Opinion: Allard sets out stall for tackling costs of over-protection

Opinion: Allard sets out stall for tackling costs of over-protection

By now all Abta members should have received the electoral voting form in order to vote for the next chairman of the association.

Noel Josephides, who is standing against me, in his article in Travel Weekly last week, said he couldn’t promise something he can’t deliver.

Well if we don’t go out and sort costs out we can’t deliver change.

Like Noel I have been at the front end of understanding bonding and how it works.

Back in the late eighties and early nineties I was a director of the TOSG trust fund, and throughout the eighties helped save some smaller operators and some agents from going bust – at Owners Abroad we acquired quite a few – saving some well known brand names, as well as jobs, and have continued that policy since.

Times have changed and increasingly we have more red tape and have to provide greater financial commitments in order to trade.

Many of us, whether we are agents or operators, are paying out for protecting our clients several times over.

In fact Atipac, where Noel represents Aito and I represent Abta, confirmed recently that 43% of consumers are either double or triple protected and you pay this cost.

I want to get rid of this obvious waste of expenditure and reduce your overheads.

Another extra cost is that credit card providers charge us additional fees for the consumer credit they cover, but currently if an operator goes bust the repatriation that the CAA fulfils, together with any ground cost, is paid out of the Air Travel Trust (ATT) fund – so in reality this is double cover and extra cost.

In the call for evidence on Atol bonding the Department For Transport included a consideration to protect all consumers regardless of how they paid, after we lobbied the CAA.

Whilst there may be small fee introduced for accepting credit cards as part of the Atol Protection Contribution, it should reduce the fees we pay to credit card companies because their risk is far lower.

Many Abta members currently provide bonds or cash collateral and even deferred payments from credit card transactions. By changing this the above should disappear providing better cash flow and greater choice of provider at lower rates.

It’s is important to me to find ways of reducing overheads and red tape so that you have the opportunity to improve your bottom line.

I understand real business. It’s all about efficiency and one guarantee I can give you is that I will be looking for efficiency of cover, examining for duplicated or unwanted costly cover and that has got to lead to savings for most members.

I’ve mentioned the call for evidence by our government on Atol bonding, but Abta also has a second very important issue: in a month’s time we will receive the EU Package Travel Directive (PTD) proposal from Europe. 

The European Commission has been working on a revised PTD since 2009, brought about in response to the changes in travel distribution, particularly ‘dynamic packages’ and click-through arrangements. 

Abta consulted with its members on PTD in December 2009, and has been working at a European level since that time to put forward members’ views, explain UK business models and processes and lobby the Commission on the shape of the prospective proposals. 

When we receive the PTD I believe it should be looked at simultaneously with the Atol call for evidence, and we may need to ask our government to extend the closure deadline of August 15, 2013 so we can take time, effort and commitment to look at these issues very carefully and in unison, as they will probably both overlap.

I feel I can make a valuable contribution in ensuring both issues make sense for all members, that they respect legitimate business models and are logical in terms of consumer protection.

Needless to say if I am voted Abta chairman I will work tirelessly on these issues. Thank you for reading the above.


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