The UK government will pick up the initial cost of repatriating Monarch Airlines’ passengers following the collapse of the airline and Monarch Travel Group in the early hours of Monday.
The CAA confirmed the Air Travel Trust will fund only the repatriation and refunds of Atol-protected customers. CAA deputy director of consumer protection David Moesli said: “We were given instructions by the government to carry out this [repatriation] exercise. The government will pay. However, the government has said it intends to recover the money from other parties.”
Travel Weekly was awaiting Department for Transport (DfT) responses to a series of questions, including whether it would now pay for repatriating passengers of failed scheduled airlines, as we went to press.
Monarch went into administration with 110,000 customers abroad and 300,000 forward bookings affecting 750,000 passengers.
More than 1,850 staff lost their jobs on Monday, 1,760 at the airline and 98 at Monarch Travel Group, with about 250 remaining to assist administrators from KPMG. The Monarch Aircraft Engineering division is not in administration and continues to trade.
Other companies showed immediate interest in recruiting Monarch staff, with easyJet seeking 400 cabin crew at Gatwick and 100 at Luton, and Virgin Atlantic and Olympic Holidays announcing vacancies.
Monarch chief executive Andrew Swaffield absolved owner Greybull Capital of blame in a message to staff on Monday, saying: “Our owners have provided us with continuous support. I’m truly sorry it has ended like this.”
The CAA flew home almost 12,000 customers on 61 flights on Monday, with a similar number due to fly on Tuesday, and expected to complete the repatriation in a fortnight.
Both the CAA and DfT described the operation as “unprecedented”, with CAA head of Atol Andy Cohen explaining: “We have a fleet of aircraft from 16 carriers, including British, North American and Qatari.”
The CAA insisted it had not sent Monarch into liquidation by refusing to renew the company’s Atol from October – required for only about 5% of its flying. Cohen said: “The group failed for financial reasons.” However, the CAA also insisted it was not possible for Monarch to continue flying without its holiday business.
Moesli said: “These two businesses were joined at the hip. They really were one business. Monarch had been trying to convert to a low-cost, short-haul carrier, but it was a leisure carrier. You cannot pull the two companies apart.”
Swaffield confirmed the Atol renewal was a factor, telling staff: “We’ve run up to the Atol renewal deadline without a viable plan and the CAA has been unable to license us.”
The CAA expects debit card issuers to join credit card issuers in refunding customers with advance bookings although there is no legal requirement for them to do so. Moesli said: “We have high expectations the debit card issuers will make payments.”
Cohen added: “There is a significant amount of forward bookings, but it is manageable.”
Scheduled Airline Failure Insurance (SAFI) provider IPP reported “unprecedented claims” following the collapse. Managing director Paul Mclean said: “We’d been cautious of our exposure on Monarch for some time. Monarch’s change of model away from Atol left a huge amount of people exposed.”
Monarch: At a glance
Monarch carried six million passengers a year and employed 2,100.
It flew from bases at Luton (645 staff), Gatwick (420), Manchester (425), Birmingham (389) and Leeds-Bradford (60).
Monarch Travel Group employed 153 staff, with main offices in Bromley (72) and Stockport (39), and 40 staff overseas.
The company entered administration on October 2 at a time when all aircraft where on the ground. KPMG is handling the administration.
110,000 customers abroad on October 2 will be repatriated upon completing their holidays.
Advice for customers affected by the cancellation of 300,000 forward bookings is available at monarch.caa.co.uk
In a message to staff, Monarch chief executive Andrew Swaffield said: “Outside influences badly affected us. Since 2015 we’ve seen yields collapse by a quarter, resulting in £160 million less revenue. This year the airline is carrying 14% more passengers for £100 million less revenue.
“Many of you have spent years working for this company and I want to thank you for your service and loyalty.”
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