Government clarification on the issue of refund credit notes to consumers for cancelled holidays may be delayed into next week although sources suggest it “remains close”.
Official confirmation that refund credit notes will retain Atol protection against insolvency had been expected by the end of this week, with CAA guidance on the notes understood to have been agreed with the Department for Transport (DfT).
The hold-up continues to be at the Department for Business (BEIS), headed by business secretary Alok Sharma, which oversees the Package Travel Regulations (PTRs).
A senior industry source declared: “It’s deeply frustrating. What does the government need to make it act – a substantial failure?”
However, it is also understood the government may be looking afresh at the implications of temporarily suspending the PTRs’ requirement to refund consumers within 14 days amid rising fear of insolvencies.
The source said: “The government has been warned and can see it happening now. But there is so much on the government’s plate and there is fear of doing something perceived as unfriendly to consumers.”
Other sources with knowledge of the process continue to insist BEIS will balk at making credit notes a lawful substitute for cash refunds.
One said earlier this week: “We’re not expecting any change to regulations because of lobbying by consumer groups. The government will simply say ‘If you accept a refund credit note, we will pick up the tab if the company becomes insolvent’.”
Alan Bowen, advisor to the Association of Atol Companies, said: “The government is not going to change the PTRs. We just have to live with it. But it would be very helpful if the CAA could say refund credit notes are protected.”
Travel Weekly understands the CAA will complete the delayed March Atol renewals on April 28 as previously announced.
The March renewal process was pushed back because of the Covid-19 crisis and some Atol holders have expressed concern the renewals could be further delayed.
However, renewal applicants should receive confirmation of their Atol status on April 28, with the new Atol data published by the end of the month.
Abta, which has led industry lobbying for recognition of Refund Credit Notes, defended its position today amid calls from some in the sector to reconsider its position.
The association insisted it had been clear members must pay refunds when requested “without undue delay” and said: “The government needs to come up with a plan where the customer’s interests are protected first and foremost.
“It also needs to be a system the majority of companies can deliver, because if they can’t that isn’t in the customer interest.”
