Industry burnt by Monarch collapse
The collapse of Britain’s third largest carrier Monarch Airlines has dealt a double blow to the country’s travel industry, still in shock after the high-profile failure of the All Leisure Group and its Swan Hellenic cruise line earlier in the year.
Last month’s abrupt cancellation of all Monarch services led to the biggest peace-time repatriation program in Britain’s history as the country’s Civil Aviation Authority stepped in to bring more than 100,000 people home at the tail end of the European holiday season. A further 900,000 others with forward bookings were also affected, while more than 2,000 staff lost their jobs.
“I am so sorry that thousands now face a cancelled holiday or trip, possible delays getting home and huge inconvenience as a result of our failure,” Monarch chief executive Andrew Swaffield said in a statement. “I am truly sorry that it has ended like this.”
But a second shock has angered the travel industry as news broke that a large portion of the repatriation cost would be levelled at tour operators who had utilised Monarch.
The total bill — so far covered by the taxpayer — is around 60 million, or more than 500 per passenger. But tour operators are said to be incensed at having reportedly been asked to contribute 250 per passenger as the government attempts to recoup its losses.
The Association of British Travel Agents (ABTA) chief executive Mark Tanzer criticised the government’s handling of the collapse at the organisation’s conference last month, saying the industry have been given no choice or opportunity to provide input.
He singled out the decision to fund all passengers’ repatriation – regardless of whether their travel had been covered by the UK’s Air Tour Operators Licence (ATOL) scheme which provides protection in the case of a travel collapse — and said the government had now set a costly precedent for future collapses.
Tanzer argued the government should either stick to the principle that unprotected travellers wore their own risks, or provide a universal protection scheme funded by a levy.
Credit card providers have also been asked to wear some of the costs.