Air Travel Organisers’ Licensing Bill

Luke Pollard Excerpts

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

[Luke Pollard (Plymouth, Sutton and Devonport) (Lab/Co-op)]

It is a privilege to follow my comrade from Cornwall, the hon. Member for St Austell and Newquay (Steve Double).

I am in an odd position in this debate as I have worked for the Association of British Travel Agents and Thomas Cook, and I now sit on the other side of the fence examining the ATOL regulations for which I made the argument several years ago. It is great to be back on this subject again.

I hoped that the first Bill we addressed in this Parliament would be about food banks or a new train line to the south-west, but ATOL reform is as good a place to start as any. I welcome the Bill. The updating of consumer protection for holidaymakers is long overdue and it comes on the back of several improvements in recent years in the way in which holidays have been sold and protected. I spent many years in Brussels working with colleagues of the hon. Member for Chelmsford (Vicky Ford) and others on how we could strengthen the consumer protection for people buying holidays. As other hon. Members have said, the way in which holidays are sold has changed considerably in recent years. The travel industry operates under legislation that has not kept pace, in the UK or the EU, with the way in which travel is sold, partly because of the inventiveness and ingenuity of innovators and entrepreneurs in the travel industry. We are fortunate that the UK sector is second to none in how entrepreneurial it is.

My starting point for considering the Bill is to ask whether it will give certainty and confidence to consumers. The ATOL certificates introduced several years ago by the coalition Government were a step forward, but more can be done. In particular, people are often confused by the protection given when they buy a package, when they buy a flight-plus arrangement or when they buy separate arrangements sold at the same time with transferred data—a linked travel arrangement. The Bill does not say much about what secondary legislation will accompany it, and it will be essential that we get the detail right. The industry and consumers have been waiting for the Bill for some time and it is important that there is no further delay.

Having listened to the debate and having worked in the travel industry for a number of years, I think it is important that the House understands the clear distinction between the protection afforded by ATOL for package sales and those that can be afforded by buying decent holiday insurance, including SAFI—scheduled airline failure insurance. As the hon. Member for Milton Keynes South (Iain Stewart) remarked, time is running out. We are six months away from legislation needing to be in place and 12 months away from full compliance. For an industry already selling holidays 12 to 18 months ahead, that creates a difficulty for consumers when it comes to understanding what protections will be in place for their holidays.

The package travel directive, which I have learned to love and hate at the same time, introduced many new concepts and requirements, particularly in relation to the notable systems changes required to facilitate additional information provisions within the directive. It gets even more complicated when one starts looking through it. Travel businesses need to have sufficient time to prepare for the effective date of 1 July and to plan sales beyond 2018. That preparation is already at an advanced stage. We need the Government to publish the regulations quickly so that they can be properly consulted on and so that industry can take the necessary steps to adapt to them. I am thinking particularly of small businesses that may be captured for the first time in the scope of the regulations.

Travel is a complex fast-paced industry full of fantastic people. These technical updates need to be fully understood and implemented over time for many different booking systems, both in UK companies and those that operate internationally. That is why the draft regulations cannot come a moment too soon. The Bill will help to clear up confusion about which holidays are protected and which are not. There was an interim stage of flight-pluses: buying a flight plus another element, such as holiday accommodation or car hire. Wrapping them all together is a positive step forward, but will the Minister look again at how linked travel arrangements are treated in the Bill? He mentioned an attempt to bring LTAs into the scope of the protection. I would like to see more detail on that, because how they are treated is especially important. If those transactions are not treated in the right way, they can fall outside the scope of the protections.

The people of Plymouth should not need to look into the small print of their contracts or their regulations to work out if they are protected. At the moment, there is still too much detail for people to understand whether they are fully protected. Given my newness in this House and the fact that this is the first Bill to be presented, will the Minister do me a favour and address a few things in his summing up? Will he clarify whether the implementation date for all bookings is from the point of sale or the point of departure? That is really important in terms of understanding whether holidays being sold now, which may be captured by the regulations after the implementation date, need to have retrospective protection added to them or whether that needs to be added subsequently. That could result in real confusion for consumers, so I would be grateful if the Minister cleared that up. I would also be grateful if the Minister reaffirmed that the protections afforded by not only the package travel regulations but the air passenger and other passenger rights regimes will be carried through when we leave the European Union.

I would like to spend a moment on the air travel trust fund. For those who have not spent time looking at how the ATTF operates, the fund provides back-up support in the event of a holiday company going down. It should ensure that there are sufficient resources not only to bring people stranded abroad home but to refund passengers who have not yet taken their holiday. Will the Minister provide an update on how it is going? Now there is £140 million in the fund and provisions in the Bill to create what I suspect are protected cells within the air travel trust fund—the Government have up to this point shied away from doing that—will he clarify how it will work in practice? Should a new entrance cell in the ATTF be exhausted by the failure of a company in that cell, will the ATTF for the remainder of the holiday industry need to top it up? If a company already covered goes bust and the fund is insufficient, will the ATOL protection contributions—the £2.50 we pay for protection—be transferred into that element of the ATTF to ensure that people are brought home? The ATTF has been exhausted in the past so these technical questions could help to provide reassurance for consumers to know that the fund will always be there.

Finally, on enforcement of the Bill, I note that the Civil Aviation Authority and Trading Standards are to take a larger role. The CAA has, for quite some time, done a good job of enforcing the ATOL regulations. I am, however, concerned about Trading Standards, which is already under a huge amount of pressure and stress to deliver the work it currently undertakes. This could further add to that difficulty and complexity.

It is great that so many people are familiarising themselves with the intricacies of ATOL protection. I hope that all right hon. and hon. Members do so during the passage of the Bill. I hope that the Bill will also be the start of a greater focus on tourism by Government. Outbound tourism, which is the type of tourism that ATOL protects, has fallen between a number of Government stools for far too long, with split responsibilities between the Department for Digital, Culture, Media and Sport, the Department for Transport and the Department for Business, Energy and Industrial Strategy. It sometimes seems that this is a hot potato that no Government Minister wants to touch. I am grateful that the Bill has been introduced, because it is time to consider a single regulator for the travel industry and whether there can be a clear Department responsible for bringing together all the elements of outbound protection for holidaymakers.

We are very lucky to have an outstanding outbound tourism sector. I notice that nearly all Members who have spoken to date have praised their local airport. Plymouth’s airport closed in 2010. I implore the Minister to look again at how measures can be put in place to help us to reopen our airport in Plymouth so that I can join the cohort of Members who have praised their own airport. At the moment, my airport is growing grass on the runway. I hope it can open again soon, so that holidaymakers in Plymouth can enjoy the same protections that ATOL affords holidaymakers leaving other airports.