Air Travel Organisers’ Licensing Bill

Patrick Grady Excerpts

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

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

I welcome you to the Chair, Madam Deputy Speaker. It is a pleasure to follow the hon. Member for East Renfrewshire (Paul Masterton). It has been great to hear his and other maiden speeches, which have brought back diversity to what would otherwise have been a one-sided debate. I gently point out to him, however, that the irony of a Conservative Member mentioning divisive nationalism is not lost on us. On the question of the Government getting on with the day job, we are debating this Bill because they actually did not get on with their day job, and chose instead to call an early general election that was not needed.

As a Back Bencher, I find it frustrating when the Chair has to apply a time limit to cut speeches short, leading to frantic scoring out. I think that time limits would actually have been useful for some of tonight’s speakers, because some hon. Members have managed to speak at amazing length about a Bill that is only four clauses long. I will try to be a bit briefer.

This is a small but welcome Bill, although it is perhaps indicative of the Government’s lack of strength and ambition, given that its measures were originally part of the wider Vehicle Technology and Aviation Bill. Even so, this four-clause Bill was heralded in the Queen’s Speech, which, as we all know, lacked ambition.

The air travel organisers’ licensing scheme is well known and has provided comfort to thousands of holidaymakers over the years. It has rescued people financially and literally got them home in a timely fashion. It is a fantastic scheme. As other hon. Members have said, holiday travel and booking arrangements have changed over the years, so it is only appropriate that protections change too.

The Minister was keen to say that the UK has led the way in Europe with ATOL. I do not dispute that, but over the years the European Union has also strengthened passenger rights, and it is imperative that those rights are not weakened post-Brexit. The UK Government need to provide assurances that the rights and protections of travellers will not be diminished after the UK leaves the EU.

In fact, it is the 2015 EU package travel directive, which will be applicable from 1 January 2018, that is the driver for this Bill. The fact that three quarters of those who booked holidays last year did so online highlights the need for further protections. It is to be welcomed that protections will now extend beyond traditional package holidays. The new directive applies to three sorts of travel combinations: pre-arranged packages; customised packages; and linked travel arrangements.

I also welcome the fact that clear protection will be provided to 120 million consumers across the EU who book other forms of combined travel. A further advantage is that the measure is expected to reduce detriment to consumers across the EU by about €430 million a year, while at the same time reducing the administrative burden on businesses. It is suggested that compliance costs for traders will reduce from €11 to €8 per package.

Yet again, we have to be grateful to the EU for taking on big businesses, including the airlines, and extending consumer rights to meet modern travel needs. Since the EU legislated to provide a comprehensive system of air passenger rights in 2004, increased awareness of those rights, and of the ability to complain and appeal, has led to a significant increase in the number of people doing so.

That has been supplemented by a number of court cases that have ruled on the circumstances in which airlines must pay compensation. Appeals against some of those judgments have meant that some airlines have been reluctant to pay compensation until the legal position is absolutely clear. There is therefore still industry resistance to the current compensation schemes. I repeat that it is absolutely vital that the UK does not weaken any legislation in the future.

[Patrick Grady (Glasgow North) (SNP)]

I welcome you to the Chair, Madam Deputy Speaker, and congratulate the hon. Member for East Renfrewshire (Paul Masterton) on a fluent maiden speech. I am sure it will not be the last such speech he gives in this House.

Does my hon. Friend agree that this Bill demonstrates why we need Government assurances about the impact of Brexit? There are so many uncertainties about so many aspects of consumer protection and its impact on individuals’ daily lives. If we had had such assurances and clarity this time last year, perhaps we would not be in this situation.

[Alan Brown]

I completely agree with my hon. Friend. There seems to be great reticence on the part of the UK to come out and give the necessary cast-iron guarantees. We are a year down the line since the vote, but we have not moved forward in many regards. Too often we keep hearing how everything will be okay, but we need to start seeing some flesh on the bones.

We still do not know when the UK will develop its own system of passenger rights and compensation in the aviation sector post-Brexit, how similar that will be to the current arrangements and, importantly, how non-UK airlines and passengers will be affected. That brings me back to the point that we need a clear guarantee from the UK Government.

On a slightly different theme, Scotland has a large number of regional airports, many of which are completely reliant on low-cost airlines and outbound tourism to survive and be an economic success. Recent reports have stated that Prestwick airport in my neighbouring constituency is vulnerable to Brexit, given the number of low-cost airlines there and the type of passenger traffic, which is mainly outbound. Despite the fact that the Scottish Government have voted to reduce air passenger duty by 50%, which they hoped to use as a mechanism to grow the number of routes operating out of Prestwick, Ryanair has confirmed that, because of the uncertainty surrounding Brexit and the open skies agreement, it will not expand further at the airport. That is a cause for concern with regard to local jobs in my area.

The International Air Transport Association predicts that just a 12% reduction in sterling would result in a 5% decline in outbound travel from airports. Since the EU referendum, sterling is down 25%, so it has become even more vital for Prestwick airport that we continue within the open skies agreement and maintain outbound passenger numbers. It is incumbent on the UK Government to give an unequivocal guarantee that the UK will stay in the single aviation market after we are taken out of the EU.

Remaining in the open skies agreement—the single aviation market—is vital to ensuring that our airports remain economically viable, and low-cost airlines are vital for regional airports to be a commercial success. EasyJet is setting up a separate operation outwith the UK to ensure it can continue to fly without restrictions after the UK leaves the EU, which is in no small part due to the lack of clarity over the aviation agreement that the UK will eventually come up with.

It is clear that, despite the mantra that everything will be okay when we leave the EU, or even better than the current arrangements, the risks are materialising in front of us. It is clearly worrying if airlines are finding other EU member states a more attractive proposition, and the UK Government need to think seriously about how they are going to counteract that problem for our regional airports. The UK Government really must provide clarity and certainty sooner rather than later.

Clause 2 gives the Transport Secretary the power to reform ATOL and the air travel trust fund using only the affirmative procedure in each House of Parliament. The UK Government need to provide assurances that any changes that the Secretary of State makes to the ATOL scheme through secondary legislation will be preceded by a proper consultation of members of the industry and consumer groups, and by an appropriate impact assessment.

We welcome the Bill but, as I said in an intervention on the Minister, we are concerned about the status of legislation on laser pens and, as the shadow Transport Secretary said, drones. It is imperative that the Government move quickly to provide reassurances on those matters.