CAA urges Government to close protection loophole

The Civil Aviation Authority has stepped up its campaign to urge the Government to close the loopholes in financial protection for customers.

Following extensive consultation with the travel industry, the CAA is demanding protection for people buying flights sold direct by airlines and those purchasing accommodation through Internet sites linked to airlines. Currently, only holidaymakers buying packages are protected by the air travel organiser’s licence.

The CAA’s “Advice to Government on Financial Protection for Air Travellers and Package Holidaymakers in the Future”, available on the website www.atol.org.uk, said sharp reductions in the scope of holiday protection meant a substantial and growing number of travellers were at risk of financial loss or of being stranded abroad.

In 2003, 12 million ex-UK leisure flights and holidays carried no protection and the coverage of ATOL has declined from 98 per cent of leisure travellers in 1997 to 70 per cent in 2003. Research shows the public is largely unaware of the lack of protection when they buy separate holiday items or wrongly believe they are protected by travel insurance.

“The ATOL system has served the public well over a long period,” said CAA consumer protection group director Helen Simpson. “But the way holidays are sold has changed and it can’t now provide what people want or expect. “The current legislation was introduced over 30 years ago, when scheduled airlines were often state owned and less likely to collapse. They now operate in a highly competitive market and some failures are inevitable. There are real risks to the public which they do not understand.”

Any change in the law could take years to be passed, so the CAA is asking the Government to consider interim measures that could be implemented by airlines on a voluntary basis.

These include carriers arranging for packages to be sold through an ATOL holder and selling improved insurance which covers airline failure. Both ABTA and the Federation of Tour Operators welcomed the CAA move.

FTO director general Andy Cooper said the Government should act quickly. “We urge the government to commit to the earliest possible timeframe for legislative action and to add their weight to the CAA’s recommendations for effective interim protection for travellers,” said Cooper. “It is not an option to delay or to act only after some new major financial collapse. British citizens need and deserve proper protection now.”