AFTA View – December 2012/January 2013

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Jason WestburyFarewell TCF – now things will get interesting

By Jay Westbury, chief executive Australian Federation
of Travel Agents


AS you will be aware, Australia’s Consumer Affairs Ministers have decided to progress the Travel Industry Transition Plan (TITP).

The ministers have confirmed the following key points.

1. A staged phasing out of the existing scheme of national TCF coverage and state based travel agent licensing.
2. Consumers will have a greater reliance on the Australian Consumer Law (ACL) and other generic corporation laws and market-based remedies which are to be developed.
3. The TCF will be wound up and some of tis funds will be allocated to grants outlined below. Remaining funds will be paid out to the states that adopt the TITP reforms.
4. A stakeholder communications and education process will be developed for both trade and consumers.
5. A one-off grant will be issued to an appropriate body for consumer research and advocacy purposes.
6. A one-off grant will be issued to develop an industry-led accreditation scheme.
7. The TCF will continue to pay claims while the transitional arrange-ments are put in place.

The ministers clearly indicated that, in conjunction with the industry, commercial solutions will be sought to address alternatives arrangements to provide insolvency coverage to replace the TCF.
The last statement of the Ministerial Communiqué said: “All jurisdictions will cooperate to achieve implementation of the plan and South Australia and Western Australia will consider their position in light of the national scheme no longer operating.”

This statement has caused some confusion but I read it to mean that all jurisdictions will co-operate to implement the plan, however South Australia and Western Australia may decide to introduce replacement arrangements for the TITP.

Clearly there is no further detail about this available at this early stage and AFTA will be making representations to both states to establish what they may have in mind. It would, of course, be in the national interest and the industry’s interest for these two states to be part of the new arrangements fully.

This may well be the case in the end and as the detail around the new accreditation scheme, commercial solutions to insolvency and other consumer arrangements emerge, we may find that SA and WA are happy with the proposals.

It should not go unnoticed that a one-off grant will be issued for research and consumer advocacy – even though we are yet to fully understand what role this will play.

I am hopeful that it will assist consumers to understand the importance of using an Australian travel agent required to be compliant with the ACL and other Australian laws. I suspect this will be a major part of advocacy role, hopefully pro-viding consumers with good advice.

This review process has been a long one. The AFTA board, staff and indeed members have been patient and in the end we have got an outcome that will ultimately remove government from the oversight of the travel industry and leave this process to the industry.

I am encouraged by the over-whelming support AFTA continues to get for this process.

While there are some that appear ill informed as to the detail and perhaps even a little unhappy, what is most important in the end is that the Australian travel industry is structured to ensure travel agencies can thrive and survive in the global market place.

Stay tuned for the detail – things are just now going to get interesting.


Jay Westbury’s AFTA View column appears monthly.