication that variable rates of Atol Protection Contribution (APC) are on the way.
He said: “We have a policy at the moment where you pay as much regardless of the way you do business. [But] businesses have different risks and that should be reflected.”
The APC on Atol-protected bookings is currently levied at a flat rate of £2.50 per person.
Garland welcomed the prospect of a variable rate saying: “The current system doesn’t work. Linking the APC to the cost of the holiday would be far better.”
But Purser said: “I’m not a lover of varying the APC.” He warned that varying the rate to reflect the financial risk of different business could affect trading “because I fear the rate would become public”.
However, Purser added: “I’m pleased to hear not one size fits all. Everybody was concerned the sector would be forced into trust arrangements.”
Nunn agreed: “Choice is what we called for. We’re pleased to hear there won’t be one form of protection. Bonding might suit a business better than a trust.”