ABTA scores own goal with new policy

Comment by Jeremy Skidmore (www.jeremyskidmore.com)

ABTA’s decision to reduce the limit of its financial protection is already having repurcussions that will leave consumers, as well as agents, questioning the merits of the organisation.

We’ve known for some time that holidaymakers who are the victims of fraudulent agents will no longer be re-imbursed by ABTA. That’s the spin coming from the association; but the fate of customers who become victims of honest retailers is now also far from clear.

If that agent has made bookings with another ABTA member, the association will insist on that operator re-imbursing the customer. But what power does ABTA have over direct and/or overseas suppliers that the failed agent may have dealt with?

To add to the confusion, operator members that sell accommodation only, or car hire, are not required by law to provide protection.

The key word here is confusion. If you’re struggling to get your head around what may or may not happen if an agent goes bust, think about the poor customer.

ABTA argues that its safeguards were always meant to protect against business failure, not fraudsters, and it can no longer cover the victims of crime because the opportunities to commit fraud are massive.

These days, all you need is a computer, a very basic website and the will to deceive. You don’t even have to provide real air tickets to customers; instead you can just fob them off with fake e-tickets.

I have some sympathy with ABTA, but the bigger picture is that it has made a rod for its own back by claiming, for many years, that its unique selling point is that the customer’s money is safe if spent through one of its agents (see Comment from Feb).

When you live off a promise like that, you’re setting yourself up for a fall. No wonder newspapers have run stories saying that ABTA can no longer provide people with protection.

David Speakman of Travel Counsellors has this week been banging on about how ABTA now offers no security and pointing out that his company guarantees to protect holidaymakers’ cash. He’s right isn’t he?

No wonder he’s making political capital out of it and I wouldn’t be surprised if he picks up business from worried customers on the back of it.

I understand ABTA is putting in place some insurance policies that customers can take out to make sure they are covered in all circumstances. Talk about shutting the gate after the horse has bolted! Wouldn’t it have been far more sensible to set this up first and then spin the story about the association moving with the times and changing to a new form of holiday protection?

As it is, the beleaguered retailer is going to find it even harder to get people through the door (as if it wasn’t difficult enough already) following the negative publicity surrounding this change.

Fancy being in an agent in late 2006? Pete Waterman is speaking at this year’s Convention. As one of his most famous charges might say, “I should be so lucky, lucky, lucky, lucky…”