ABTA hits out over plan to triple £1 ATOL levy
Calls for reform of the ATOL passenger protection scheme are likely to gather pace after plans to triple the industry levy to £3 were outlined.
The Civil Aviation Authority wants the ATOL Protection Contribution by tour operators to be raised from £1 to £3 per passenger from October 1.
This “offers a reasonable balance between setting the rate as low as possible while providing resilience in the current period of economic uncertainty,” the CAA said while announcing the start of a consultation process into the rise.
The authority sought to justify the suggested hike by saying the fall in air passenger numbers and the failure of XL Leisure Group last year have brought about the need for changes to the rate of APC.
“Previous industry bookings estimates, on which the current APC rate was based, are forecast to drop significantly as a result of the recession, directly affecting the income of the Air Travel Trust Fund,” the CAA said.
“In addition, the failure of XL, which was the UK’s third largest tour operator when it collapsed in September 2008, has affected forecasts of ATTF expenditure.”
But ABTA chief executive Mark Tanzer hit back, saying: "We have made clear to the Department for Transport and the CAA our members’ frustration and disappointment at the prospect of an increase in APC, so soon after it was launched at the rate of £1 per passenger.
“We shall be actively consulting with our members to understand the reasons for the proposed increase, and what this means for the future viability of the ATOL Scheme.
“It remains our conviction that broader reform of the ATOL Scheme is long overdue, and we shall be urging this point through the consultation process."
The CAA’s consumer protection director Richard Jackson said: “ATOL offers consumers peace of mind and comprehensive protection. It is therefore in the interests of holidaymakers that the CAA takes action to strengthen the ATOL Scheme so it has the resilience to meet the challenges that face the travel industry and to continue to protect people during the current economic downturn.
“We are also pleased that the Government has given some initial thought to what options may be considered to further clarify protection for consumers.
Formal consultation on increasing the APC rate will run until June 12 with a decision by the transport secretary in the summer.
by Phil Davies
Phil Davies
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