News

Interest payments on the overdrawn Air Travel Trust fund dwarfed pay outs for company failures in the last year of bonding for ATOL-protected firms.

The fund paid out just £374,000 in the year to the end of March, despite total payments of more than £5.3 million to cover refunds and repatriation of clients of failed travel firms. Interest payments were close to £1 million.

The remainder of the bill was paid out of bonds, demonstrating the robustness of the old system for which the ATT fund acted as a back up.

A £1 ATOL Protection Contribution on sales replaced the bonding system for most companies in April, although a small number of firms and new industry entrants still require bonds.

Twenty-five companies failed over the period, two down on last year but the same as the previous year. However, a single failure - that of Tapestry Holidays - in August 2006 cost the fund £2.5 million.

In the past year only three companies, Go4 Hajj & Umrah Tours, Oasis Tours and E-4 Events, appear to have been severely under-bonded. Go4 Hajj, which ceased trading in January and held a bond for £22,000, cost the fund £207,000.

Oasis Tours, which failed in November, cost the fund £90,000 and E-4 Events £20,000.

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