‘Unfair’ Atol holiday protection scheme needs fundamental reform say MPs

Government changes to the Atol system which protects holidaymakers from tour company collapses do not go far enough, according to report by MPs.

Due to take effect today, the changes “are not widely supported”, the report from the House of Commons Transport Committee said.

“The Government has not clearly based its reforms to the Atol (Air Travel Organisers’ Licensing) scheme on evidence from consumers,” said the committee.

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The MPs also said it was unfair that those booking a short, low-cost package paid the same Atol protection contribution (currently £2.50 a passenger) as those on extensive luxury holidays.

The committee recommended this contribution should be linked to the value of the holiday.

The MPs said the Atol scheme, which was introduced in the early 1970s, was “now in a mess” and needed fundamental reform.

“Where once it covered the vast majority of holiday bookings involving air travel, it now covered fewer than 50 per cent and this proportion was “falling rapidly”, the report said.

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Changes by the Government coming in today include Atol cover being extended to “Flight Plus” bookings which will require tour operators to apply Atol protection when accommodation and/or car hire is booked within a day of booking a flight.

In addition, a bespoke Atol certificate will be issued to each customer to clarify the protection provided.

Launching the report today, the committee’s chairwoman Louise Ellman said: “We welcome the changes to Atol that are being introduced today.

“Flight Plus will extend financial protection to millions of people who put together their own travel packages with travel agents, mainly over the internet.

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“New Atol certificates to be issued with holiday bookings should provide greater clarity for holidaymakers.”

She went on: “But other aspects of Atol remain unsatisfactory. The charges are unfair to some consumers and to sections of the travel industry.

“The Air Travel Trust Fund, that backs the scheme, is £42m in deficit.

“Information can be unclear and protection is patchy for passengers who book flights only; and holiday sales by airlines or some types of travel agent remain outside the scheme.”

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