/ Travel & Leisure

Government must intervene in travel: my letter to Kelly Tolhurst MP

An airplane flying in cloudy weather

Travel firms have failed to provide timely refunds to consumers as required by law. I’ve written to Kelly Tolhurst MP, the Minister for Aviation, to urge the government to intervene.

Dear Minister,

We are writing to highlight our serious concerns about the failure of the travel industry to provide timely refunds as they are required to by law for package holidays and flight cancellations, and to call on the government to urgently intervene on behalf of consumers across the UK.

We continue to hear from people who are struggling to get the money that they are owed for cancelled trips – many of whom are facing financial problems of their own as a result of the crisis.

The industry’s own estimates from April 2020 suggest that up to ÂŁ7 billion in payments made by UK consumers could be affected.

Trust at a record low

Unsurprisingly, recent analysis by Which? found that consumer trust in the travel sector is at a record low, as many of the UK’s biggest airlines and travel operators are openly breaking the law by refusing refunds or failing to offer one within the required period.

We welcome the government’s public commitment to maintaining current consumer protections, however we are concerned that in many cases the existing law is not being followed.

The Competition and Markets Authority recently launched an investigation into package travel cancellations, however, there is an immediate action the government can take in relation to refund credit notes (RCNs).

We are aware that many travel companies are forcing customers to accept RCNs and vouchers in lieu of cash refunds.

While we support the use of RCNs where a customer chooses to accept one, there remains a worrying lack of clarity over the level of protection linked to them.

Now more than ever, it is vital that people can be certain that their hard-earned money is adequately protected against insolvency, so that consumers can confidently opt for RCNs where possible.

At the same time, the Civil Aviation Authority is also investigating airlines’ non-compliance with the law.

What happens as flights resume?

Despite not yet refunding passengers for cancelled trips due to take place as far back as March, a number of major airlines have announced that they will resume flights in the coming weeks.

Meanwhile, the government’s indefinite ban on non-essential travel remains in place, with a 14-day quarantine for UK arrivals recently introduced.

This contradictory approach across industry and the government will leave consumers confused as to the status of their upcoming holidays. Will they get a refund if they follow government advice not to travel but the flight still goes ahead?

Will they be required to pay the balance on a holiday that may be cancelled? Will they get a refund if they choose not to travel because they are unable to follow the subsequent 14 day quarantine period on returning to the UK?

How long would they have to wait for a refund? If they do travel, will travel insurance apply while the travel ban is still in place?

Government must intervene

With millions still waiting for refunds, those with future travel booked will also be unclear about whether they will be eligible to get their money back if their trip is cancelled.

As we approach the summer holiday period, it is clear that action must be taken to tackle the challenges specific to travel head on and to ensure that trust in the sector is not permanently damaged.

The government must urgently clarify whether RCNs offered for ATOL-protected holidays will also be covered by the ATOL scheme.

It must also clarify and coordinate its approach to supporting air travel to resume operating as soon as possible, ensuring that airlines and holiday companies allow flexible rebooking and cancellation options for those no longer able to travel.

Yours sincerely,

Anabel Hoult. Chief Executive, Which?

Comments
Chris Williams says:
23 June 2020

Bravo Which? and Rory Boland in particular for standing up for consumers. We know that this crisis is not of the industry’s making. But many companies have tried their very best to be fair to customers, often investing significant sums to make sure that refunds were made available. Others, though , have buried their heads and somehow hope customers will just accept a complete denial of their rights. I fear the point that you make about a permanent loss of trust has already happened for many hundreds of thousands of people.

If the regulators like CAA and CMA won’t act, and government won’t step in, I think there will be many hundreds of small travel agents – and quite a few of the larger ones – who will never recover from this loss of trust. And if the private equity or millionaire owners of some of these companies won’t inject capital, they deserve to go bust – and soon.

I am glad that Which? is following through on this issue and rolling out its biggest gun and pointing it at the Minister responsible for aviation.

I feel that the CAA has turned a blind eye to this growing scandal for fear of getting on the wrong side of the airlines and travel operators. It is the CAA’s scheme, administered under EU Regulations, but they have hardly been noticeably supporting it and enforcing it.

I think the role of ABTA also needs to be hit by the spotlight. In my opinion they have aided and abetted the avoidance – and in some cases the evasion – of the statutory requirements by the travel trade which has routinely stated that they were operating in accordance with ABTA recommendations. Only belatedly did their chairman make a statement clarifying that a refund must be provided if the customer requested one – but gave no imperative on the timescale.

I share Chris’s concerns [above] about the future of travel services as a result of the loss of trust. This would be a self-inflicted wound but the industry seems to have no sense of self-preservation. It exposes the underlying problem that they have been running on extremely thin margins for far too long and siphoned off the revenues that should have been put aside for a rainy day.

So long as people wish to travel and see the world – or have to for family or business reasons – there will be a travel sector, but if some of the present players pack up it might be no bad thing.

Some have said as holiday travel is a discretionary spend, those people cannot be in real need if their refunds are delayed, or vouchers offered. I don’t agree. Travel was booked when many people had money to spend in this way but with the unforeseen employment issues arising from COVID-19 this money may well now be needed for essential spending.

I wish Which? would apply the same sort of pressure to get refunds from Whirlpool when they are not providing the repair and replacement of washing machines and tumble dryers in a reasonable time.

I agree, Malcolm. The behaviour of the company has been unpardonable. Which? suggested that consumers should be able to claim for costs incurred when they were not able to use their dryers and this was widely reported in the press, but I am not aware of anyone managing to claim their expenses.

That certainly seemed to the attitude that prevailed in the travel industry, Malcolm. It overlooks the fact that the airlines and travel operators can only guess at the reason for people making a particular journey and that many of those whose flights were cancelled were travelling for important family or business reasons. Not all business passengers are travelling on a company ticket, and going to a wedding is not necessarily inessential.

I’d like to pay tribute to Jet2. We were due to fly to Tenerife on June 6th. On April 7th they emailed to say that my flight would not take place and that they would contact me further with options. On May 11th they emailed me with 2 options: amend my booking or request a refund. I didn’t reply immediately and the next thing I knew a further email arrived on May 15th confirming cancellation of my booking. On May 18th a full refund of ÂŁ884 appeared in my bank account. If Jet2 can do it why can’t others? We’ll definitely be flying with them again when things get back to normal.

Carol Oddy says:
27 June 2020

Well done Which? We had booked a holiday to Italy through Citalia, due to commence on 13th June. They have insisted that we accept a voucher which cannot be exchanged for a reimbursement until 31st January, over 7 months after the travel date. Although we have questioned this, and asked for a full refund, this request has been denied. They owe us ÂŁ2305 and I fail to see why our money should be held to keep a company in business for this long period when they have failed to deliver the service for which we, in good faith, have paid for.

Mike G says:
29 June 2020

It would have been good if the Which letter could have mentioned other forms of transport, too.
“What about ferries?”, asks a recent online Which article (https://www.which.co.uk/news/2020/06/coronavirus-outbreak-advice-for-travellers/#ferries), and then goes on to say, “If you’re booked on a ferry service that’s been cancelled, the provider is obligated to offer a choice between an alternative journey or a full refund.”
DFDS and Britanny Ferries, to name just two, are not providing refunds, just credit notes. But I wonder if ferries really must reimburse for cancelled ferries, or are they able to use the extraordinary circumstances clause Art. 20 (4) of the regulations on the rights of passengers when travelling by sea and inland waterway?
“Article 19 shall not apply where the carrier proves that the cancellation or delay is caused by weather conditions endangering the safe operation of the ship or by extraordinary circumstances hindering the performance of the passenger service which could not have been avoided even if all reasonable measures had been taken.”
A discussion of this by knowledgeable people would be helpful.

Tim & Suzanne says:
29 June 2020

Easyjet cancelled our flights just a week before departure. We were expecting them to be cancelled but not expecting the traps put in our way by Easyjet to try and make it difficult to request a refund. At every point in the process the layout of their webpages forces you to be careful where you click and you have to search for the route that will lead to the refund request actually being processed and acknowledged. One wrong click and you’ve requested a discount, vouchers, re-booking and then the acknowledgement tells you that EasyJet will try to refund you within 28 days but it may be 90 days!

Our refund request was acknowledged on May 11th……we not received a penny back yet.

Emily Hammersley says:
6 July 2020

My travel package holiday company is refusing to refund non recoverable costs. They do not dispute we had a package holiday booked, but they claim that due to the pandemic we’re NOT protected by the Linked Travel Package Regulations 2018 because under the The Law Reform Act 1943 our contract has been frustrated as thus they only need to refund recoverable costs, even though it is a package holiday. Talk about an assult on consumer rights! Has anyone come across this? What can I do?

Emily – That’s an interesting one. I can’t advise on what you can do because I think you will need some clear legal advice in a difficult and little-used area of law.

I had assumed that, under the frustrated contracts doctrine, there would be a chain of frustrated contracts in the circumstances you have described and that each party in the chain would be able to take release from each contract and be refunded appropriately so that your package holiday company would be able to recover payments already made to others. Where this arises in other jurisdictions could be the difficulty as the UK law will not apply.

Since many of the costs of a holiday are not actually settled by the organiser until after the holiday has been taken I am wondering if this is a fair interpretation by your holiday company or an expedient to avoid making refunds.

I hope a lawyer from the Which? Legal service might be able to advise on this one for you. I think in the first place you need an expert opinion on whether the company’s assertion that the Package Holiday Regulations are automatically disapplied is reliable.