KEN McLEOD
When Monarch collapsed in the autumn of 2017, it triggered the largest peacetime repatriation of British holidaymakers. In all, the Government-run operation rescued 110,000 stricken passengers from resorts across Europe and beyond at a cost of £60 million to the taxpayer.
Fast forward to February this year and the news that airline Flybmi had also fallen into financial strife. In complete contrast to the Monarch response, stranded passengers were simply left to their own devices with with no practical or financial help to get back home.
It hardly seems fair that the level of assistance provided by the Government is determined by the size of an airline and its customer base, but this is the kind of discrimination that passengers who choose to book with smaller airlines are facing.
A change, however, could be on the horizon. In the months following the Monarch repatriation, the Department for Transport commenced its independent Airline Insolvency Review. The primary remit was to identify a process to ensure the bill for any future airline collapse would not be picked up by the taxpayer.
The report is expected to be made public later this month and it is anticipated that it will include recommendations for a new airline failure levy to be added to fares. It’s something that the SPAA has long campaigned for – even though the idea may be unpalatable to major airlines.
For years now we have called on the Government to look at a model used in the Netherlands. All air passengers pay a levy of around one Euro on fares: this is then paid into a centrally held fund, and the proceeds used to repatriate passengers stranded by an airline’s collapse.
Had our suggestion that fares from all UK departures ringfence a simple £1 per passenger levy been listened to when it was first raised over a decade ago, every single passenger who has ever lost money due to an airline failure could have been repatriated or refunded at no cost to the public purse.
We anticipate that the recommendations of the DfT report will suggest a levy amounting to just a few pence on each flight. This, in our opinion, is a small price for consumers to pay for the peace of mind of knowing they will get assistance should the worst happen.
Major airlines don’t see it that way, however, and I fully expect that larger carriers will lobby against a levy. Their argument is that they cannot see a situation where they would ever go bust, therefore why should a financially stable airline subsidise one that could be at risk.
Last year, the SPAA commissioned a survey of Scottish air passengers on their understanding of travel consumer protection. It showed a staggering lack of knowledge about legislation, with around 65% of the 500 travellers questioned wrongly believing they would be refunded if their airline collapsed.
While those travelling as part of a package agreement are protected through established schemes such as Air Travel Organiser’s License (ATOL) and the more recently introduced Package Travel Directive (PTD), flight-only sales do not offer similar levels of protection.
Regardless of who pays into what fund, it is clear the consumer believes there is some form of protection. The reality is that there is no level playing field, either in the protection offered or in how the Government responds to an airline failure.
Whatever the solution, we need to find one that is in the public interest – and one that ends unnecessary and unfair discrimination against passengers who exercise their right to book travel with a smaller airline.
Ken McLeod is president of the Scottish Passenger Agents’ Association
The SPAA, founded in 1921, is the world’s oldest organisation representing travel agents. It currently has 120 members and 92 associate members across the travel and transport industry,
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