Air Travel Organisers’ Licensing Bill

Debate between John Hayes and Kevin Foster

3rd reading: House of Commons & Committee: 1st sitting: House of Commons & Report stage: House of Commons
Tuesday 11th July 2017 Commons Chamber

[Mr Hayes]

What I actually said is that the Air Travel Insolvency Protection Advisory Committee, which is missioned to consider these matters in the way I described, will doubtless take account of the contextual changes associated with our independence from the European Union, and I use the word “independence” advisedly. It is inconceivable that the committee would not make reference to that in its annual report, but I also said that I would write to draw the committee’s attention to the specificity of the measures we are bringing before the House to ensure that it carries out the very kind of report and review called for by the amendment.

[Kevin Foster (Torbay) (Con)]

Will the Minister give way?

[Mr Hayes]

I really must press on.

Appendix 4 of the annual report is categorical about the committee’s constitutional role, and it sets out the committee’s membership, which includes the Association of British Travel Agents, the Association of Independent Tour Operators, the Association of Airline Consolidators, the Board of Airline Representatives in the UK and the Travel Trust Association. The committee also includes up to 10 independent members, of whom one will be the chair. Of course, as I set out earlier, the committee’s independence and expertise mean that it is in a perfect place to do the very work that the hon. Member for Kingston upon Hull East perfectly properly recommended to the House and that the amendment seeks to achieve.

Therefore, in the light of the fact that the Government have already obliged in law to review legislation within five years and have set up the independent panel of experts to report; that I have committed to seek guidance on the important issues the hon. Gentleman raises and to write to that committee asking it to review the legislation; and that the committee will report more often than annually as necessary, it would be extraordinary if the Labour party pushed this matter to the vote. It would be unreasonable for it to do so, but in the end that is a matter for it, not for me.

Air Travel Organisers’ Licensing Bill

Debate between John Hayes and Kevin Foster

2nd reading: House of Commons
Monday 3rd July 2017 Commons Chamber

[Mr Hayes]

My hon. Friend might have raised that point in that Committee; my memory is good but not encyclopaedic, but I do seem to recall that he has made this point previously. He is both authoritative on matters regarding transport, having served with distinction on the Select Committee, and consistent in his line of argument. His is a perfectly fair question, and it is what the Opposition and the whole House would expect, so we will provide as much information as we can about what further steps we might take in terms of regulation. There is nothing to be hidden here; there is no unnecessary contention associated with this and certainly no desire not to get this right, and the best way of getting it right is to listen and learn—as is so often the case in politics, in Government and in life.

I have talked a little about the diversification of the market and the growth of the internet and smart technologies. That is not a bad thing: consumers now have many options at their fingertips to buy holidays and put together their own packages. Indeed, an ABTA survey estimates that about 75% of UK consumers now book their holidays over the internet. As methods of selling holidays modernise, we must adapt the schemes and regulations that protect them.

“Quality is never an accident; it is always the result of intelligent effort”,

as Ruskin also said. That is why we took steps in 2012 to update the ATOL scheme; we introduced the ATOL certificate confirming the protection covered, and broadened the scope of protection to include “flight plus” holidays. These interventions have had a positive impact, extending consumer protection, levelling the playing field for businesses and improving clarity for all. The key here is that consumers know when and how they are protected: making sure the system is as comprehensible and comprehensive as possible is an important aim.

We now need to build upon the changes we made then, and make sure that ATOL keeps pace with the changing travel market. In particular, the new EU package travel directive was agreed in 2015 to bring similar, but further-reaching, improvements to consumer protection across the whole of Europe. I said earlier that the United Kingdom had led the way in this field. It is not unreasonable to say that Europe is now saying it wants similar provisions across other countries to the ones we have had here for some time. So that travel directive is both reflective of, and perhaps even, to some degree, inspired by, the success of our arrangements. This will need to be implemented into the UK package travel regulations by 1 January 2018.

The Government supported the rationale for updating the package travel directive. It will help to modernise and harmonise protection across Europe. Broadly, it will mean that the protection offered across Europe will be closer to the protection we have enjoyed from the beginning of ATOL, but most especially since the changes we put in place in 2012. It will ensure there is a consistent approach to the protection.

[Kevin Foster (Torbay) (Con)]

The Minister is giving an interesting and full explanation of the benefits of this Bill.

Will the Minister clarify that the point is that the ATOL regulations currently apply to first-leg flights out from the United Kingdom and a UK airport, but that under this Bill the intention will be that in future if a UK ATOL-regulated operator sells a package virtually anywhere in Europe, as long as they comply with the rules here, that will be covered by the ATOL scheme and the potential levy?

[Mr Hayes]

Yes, that is part of what we aim to do: the aim is to ensure that if a holiday is bought here, wherever the person goes they are protected in exactly the way my hon. Friend described. He is also right to say that part of the change is the way people book and make their holiday plans, and part is about how and where people travel. The package holidays people first enjoyed in the 1960s and ’70s are less routine now in that they are no longer the routine way people travel to the continent and further afield, and ATOL was of course born in that period when things were simpler—thus my point for the need for it to evolve, as it has to keep pace with these kinds of changes. That consistent protection of holidays across Europe will ensure that informal package holidays booked online will get the same protection as traditional package holidays booked on the high street—holidays of the kind that had their beginnings in the ’60s and ’70s.

For the first time, these measures will also bring protection to a new concept of “linked travel arrangements”, which I think is what my hon. Friend was referring to. This concept is designed to provide some protection to business models which are not packages, but which often compete closely with packages.

Overall, the new directive has the potential to provide a greater level of protection to UK consumers, whether they purchase from a company established in the UK or overseas. It will also help to level the playing field for companies whether they are in the UK or overseas, and whether they operate on the high street or online.

That point matters in itself. This is about protecting consumers, and about the clarity and comprehensibility that I described. It is also important for those in the travel sector and the industry to know where they stand. Creating a greater degree of consistency for them matters too, particularly for smaller businesses that really need to know, as well as to feel, that the regulations apply across the board in a consistent, fair, reasonable and implementable way.

In order to bring the new directive into force by July 2018, the four clauses simply enable the ATOL scheme to be aligned with the updated package travel regulations. The combined clauses will mean UK-established companies are able to sell holidays more easily. They will be able to protect these holidays through ATOL, and they will not need to comply with different schemes in each country. That is the essence of what we are trying to achieve today. The Bill will also extend the CAA’s information powers so that they are more able to regulate the scheme and this cross-border activity.

Finally, the Bill will allow the scheme to be able to adapt more effectively to changes in the travel market. I have said that I anticipate further change as time goes on, and the Bill paves the way for that. Overall, the updates we will make to the ATOL and package travel regulations will mean that consumer protection can extend to a broader range of holidays. This will mean that protection is provided for traditional and online package holidays, but also for looser combinations of travel, which have previously been out of scope.

Of course, we also need to be mindful that the regulatory landscape will need to be able to adapt to changes in our relationship with the European Union. The changes we are making are in keeping with this principle. They will help UK consumers, businesses and regulators to transition to the new package travel regulations in 2018 with minimal impact, but we will also retain flexibility in ATOL regulations to adapt to the changes in our relationship with the European Union, ensuring that we continue to have strong consumer protections in place as we leave the EU.

I hope that that has given a clear and reasonably concise picture of the Bill and the reasons for introducing it. As I have said, the UK has always been a leader in this field. We have led in so many ways and so many areas, and when it comes to providing protection for holiday makers, the Bill will ensure that the UK continues to lead, whether we are inside or outside the EU. It will provide UK businesses with the opportunity to expand and grow, and it will provide a framework to ensure that ATOL remains flexible enough to cope with future trends. The Bill is indicative of a Government who are willing to act to protect and preserve the people’s interests, and I stand here as a Minister ready to do that. It is a Bill for the people from a Government of the people.