Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps he plans to take to strengthen laws to protect consumers from businesses that hold deposits for a long period of time.

Consumer protection law requires mandatory protection of consumer deposits in a number of sectors, and particularly in the travel industry. The Package Travel and Linked Travel Arrangements Regulations 2018 ensure arrangements are made so travellers are refunded, or where applicable repatriated, should the organiser become insolvent.

In July 2020 the Government announced that passengers who accept refund credit notes for cancelled holidays as a result of COVID-19 will be protected by the ATOL scheme if necessary. If the CMA finds evidence that companies are failing to comply with the law, it will take appropriate enforcement action.

In July, the Government published a command paper, ‘Reforming Competition and Consumer Policy’ that sets out a range of proposals to enhance consumers’ rights, including with regard to consumer prepayments which in some cases count as deposits. The consultation closes on 1 October and can be found at the following link: https://www.gov.uk/government/consultations/reforming-competition-and-consumer-policy.