Package Travel and Linked Travel Arrangements Regulations 2018

Lord Stevenson of Balmacara Excerpts

Wednesday 16th May 2018 Grand Committee

[Lord Snape (Lab)]

My Lords, I have no personal interest to declare on this matter though, as a fellow of the Institute of Travel and Tourism, I have some degree of affection for the subject before the committee today. Having been appointed way back in 1992 as a transport spokesman in the other place, I think it was the first directive I actually dealt with from the then Opposition Front Bench. As far as I remember, it amounted to about five pages in those days. It included the Explanatory Memorandum. It is a measure of how far we have come—whether forwards or backwards I leave to the Committee to judge—that the legislation before us is 41 pages with a 47-page impact assessment. As the noble Baroness, Lady Randerson, said, things are a lot different these days compared with 1992. In a way, the Minister was being too modest when he talked about the Government’s involvement in this package. I do not often find myself in a position of praising Ministers and accusing them of undue modesty, but it is true to say that the British Government have led the field, as far as the EU is concerned, on consumer protection in this area. The Government should be commended for that.

There are three main advantages to the instrument: as has been said, it widens the definition of a package holiday; it will enable British companies to sell across the EEA; and it guarantees repayment if any aspect of a holiday package fails. Will the Minister confirm that the implementation date is July this year? He might have said that in his speech. If he did I beg his pardon, I missed it.

Although the industry feels that there could and should have been a little more time for consultation, it appreciates the consultation that has already taken place. Indeed, I spoke to Mr Steven Freudmann, the chairman of the Institute of Travel & Tourism, about this legislation a few days ago. He expressed his view on behalf of a substantial chunk of the travel industry that this legislation goes a long way to increasing consumer protection and is to be widely welcomed.

As far as the linked travel arrangements are concerned, praise ceases there. Indeed, when I read and reread the linked travel arrangements I was, like the noble Baroness, completely baffled as to what it meant. Indeed, I was so baffled that I got the ITT to pass me the name and telephone number of a lawyer who specialises in these things. I rang him with some trepidation. Noble Lords will be aware that ringing lawyers is never a very wise thing to do. It is inevitably followed by a whacking great bill that makes the bank manager blanch, but on this occasion the information I requested came gratis.

I hope I can go some way to addressing the noble Baroness on the situation she outlined. Having booked one aspect of a package holiday, namely the flight, she asked whether other aspects booked separately were covered under the legislation. My point to the Minister and the noble Baroness is that as far as I can see, and as far as the legal advice I have had is concerned, no part of the package is, in fact, covered other than the first part. If she makes a mistake, if that is the right term, in booking the flight and then returning to book a hotel, hire a car or whatever subsequently, that aspect of her package will not be covered under the legislation. I am sure the Minister will be able to tell me whether I have that right or wrong, but it indicates a weakness in the legislation. If we are to have these welcome packages that assist holidaymakers and package bookers, it is of some concern that the difference in treatment is not immediately apparent between those booking their package straight off and those booking parts of the package, albeit at the same time.

I repeat that there appear to be no benefits as far as the second service is concerned. I would be grateful if the noble Lord will tell us whether we have it right. If we have, what is the department prepared to do about it? The travel industry generally welcomes the legislation and the proposed consultation. I ask the Minister to see that the travel industry is properly consulted if any difficulties arise and that its views are heard following the implementation of the directive. It is welcome, with a caveat about the weakness of the linked packages and the baffling nature of the legislation which, quite frankly, I did not understand. I am sure that the Committee, like the travel industry, will give a cautious welcome to this legislation.

[Lord Stevenson of Balmacara (Lab)]

My Lords, I thank the noble Baroness, Lady Randerson, and my noble friend Lord Snape for their comments. They have eased the amount of ground I have to cover because they have raised issues that I would otherwise have dealt with.

Although I welcome the regulations, I join the noble Baroness, Lady Randerson, in saying how confusing they are—certainly the latter part on travel arrangements. However, I am comforted by what my noble friend Lord Snape said, not least because he is on my side for a change. Normally when he speaks in debates, he attacks me from the Benches behind, but this time we are on the same page and singing from the same hymn sheet. We think that these regulations will do a lot for consumers and we are grateful for that.

[Lord Snape]

I apologise for interrupting my noble friend but I have never actually attacked him; I have merely tried to give him some helpful guidance.

[Lord Stevenson of Balmacara]

That is what I meant. Perhaps I may deal, first, with the date of implementation, which I am sure will be entirely in line with the Minister’s expectations. This measure has been in genesis for a number of years. We knew that it was coming from about 2015, so waiting until 1 July 2018 to implement it seems rather like an overabundance of time, and I wonder whether the Minister will comment on that.

Secondly, why implement this measure in the middle of the holiday season? Changing the regulatory structure and the information for consumers bang in the middle of when they will be taking their holidays is an extraordinary thing to do and does not seem very sensible. It is certainly odd that the expectation was that the regulations would be implemented no later than 1 January 2018, although a six-month extension was allowed. However, we have managed to do it on the very last day possible, which, as I said, is not at a very convenient time, and I would be grateful for the Minister’s comments. I point out to him that, having heard his exhortations to himself to try to do better, we are now in a situation where only one of the last 10 SIs has been implemented on the common commencement date, and even for that one it was the wrong common commencement date. I look forward to a positive response on how performance will improve.

Having said all that, I thought that the Explanatory Memorandum was terrific and I congratulate the civil servants on what they have done. I read it with great interest right the way through. It was convincing and covered all the points that I had in mind. They did a very difficult job very well. It is a very complicated area. I am not complaining about the complications; nevertheless, work was done to try to come up with figures reflective of the changes, and I thought it was very good.

However, what I missed in the regulations was the complementarity of the effect that they will have on consumers. These are the Package Travel and Linked Travel Arrangements Regulations 2018, but they are not to be taken separately from the negative instrument. That instrument will be brought forward by the DfT but I am afraid I could find nothing about it. That may be my fault but I understand that there is to be another regulation which is not under the control of BEIS and therefore BEIS will not be answerable for it. However, as someone who is interested in this area, I, and certainly consumers, would have found it very helpful to have both measures together. I do not know whether the Minister can comment on that but perhaps he can arrange for me either to be informed or to be sent a copy of the negative instrument so that we can see both sides of the story.

The negative instrument, which is coming from the Department for Transport, provides the answer to a number of questions around whether flights booked separately form part of a package. The regulations that the CAA is responsible for come into force because of that instrument and not this one. I think that this is covered in detail in paragraph 4.6 on page 2 of the Explanatory Memorandum. The Air Travel Organisers’ Licensing Act 2017, which was given Royal Assent in November 2017, is the founding legislative form for that.

The other thing that I wanted to pick up was the question of guidance. There are two aspects to that. First, there is the question of how consumers will work out how this is. I would be interested to hear more comments from the Minister on that. Secondly, there will clearly need to be guidance for those in the business who actually operate this stuff. On page 5 of the Explanatory Memorandum, paragraph 9.1 says that BEIS,

“will issue non-statutory guidance for business on their responsibilities under the new Regulations at the same time this instrument is laid”.

As we heard, it was laid on 16 April so presumably that guidance is available. I would be grateful if the Minister could make sure that we get a copy of that as well. I would like to read what is being said by the department to businesses.

--- Later in debate ---

[Lord Henley]

I thank all three noble Lords for their comments on these regulations. In summary, I think all three were saying that they welcomed them but that the regulations were somewhat on the complex side and they needed some explanation and guidance. The noble Lord, Lord Snape, gave from his own history the example of the first SI that he dealt with in opposition, many years ago back in 1992. He and I do not have to remember it but that legislation was only five pages long and these regulations are somewhat longer. The first thing to say is that things have got more complicated. As the noble Lord knows, the way we buy things has got much more complicated than it was some years ago. The old, simple package holiday is no longer there; we all buy things in a completely different way.

The noble Baroness, Lady Randerson, gave an example of the way that, as families, we sit down in front of the computer and say, “Right, let’s get a flight”. We take many more short holidays and may suddenly think, “We’ve got a long weekend—let’s get a flight”, then up jumps the offer of car hire, hotels and other things. In a sense, we create a package. For that reason, things will obviously be more complicated when putting together the regulations. It is therefore quite likely that they will have to contain more than the five pages that the noble Lord, Lord Snape, remembers so well.

[Lord Stevenson of Balmacara]

I am sorry to interrupt the Minister but is not one of the Government’s aims here to make sure that people who buy things digitally have the same rights and experiences as those who might walk into a shop and buy them on the ground? I think the point that the noble Baroness, Lady Randerson, was making is that it is actually not being replicated here. There is not quite the same sense of buying, in a shop at a particular time, the package—even though it comes in slightly different forms. That is the issue which is causing concern.

[Lord Henley]

The noble Lord is quite right to highlight that as an issue. The point to make is that when you are buying something slightly different, as a package, it will be quite difficult to put together exactly the same regulations as those remembered so fondly by the noble Lord, Lord Snape, which covered only five pages. To try to give the same sort of coverage when something so completely different, which did not exist in the past, is being bought necessarily makes for more complicated regulations. It is not that we have become more verbose since 1992. It is just harder to do these things.

I was going to offer some thanks to the noble Lord, Lord Stevenson, for his thanks for the Explanatory Memorandum. It is very rare that we get praise of that sort but we are grateful for it.