CONTINUED FROM BACK COVER
– travel independently outside of the current regulatory framework. Downs said: “Some people value
package holidays. Equally, a fair percentage do not value package holidays and are not prepared to pay for it. “What this legislation will do is widen the net and force people to buy a package when they do not want a package.”
He said that meant agents would be
forced to take liability for the product and find new insurance to protect themselves. “Now the package regulators say
we have all got to be in the insurance business – there is a cost to that.” Although Downs described the ATA
category as “convoluted” and “artificial”, he said it offered consumers choice and agents the chance to continue operating as agents. He suggested agents could “lead consumers down the route of perhaps lighter-touch regulation and a price point that suits them better”, adding: “The ATA needs to be encouraged.” Bowers responded by saying Downs’
view “reinforced the point of the danger of having a new category” and “highlights a risk that the legislation leaves open”. “It leaves open that agents have a choice, and if they structure things in the right way, that they will be able to take advantage of a low-cost regime,” he said. “I do not think that’s what the legislation intended.” Downs explained: “Agents must follow the rules. I’m not advocating that agents try to circumvent or twist the rules.” He said the issue was one of consumer choice and that the new rules were clear about the information agents have to give customers about what they are buying. “There is no question about the consumer having the wool pulled over their eyes. This is a clear opportunity for consumers to buy what they want and to buy at a price they can afford.” Downs said there was a danger that by heaping more costs on those bookings that are regulated, the proportion unregulated would grow beyond 54%. The new PTD is expected to be enacted in the UK by 2017 or early 2018.
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travelweekly.co.uk — 2 July 2015
travelweeklybusiness ABTA TRAVEL MATTERS: The association’s sixth half-day con
GREECE: TRAVEL SECTOR ADVISED NOT TO OVERREACT TOSTATE’S FINANCIAL CRISIS “Greece is always going to be a
The travel industry was urged not to overreact to the financial crisis in Greece. Graham Pickett, lead partner for travel,
hospitality and leisure at Deloitte, said he expected the EU to “muddle through”. “I don’t want to see this industry panicking and moving routes or plans, and announcing that to the consumer at large, because that’s not going to be helpful,” he said. Pickett said Greece and the euro “was
never going to work” and that the only reason the country would stay in the single currency was political.
problem – it’s never been good at tax collecting,” said Pickett. He said Greece defaulting on its debt and exiting the euro would be catastrophic. Andrew Swaffield, Monarch Group chief
executive, said the biggest risk related to Greece was a “self-imposed knee-jerk reaction”, with airlines moving capacity to an alternative destination such as Spain. He warned this would prompt prices to collapse in Spain and leave Greece with too little capacity, and that this would “create a crisis of a much bigger magnitude”. “If we don’t overreact, the Greece situation
can be relatively well managed,” he said. “There is a history of airlines tending to
overreact and moving their capacity too quickly. We would certainly be looking to support Greece and not to overreact.” Swaffield promised Monarch would stick
Graham Pickett
by Greece. Abta chief executive Mark Tanzer said: “It’s an unusual situation, but the travel industry in the UK is used to dealing with unusual situations and we will deal with it.”
AIRLINES: ‘ENSURE YOUR COST BASE IS UNDER CONTROL’
Airlines in Europe need to get their cost bases under control, according to Monarch Group chief executive Andrew Swaffield. About half of European airlines have a cost issue, said Swaffield, who led Monarch through a buyout and restructure last year. He said the process of restructuring the
European aviation sector would be painful and there would be “bumps along the way”, but it would be “broadly positive”. “I have a strong view that many airlines
in Europe will have to go through a similar exercise,” added Swaffield. “Unless they have employee engagement or sufficient consensus, it’s going to be challenging.” He praised the role trade unions played in the Monarch restructure, which involved 700 redundancies, salary cuts and a reduction in the size of its fleet.
“Monarch could not have restructured without the unions,” he added. “There’s no way I could have persuaded 3,000 people to have taken significant pay cuts, and changed terms and conditions, in the time we had.” MP Robert Goodwill, parliamentary under-secretary of state for transport, said he wondered what the outcome would have been had Monarch been French, as he doubted the unions would have been so keen to have worked with the airline.
Andrew Swaffield
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