/ Travel & Leisure

Consumers should not have to prop up the travel industry

We don’t want to see the travel industry suffer further as a result of the pandemic, but it cannot be on consumers to prop up airlines and travel firms. Here’s why.

Why have Business Secretary Alok Sharma and Transport Secretary Grant Shapps remained silent over the scandal of travel firms denying refunds for coronavirus holiday and flight cancellations?

For nearly seven weeks since international travel was shut down, airlines and some tour operators have been hoarding billions of pounds in customer payments for holidays that are no longer happening – effectively interest free loans to get them through the crisis.

Most British holidaymakers are protected by legislation that entitles them to a refund within seven days for a flight or 14 days for a package holiday if their trip is cancelled.

Yet we found 20 of the biggest airlines and tour operators breaking the law by delaying or denying refunds. Many are doing it brazenly and in plain sight. And they’re getting away with it, with barely a peep of protest from the government or the regulator, the Civil Aviation Authority.

No-one wants to see these businesses collapse. Millions of us rely on them to help us get away for what might be the most enjoyable and relaxing week or two of our year.

But that does not mean it’s acceptable for millions of families and other travellers – who may be facing serious financial problems of their own due to coronavirus – to fund the travel industry through this crisis.

Your stories

We’ve heard from people out of pocket by more than £10,000 on a holiday of a lifetime and others who really need their £150 flight refund so they can pay this month’s bills. Many are understandably concerned about whether they will ever see their money again.

 
 

We’ve seen holiday companies wrongly telling customers that consumer protections have changed and they are no longer entitled to a refund. Some are forcefully pushing vouchers and credit notes on customers – even though these may prove worthless if the provider goes bust.

The major airlines have hardly covered themselves in glory. They are withholding money from their passengers, and also from holiday companies that need the cash to refund their customers.

British Airways passengers have been infuriated by the airline taking refunds offline and asking them to ring a phone number that plays a recorded message before hanging up on them. 

Ryanair customers have been bombarded with vouchers – even after making it crystal clear they are only interested in a refund. The airline has been through several iterations of its refund policy during the pandemic.

All of them have had one thing in common: no-one actually seems to get a refund.

People are also finding they are out of luck when they turn to their insurer or card provider in a last-ditch effort to get their money back. Insurers say the holiday firm or airline is responsible.

Some banks are rejecting debit or credit card dispute claims, leaving people wondering if anyone will help them.

In short, it is an unholy mess. And it’s not going to get better without urgent government intervention.

Support the industry, protect consumers

We’ve produced a 10-point plan for supporting the industry and protecting consumers – so that airlines and holiday firms can weather this storm without neglecting their legal obligations to customers.

We have shared it with the government and MPs on Parliament’s Transport Committee, who will be questioning industry representatives this morning.

The airlines hold the key to getting the system moving again and we believe ministers and the aviation regulator must start getting tough with carriers that are breaking the law or playing fast and loose with the rules.

Our proposals also include a temporary extension of the 14-day statutory refund period for package holidays to a maximum of a month, because we know operators face a challenge to process so many refunds with fewer staff available – but a cash refund must still be an option for those who want it.

The government must guarantee that the refund credit notes being offered instead of cash refunds are insolvency protected. But even with that reassurance, many will still want a refund and we have concerns that some firms are simply not in a position to honour their obligation to pay up.

That’s why we’re also calling for the creation of a temporary Government Travel Guarantee Fund, which would support holiday companies ordinarily in good health that are struggling to fulfil their legal responsibilities due to coronavirus cancellations.

The actions in our plan, taken together, are necessary to secure a return to a thriving UK travel sector as coronavirus restrictions are gradually lifted.

But unless action is taken now, there is a real risk of permanent damage to consumer trust and confidence in the travel industry. 

Comments
Jenks says:
6 May 2020

I was having problems with BA until it was announced that the government support package to business was finally kicking in. That week the refund line opened up to receive calls and the refund came through very promptly. It’s all very well government announcing huge support to business but when it takes well over a month for the money to be made available it is not altogether surprising that businesses delay until it actually comes through. I have left the deposit with the hotel I was planning to use against a holiday next year but they have offered a 15% upgrade on the amount paid against using it then. Very impressed with the Alhambra in Granada who refunded the ticket price as soon as the tickets weren’t used direct to the credit card – I didn’t have to do anything except look at their website.

Mrs Sally Day says:
6 May 2020

I booked with Shearings A Coach package holiday in Tenby for 11th May 2020 to 15th May 2020.
This was cancelled by Shearings due to the Virus. I had booked for my friend and my self on the 30th Dec 2019 paid the deposit and paid the rest on the 16th March 2020 £620.00 They wrote saying it was cancelled on the 6th April no cash refund but sent a credit note to be used by 31st July 2020 for a holiday up to 31st Dec 2021. I replied say this was not suitable we wanted a cash refund within 14 day and no credit voucher . Reply back gave me a case number said they would reply in 28 days or less. On the 28th day they sent another Credit note for the same amount asking me to book another holiday and no cash refund.
We need the money and do not want to rebook we are getting older and who knows what will happen in advance. We want a cash refund now of £620

Jemma123 says:
6 May 2020

We booked a holiday with TUI and after two phone calls saying we would be refunded, but with no funds back into our credit account, we rang again the third time to be told ‘it was being processed by their accounts team, but they had no idea how long it would be’. I get the feeling we are just being taken on a ride so have contacted our credit card company. I will never book a holiday with any of these disreputable companies again, so please everyone keep shaming them. Also a heads up for Premier Inns, brilliant job guys, got my money back in 7 days. Same to the Isle of Wight Festival and Wightlink Ferry, So please mention the good guys as well so we all know who to go to when this is over. Stay safe everyone.

Marion says:
6 May 2020

Praise for Hoseason’s. Have a holiday booked with them in July. Booked it last July with a £25 deposit. Was supposed to pay the balance (£490) on May 2 but have been contacted by them to say I don’t have to pay the balance until 3 weeks before the holiday. If I want to cancel before then I will only lose the £25 deposit.

John says:
6 May 2020

I booked two flights with EasyJet for my family of four to fly down to my Villa in Portugal at Easter and the half term holiday in May. Both these flights are the most expensive time to fly. I am still trying to obtain a refund of just under £4,000 but absolutely no luck with Easyjet and I’m waiting for HSBC to comeback to me regarding chargeback. What makes this even more upsetting is hearing that Easyjet have handed something in the region of £174 Million pounds out in dividends to their Directors / Shareholders etc only a few months ago. The Government has to step in here this behaviour is unacceptable and is corrupt. You could never trust these airlines again.

Perish the thought, but is it at all conceivable that the holiday companies believe that because their clients were willing to splash out hundreds or thousands of pounds on a holiday – and would have nothing to show for it afterwards – they don’t actually need their money back if the holiday has to be cancelled because the government has banned non-essential travel? Clearly, the fact that many people have had their lives turned upside down by this crisis cuts no ice.

Sylvia Hebden says:
7 May 2020

When I booked our river cruise last September with SCENIC, I also took out insurance with EXPLORER INSURANCE. Scenic have re-booked us onto the same holiday for 2021 and also given us a free upgrade.
I have Emailed Explorer twice requesting details of our insurance cover in this regard, but have not received an answer. Surely we should be allowed a refund or a transfer to 2021?

Andy Grounds says:
7 May 2020

We have now our third annual travel ins policy from SAGA that we paid £691.42. With 10 months remaining on the policy we will not use, we asked for a pro-rata refund for the unused cover, they refused quoting terms & conditions, 14 days etc, They are keeping our plus £500 for cover they will not have to provide. I don’t think l will be doing any more business with them! Others l hear are giving refunds! Do you have any advice that cuold help us?

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Susan says:
7 May 2020

My daughter, her son and I booked seats with Norwegian Air to San Francisco to travel in April. Norwegian Air contacted us to ask if we wanted to have our money back, vouchers or another flight. We chose the money and with no trouble at all it was refunded. Full marks to Norwegian Air.

Paul Brown says:
7 May 2020

We had flights booked to Tenerife in March with Jet2. Flight cancelled as expected and a refund to our credit card made within a week or so without doing anything except look at info on their website. Usual good customer service from Jet2

I can understand the pressure that the various company’s are under but the law is the law.

Hugh says:
7 May 2020

While I would not want to deny families their annual holiday in the sun, it is a fact that frequent air travel is one of the major contributors to climate change, with no prospect of any mitigating technology in the foreseeable future.
If we allow the airlines to resume ‘business as usual’ after the current crisis we will be jeopardising the futures of our children and grandchildren!

John Mackenzie says:
7 May 2020

Booked a holiday with Tui for all my family( 8 of us and 2 grandchildren) for my 60th birthday present to all my close family 18 months ago .Was due to fly on the 24th of March, booked with TUI at Gerrards cross shop called us 2 days before we were due to fly and said it was cancelled due to the Coronavirus.
Ok that was fine ,they told us over the phone that we would get a full refund almost £26,000 within 10 days
They took our bank details,then we got a confirmation letter a few days later saying the same thing .
We are still waiting for our money today ( 7th May ) we have heard nothing from Tui ,no call no letter absolutely nothing .
Can not call them shop shut ,cannot get through on phone, we held 0n for over 3 hours then got cut off ,no email address to send too ,they have been taken down.
Customer service from TUI ABSOLUTELY DISGUSTING!
Would NEVER book another holiday with TUI ever again neither will my son and daughter and hopefully my grandchildren this has caused a major financial strain on us during this time .
ABSOLUTELY TERRIBLE

James Green says:
7 May 2020

Help…Booked a package holiday to New York through Expedia….they have contacted us to say that the accommodation has informed them that our booking has been cancelled due to the coronavirus pandemic…
and that we will be fully refunded…would this automatically mean that we would also get refunded our flight costs which are with Virgin Atlantic (in the same Expedia package)…even though on the Virgin flight schedule site it is still stating that the flight is still on going….help…

Elwyn Williams says:
7 May 2020

We booked a holiday to Russia by a travel company, through a travel agent. We were due to leave on 28th April.
When it was cancelled we contacted the travel agent regarding the refund. They informed us that the company organising the trip were only issuing vouchers for holidays with them in the future. The vouchers would be valid until November 2021. If we hadn’t used them by that date a full refund would be given.
We contacted both the travel agent and travel company advising them that this was not acceptable and that they had to refund the full amount. After many phone calls to both the agent and the company stressing that we would not accept, and spelling out our rights, a full refund has been given. This was mainly due to the agent pushing it on our behalf.
Just keep persevering, make a nuisance of yourself, stress your rights. It should pay off!!
I have my own business and I understand, in this extreme situation, why the travel companies need to hang on to our money to survive. However that is not our problem. They need to get themselves organised to cover this sort of eventuality.

Mike says:
7 May 2020

Had a river cruise holiday booked with Avalon waterways (part of the Cosmos group) for May 2020. Avalon cancelled the holiday in April and offered a credit note for a future holiday. We decided we would prefer a refund and advised Avalon. We received a full refund within 14 working days. Our insurance company Holidaysafe also refunded the major part of the premium as we could not travel. There are companies out there doing the right thing.

Cej Burgess says:
7 May 2020

While I understand the pressure companies are under the money we have committed to our honeymoon was a most significant sum. It’s bad enough having our wedding postponed, but this is adding to stress and upset.

I don’t want to see any business go under, but the money is ours and is needed by us. A voucher would probably have been acceptable if we could be assured that its value would be enough to get the honeymoon we wanted but no one is sure what the cost of travel will be after the virus is brought under control. Similarly, we are concerned that we will not be able to insure this expenditure.

If companies has acted swiftly and kept to the rules, the public would have been far more trusting, but with their procrastination and the difficulties in getting a straight answer it’s not surprising people, us included, simply want what the rules dictate we should have – our money back.

It is time the government intervened as rules are there for a reason.

Travel has always had a higher degree of risk than other activities but the industry does not seem to have prepared itself to deal with emergencies satisfactorily. Good profits have been made over the years by well-run companies but they have been paid out to investors rather than invested in resilience, contingency reserves and working capital. There has also been an unrealistic race to the bottom in the provision of overly-cheap flights and accommodation leaving no margin for problems.

Whether it’s earthquakes, tsunamis, volcanic ash clouds, terrorist outrages, wars, floods, strikes, and now a pandemic, there has always been some disaster affecting people’s travel. It really is about time the travel businesses recognised that it’s not all plain sailing and provided enough staff, facilities and systems to handle emergencies. For an industry that’s in the business of making dreams come true, why is it always giving us nightmares?

Bev says:
7 May 2020

Was due to travel on 17 March, on a holiday booked with Imagine Cruising. Trip cancelled by them on Saturday 24 March. No refund yet. Most recent correspondence from them, dated 1 May advices that my money (significant sum) is safe. Also states that the European Commission responsible for relevant regulations has advised member states to find “flexible solutions” (their speech marks) to the natural increase in demand for refunds during this crisis. Imagine Cruising are apparently following ABTA guidance and have issued refund credit note. At no time have they asked if I want or need a refund, they have just made up the rules as they see fit. Apparently the refund credit note gives me 3 options. The first is to book an alternative holiday departing in 2021, the second is to retain the credit note towards a new booking, but advices that I must use it by 31 December 2020. The third option states: if either of the above options are not suitable, you will be entitled to a refund. It goes on to state that I must be aware that this may take many months before being processed . It is apparent that the earliest start time for the refund process to commence is 60 days after the date of travel. I look forward to what they say after 16 May 2020!!

Carolyn says:
7 May 2020

Do not the holiday companies – airlines or coach or rail have Insurance themselves to enable customer refunds – if not why not

Exactly, Caroline.

Unless vouchers and other deferred benefits are bonded they are not worth much in the turbulent business climate we now have.

The CAA – which has been somewhat supine on refunds – is now warning that vouchers are usually not secured and might not give the protection to travellers that the ATOL scheme is meant to provide in the event of company failure.

Carolyn – I apologise. I misspelt your name in my comment above.