Air Travel Organisers’ Licensing Bill

Debate between John Hayes and Patricia Gibson

3rd reading: House of Commons & Committee: 1st sitting: House of Commons & Report stage: House of Commons
Tuesday 11th July 2017 Commons Chamber

[Mr Hayes]

I really must press on.

Appendix 4 of the annual report is categorical about the committee’s constitutional role, and it sets out the committee’s membership, which includes the Association of British Travel Agents, the Association of Independent Tour Operators, the Association of Airline Consolidators, the Board of Airline Representatives in the UK and the Travel Trust Association. The committee also includes up to 10 independent members, of whom one will be the chair. Of course, as I set out earlier, the committee’s independence and expertise mean that it is in a perfect place to do the very work that the hon. Member for Kingston upon Hull East perfectly properly recommended to the House and that the amendment seeks to achieve.

Therefore, in the light of the fact that the Government have already obliged in law to review legislation within five years and have set up the independent panel of experts to report; that I have committed to seek guidance on the important issues the hon. Gentleman raises and to write to that committee asking it to review the legislation; and that the committee will report more often than annually as necessary, it would be extraordinary if the Labour party pushed this matter to the vote. It would be unreasonable for it to do so, but in the end that is a matter for it, not for me.

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

Last week, there was uncharacteristic consensus in welcoming the Second Reading of this Bill, as it is perfectly desirable and sensible to update the ATOL scheme to ensure more protection for travellers when they go on holiday and to align it with the latest EU directive. However, there undoubtedly are a number of questions that will arise in relation to this scheme once the UK leaves the EU. We need cast-iron guarantees that the rights of and protections for travellers will not be diminished after Brexit.

On Second Reading, the Minister was clear in saying that he wished to protect passengers, but we lack the detail on that. We do not know when the UK will develop its own system of passenger rights and compensation in the aviation sector after Brexit, how similar it will be to current arrangements or how it will affect EU airlines and passengers. Scottish National party Members fully support the Government’s reviewing the impact of provisions under this amendment; surely it is right that they review the impact of the provisions to ensure that UK consumers are protected and are not disadvantaged by using EU-based companies. When we leave the EU, passenger rights must not be affected, and consumers and companies based in the UK and/or the EU need clarity on what their obligations are in respect of the ATOL scheme.

We have heard today that this will all be taken care of in the great repeal Bill, and I am sure we all hope it will. Last week, the Minister said he was keen to protect consumers, and I am optimistic that that will be in evidence today. His reasons for resisting reviewing the impact of provisions under this amendment do not seem clear. Periodic reviews still make sense; having a review within one year will inform the impact of the provisions and will still be helpful. The Minister is an eminent and sensible man, but I am at a loss here: if ATIPAC already carries out yearly reviews, why resist this? The reviews we are talking about merely write into legislation something that it appears is already happening. What has the Minister to lose? The committee provides advice, we are told, and this amendment writes into legislation—

[Mr Hayes]

This is very simple: if something is already happening—if it is already in law—one does not have to legislate for it again.

[Patricia Gibson]

The Minister is being a wee bit disingenuous here—

--- Later in debate ---

[Patricia Gibson]

Clause 2 requires only that the Secretary of State has an affirmative resolution from each House of Parliament, but that is not enough. The Government should be required to conduct a proper consultation and assess the potential impact of any proposed changes to the ATOL scheme and air travel trust that they intend to introduce through secondary legislation. Any proposals must be fully transparent, and consumers and businesses alike must be formally consulted in the process to allow for proper scrutiny. We trust that the Minister will accept that and our reasons for tabling the amendment.

[Mr John Hayes]

I can satisfy the hon. Lady entirely. I fully intend to ensure exactly what she asked for: full consultation and a comprehensive impact assessment in respect of any regulations to be made under these measures. On that basis, I hope she will withdraw the amendment. If she does not, she will look rather daft.

Air Travel Organisers’ Licensing Bill

Debate between John Hayes and Patricia Gibson

2nd reading: House of Commons
Monday 3rd July 2017 Commons Chamber

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

Let me take this opportunity to welcome you to your place, Madam Deputy Speaker. I want to thank the Minister for his summary of the Bill’s provisions. The decision to update the ATOL scheme to provide more protection to travellers when they go on holiday, and to align it with enhancements to the EU and UK travel package regulations that predate people booking their holidays on the internet, is of course to be welcomed. We need to ensure that the public are protected by updating the UK’s financial protection scheme for holidaymakers. It is important to keep pace with the innovation in the online travel market and ensure that appropriate protection is in place, regardless of whether consumers choose to book online or on the high street. Of course we want to make it easier for UK companies when selling holidays across Europe, and they will be able to trade under the UK’s ATOL scheme as opposed to the regimes in each country they sell to. The measures in this Bill are important as we need it to cover new digital business models and modern consumer purchasing models.

We know that more than three quarters of consumers booked their holidays online last year. The EU package travel directive of 2015, applicable from 1 January 2018, extends the protections beyond traditional package holidays organised by tour operators and also gives clear protections to 120 million consumers across the EU who book other forms of combined travel. The directive is expected to reduce detriment to consumers by about €430 million per year across the EU, and reduce administrative costs and burdens on business.

Passenger rights have been enshrined in EU law, and consumers and businesses deserve to know, need to know and are keen to know how Brexit will affect them. They seek cast-iron assurances that the rights and protections of travellers will not be diminished after the UK leaves the EU, and I know that the Minister understands that.

Existing EU directives mean that UK passengers are currently entitled to a number of benefits if a journey is cancelled or delayed. Such protections give consumers some peace of mind when they are booking travel. Since the EU legislated to provide a comprehensive system of air passenger rights in 2004, the increased awareness of those rights and the chance to complain or appeal has led to a significant increase in the number of people doing so. That is a good thing, because it democratises the market and gives consumers proper routes of redress—the Minister mentioned the importance of intervening when the market has failed.

It should be noted that there are examples of court cases that have ruled on the circumstances in which airlines must pay compensation. Appeals against some of those judgments have demonstrated the reluctance of some airlines to pay out compensation unless the legal position is made absolutely clear. The rights of passengers must be clear and they must be upheld; otherwise, there will be a detrimental impact on passenger numbers and, ultimately, jobs will be put at risk.

Brexit clearly poses challenges in respect of passenger rights. It is essential that the UK develops its own system of passenger rights and compensation in the aviation sector, and there must be clarity on how such a system will affect non-UK airlines and passengers. Will we have such a system in the UK, post-Brexit? A system will clearly be required, but we, and non-UK airlines and passengers, need to know how similar it will be to current arrangements. In the post-Brexit world, what is to become of all the EU protections currently in place? Will they continue under the UK Government? What reassurances can UK passengers be given? The Minister referred to the “minimal impact” on consumers and business post-Brexit, but more detail is obviously needed, and it is keenly awaited.

The collapse of Lowcostholidays was a stark reminder of the importance of the EU package travel directive, which offers consumers protection in case of insolvency. Will the Minister give due consideration to the points I have raised and update the House as soon as it is practical to do so? He spoke of the need to revisit the relevant consumer protection as technology advances, but the question at the forefront of everybody’s mind is what will happen post-Brexit.

[Mr John Hayes]

I welcome you to the Chair, Madam Deputy Speaker.

The hon. Lady invited me to respond as quickly as possible, so I shall respond now. The reform of ATOL and the package directive will bring the arrangements throughout Europe more into line than they have ever been before. It is imperative that we protect consumers through regulation in the way I have described, so it is inconceivable that, post-Brexit, we will not want to reflect the protections that already exist here and that we see increasingly abroad.

[Patricia Gibson]

I thank the Minister for his response. The clear guarantees that businesses and consumers are looking for must not be eroded after Brexit. If we have guarantees and the Minister can give us further detail on them, passengers and businesses will be reassured.

Clause 2 will give the Secretary of State power to reform the ATOL scheme and the air travel trust fund, with only an affirmative resolution by each House of Parliament required. Any changes that the Secretary of State wishes to introduce to the scheme must be preceded by a full consultation and an impact assessment that allows for proper scrutiny of the proposals.

Although we absolutely welcome the move to update the ATOL scheme to ensure that a maximum number of travellers are protected when they go on holiday and to align it with the EU travel directive 2015, passenger rights have been enshrined in EU law and consumers and businesses deserve clarity on how Brexit will affect them. The UK Government must provide more flesh on the bones and explain how such rights will be written into our laws. The updating of the scheme is to be welcomed, but the post-Brexit world poses a range of challenges on which consumers and airline business require clarity. I forward to hearing more detail from the Secretary of State in due course.