Travel firms accused of ‘fleecing parents’
Education secretary Michael Gove has accused travel firms of ‘fleecing parents’ by ‘ramping up prices at certain times of the year’.
He said schools had to be understanding and flexible when setting holiday dates but added it was wrong to take children away when they should be in school.
Gove said: "My own view is that the holiday industry needs to look at itself in the mirror and ask is it doing enough?"
The comments came as MPs debated price regulation in Westminster following an e-petition signed by almost 170,000 people concerned about holiday companies ‘cashing in on school holidays’.
While no MPs backed price regulation, term staggering received widespread support.
Consumer affairs minister Jenny Willott said staggering holiday dates could "help bring prices down" and that by 2015 all schools would have the power already given to free schools and academies to set their own dates.
She added: "The government is not convinced higher prices in school holidays are as a result of market abuse by the holiday industry, but rather they reflect the market forces in a very competitive sector."
Liberal Democrat MP John Hemming, who requested the debate, said price capping was not a "practical solution", and a plan to suspend Airport Passenger Duty in the school summer holidays was "not a flyer", reports the BBC.
Travel pricing expert James Brown, partner at Simon Kucher & Partners, said: "For the public, any government regulation restricting prices during half-term or school holidays could very likely lead to higher prices outside these dates, to allow companies to "re-coup" their lost profitability.
"This is an industry with tight margins where bankruptcy is a real threat – you only have to look at recent failures of Goldtrail, Kiss and Sun4U. A cap on holiday prices would impact the industry’s profitability, increasing the risk of insolvency.
"Not only would it lead to unemployment but a more consolidated market would mean less competition and therefore less choice and more expensive holidays for consumers."
Thousands of fines have been issued to parents taking children out of school during term time since the rules changed last September saying headteachers can only grant time off during term time in ‘exceptional circumstances’.
Previously parents could be allowed to take their children out for up to 10 days per academic year.
Ms Willott said the change in September was simply a "clarification" to remove the "misconception" that parents were allowed to take their children out of school for 10 days a year.
Over eight out of 10 travel companies have been financially impacted since the Government implemented restrictions on term-time family holidays.
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Diane
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