A predicted bloodbath of operators and agencies has been averted thanks to the Civil Aviation Authority's "pragmatic" approach to ATOL renewal.
Leading travel industry accountant White Hart Associates senior partner Chris Photi said he had been concerned that a disproportionate amount of companies could have been forced to close after finding themselves unable to renew their licences at the end of March.
If the CAA had not renewed the licences it could have been forced to pay out millions to failed companies through the Air Travel Trust Fund, which has already had to pay out £80 million following the collapse of the XL Leisure Group in September 2008.
He added: "If you've got a big exposure to the Air Travel Trust Fund then the CAA has been far more pragmatic [in granting the ATOL] just to keep you going.
"A lot of these companies have gone through because the CAA can't afford to take a hit [on the fund]."
However, a CAA spokesman denied there had been any slackening of the rules in order to protect the fund.
He added: "We used the same checks, the same criteria and the same requirements as we've always done. There's absolutely nothing different."
ABTA head of development Andy Cooper argued problems may have been averted because companies have improved cash flow as the market has improved since the beginning of the year.
He said: "In reality, if you're careful with your cash flow, you shouldn't be having problems as cash is still coming in. While the market is down, it's not down massively.
"It is not like bookings have dropped off a cliff."
The CAA has confirmed that:
- 102 companies are no longer renewing their ATOL
- 106 are late renewing their ATOL
Among those companies who have lost their own ATOLs are Hidden Croatia, which is now covered by Holiday Options following its merger, and Miss Ellie's World Travel, which joined the Freedom Travel Group this week.
- Why the end of March was a critical moment for operators [Travolution Blog]
- ATOL renewal update - who is out and who is waiting? [Travolution Blog]
This is a community-moderated forum.
All post are the individual views of the respective commenter and are not the expressed views of Travel Weekly.
By posting your comments you agree to accept our Terms & Conditions.