Draft Package Travel And Linked Travel Arrangements (Amendment) (EU Exit) Regulations 2018

Patricia Gibson Excerpts

Tuesday 4th December 2018 General Committees

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

Thank you, Mr Hosie; it is a pleasure to see you in your place. My remarks will be brief.

The statutory instrument brings welcome consumer protections, but the Minister will be aware that it does nothing to reverse the loss of income that Brexit has meant and will continue to mean for holidaymakers, should it go ahead, which is becoming less clear with every day that passes. I say that at the risk of raising the ire of Government Members. It seems to me that the only thing that is clear is that Brexit is unclear.

Mark Carney, the Governor of the Bank of England, told the Treasury Committee that

“real household incomes are about £900…lower than…forecast in…2016.”

The question is why, and what drove that difference. Some of it, according to Mark Carney, is ascribed to Brexit. I crave your indulgence for just a brief second, Mr Hosie. Alongside what Mark Carney notes, there has been a decline in real wage growth since the Brexit referendum, largely fuelled by persistent inflation, which has been above the 2% target each month since February 2017, one of the key drivers being the weak pound as a result of the market’s dim view of the UK Government’s Brexit plans. That is the context in which we are thinking about consumers booking future holidays.

It is extremely important that the UK Government give assurances that they will seek to ensure a future partnership framework, and will retain the consumer benefits of the 2018 regulations. I agree that it is important that protection be expanded for consumers buying package holidays, to reflect modern travel booking methods, such as online booking, and that we broaden the definition of “package” to encompass new ways of purchasing package holidays.

This statutory instrument shows the importance of EU member states working together, but I fear—perhaps the Minister will seek to reassure me—that over time, Brexit will inevitably dilute and damage the consumer rights that are currently protected by EU member states working together. This will be at the expense of general consumer protection measures. As the right hon. Member for South Holland and The Deepings said, the package holiday sector is a moving and dynamic environment, so any UK Government have to be on their game to ensure that there is no unnecessary and damaging divergence in the kind of protection that we seek in this dynamic and innovative environment, to use the right hon. Gentleman’s words.

The new directive introduced a requirement for insolvency protection arrangements that were mutually recognised by EU member states and the UK, backed up by a central contact point that should, I hope, reassure consumers of package travel. As we have heard, this insolvency protection must work for all consumers who need it. I am sure that the Minister will agree that travel businesses need to be made fully aware of consumer rights and protections, as others have indicated.

I welcome the protections offered in this statutory instrument, but I have to say again that it will not put back into holidaymakers’ and householders’ pockets the income that has been lost since this Brexit episode started. People’s income is an estimated £900 less than the Bank of England forecast it would be in 2016. That comes alongside a decline in real wage growth since the Brexit referendum. I fear that consumers will be taking fewer holidays and therefore, sadly, will need fewer protections, but those who do take holidays rely very heavily on the kind of protections set out today.