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Holiday protection not strong enough: MPs

By Simon Calder

MPs have criticised reforms aimed at strengthening consumer protection for holidaymakers which come into force today, warning that they don't go far enough.

The Transport Select Committee says the Civil Aviation Authority's beefed-up Air Travel Organiser's Licence (Atol) scheme to financially protect travellers does not pay attention to holidaymakers' views.

A further six million travellers will be protected under the new terms of the scheme. The original licence covered travel firms selling air holiday packages and flights in the UK. The CAA's new scheme, called Flight-Plus, extends Atol protection to arrangements that look like package holidays.

The cover now applies when a flight and accommodation are requested from the same vendor on the same day, or on successive days. The Government says the proportion of foreign holidays covered by the Atol scheme will rise from four to six out of 10.

In a report out today, the committee concludes that the changes do not take account of “consumer behaviour and views”, and that the flat fee principle introduced by the CAA is “unfair”.

Twenty years ago, before low-cost airlines such as easyJet and Ryanair transformed the travel landscape, the vast majority of British tourists took traditional package holidays, with flights and accommodation bought simultaneously through the same company.

They were covered by the Atol scheme, providing repatriation and refunds if a tour operator failed.

Today, fewer than four in 10 British holidaymakers heading abroad are covered. The collapse of companies such as Goldtrail, Kiss Flights and XL have exposed the inconsistencies and customer confusion about who gets a refund when a travel firm goes bust.

The Transport Select Committee describes the previous scheme as “a mess”, and welcomes the “greater cover and clarity” the new rules promise.

Affected holidaymakers will each pay a £2.50 — regardless of the cost of the package deal — ‘Atol protection contribution’. In a full year, this is expected to bring in an additional £15m, helping to plug the £42m hole in the government-backed Air Travel Trust Fund, which was hit by a number of high-profile collapses.

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