MPs back call for urgent Government intervention in holiday refunds row

A cross-party group of MPs has backed a letter calling on the Government to ‘urgently intervene’ in the refunds row between the travel industry and consumers.

The letter sent to aviation minister Kelly Tolhurt by the consumers’ association Which? claimed that UK consumers are owed billions of pounds for cancellations due to the coronavirus pandemic.

It said that large numbers of people, many of whom are facing financial problems of their own due to the coronavirus crisis, are struggling to get travel firms to pay up.

Written by Which? chief executive Anabel Hoult, the letter claimed that ‘trust in the travel sector is at a record low’.

"Many of the UK’s biggest airlines and travel operators are openly breaking the law by refusing refunds or failing to offer one within the required period," it said.

The letter, which was signed by 30 MPs, also called for clarification over whether refund credit notes issued by many companies instead of cash refunds are protected by the Air Travel Trust Fund.

The Government and the Civil Aviation Authority have refused to confirm that ATOL protection extends to credit notes.

Even after the failure of Shearings, the CAA won’t say whether customers who were issued with credit notes prior to its collapse will be refunded.

It has sent application forms to customers who were owed refunds for trips that had been cancelled before Shearings failed in May, but it hasn’t confirmed if it has or intends to refund those who had accepted credit notes from the operator.

The letter said: "We are aware that many travel companies are forcing customers to accept RCNs and vouchers in lieu of cash refunds. While we support the use of RCNs where a customer chooses to accept one, there remains a worrying lack of clarity over the level of protection linked to them.

"Now more than ever, it is vital that people can be certain that their hard-earned money is adequately protected against insolvency, so that consumers can confidently opt for RCNs where possible," it said.

Which? also pointed out that as flights and holidays begin to resume, consumers are unsure of their rights if they’re unable to travel due to the Foreign Office advice against non-essential trips, or because they’d need to quarantine for 14 days when they return to the UK.

"As we approach the summer holiday period, it is clear that action must be taken to tackle the challenges specific to travel head on and to ensure that trust in the sector is not permanently damaged," it said, while calling on the Government to ‘ensure that airlines and holiday companies allow flexible rebooking and cancellation options for those no longer able to travel’.

Tui has confirmed that it will allow customers to change their holidays if the UK quarantine remains in place after it re-launches flights, but not all travel companies have offered the same guarantee.

Rory Boland, editor of Which? Travel, said: "For months, people have faced lengthy, time-consuming battles with airlines and travel companies who have unlawfully delayed or denied refunds for cancelled holidays, and in some cases, forced customers to accept refund credit notes in lieu of the cash they are owed."

"Trust in the travel industry has hit rock bottom and the government must urgently step in to restore some order to a sector that has been left in disarray by the pandemic, and where the law is being widely ignored.

"As a first step, it must urgently clarify whether refund credit notes for package holidays are financially backed by the ATOL scheme, while also setting out a clear plan to support the industry to resume safe air travel."