AFTA last month released its 2016/17 annual report, celebrating an array of achievements over the last 12 months particularly including the ongoing success of the AFTA Travel Accreditation Scheme (ATAS). AFTA CEO Jayson Westbury noted that along with continued strong support for the scheme, not a single ATAS accredited agent had entered insolvency during the year.
“This fact is very pleasing as it does show that travel agents across the country have continued to run profitable and successful businesses – which is something that AFTA has always aspired to,” he wrote in the report’s review of the year. He said ATAS had been instrumental in elevating standards across the industry, with the accreditation program now standing as the “mark of quality and professionalism” for the sector.
AFTA chairman Mike Thompson noted the organisation had lived within its means – despite a number of extraordinary expenses including a difficult Supreme Court challenge by former member Bestjet. The success of ATAS has seen membership numbers and overall revenue increase during the year, with the Federation reporting an operating surplus of $9,247 for the year. Membership and accreditation fees accounted for the lion’s share of income, amounting to $2,122 million – an increase of more than $300,000 on the prior year. The National Travel Industry Awards 2016 recorded a net profit of $70,554 and AFTA also received income from some marketing activities such as the afta@mail newsletter, website contributions and email distribution services, worth about $30,000 overall.
Other income included an $85,000 grant from the Tasmanian government, which was utilised for education processes for consumers and travel agents. Key costs included employment expenses worth $1.36 million, marketing and advertising amounting to $297,000, $160,000 in representation costs and $144,700 worth of legal expenses. AFTA also received more than $30,000 of interest income during the year.
ATAS grew to a total of 2,950 locations across the country, with the report also detailing a range of activities around the scheme. During the year there were 355 new applications for participation but the majority of these failed to submit the required documentation to warrent an assessment of the application. New applicants joining the scheme totalled 147, while 27 applications were declined and a further ten were still outstanding as at 31 March 2017. During the year several existing members had their accreditation cancelled, including four which failed to demonstrate they were ‘fit and proper persons’ as described in the ATAS charter. A further two members had their accreditation cancelled due to solvency concerns, while 14 members closed down and 13 decided not to renew. AFTA noted that this data only referenced individually accredited entities and excludes Flight Centre and STA branches.
Interestingly 31 ATAS participants were placed on “Monitoring Agreements” requiring them to supply quarterly trading updates including cash balances, net asset positions and net profit data. Monitoring Agreements are required for a minimum of 12 months in most cases, and evaluated on an ongoing basis – and all new ATAS participants classified as start-up businesses are now required to adhere to a Monitoring Agreement as part of conditional approval for ATAS accreditation.
The other interesting area covered by the report was the outcome of complaints against travel agents in the ATAS procedures. A total of $63,004 was returned to Australian consumers via the ATAS complaints escalation process, relating to 47 complainants. In all 355 complaints were received during the year, but 152 were ineligible as they related to non-ATAS participants.