30 March and 30 September ?

These are the two dates chosen by the CAA in the distant past as the arbitrary dates for ATOL licence renewals.

30 September has some logic as it coincides with the low point in cash flow for the large-scale European package operators, as they settle bills for the summer just gone. Major Tour Operator failures most often occur at this time:

Clarksons/Court line failed: August 1974

XL Leisure failed: September 2008

Monarch/First Aviation failed: October 2017

Thomas Cook failed: September 2019

Etc

However, this is shutting the stable door after the horse has bolted, the signs of financial distress manifest themselves several months before failure.

The CAA are vetting around two thirds of licences (circa 1000 in September) at the same time of year that major failures tend to occur.

The 30 March date, where around 550 licences are renewed, has no apparent logic.

Luxtripper, Florida Direct and Travel Inspired all renewed their ATOLs on 30 September 2023 and failed within weeks. This questions the CAA’s scrutiny and judgement and looks poor value for the £8M funding they receive for this task.

In the case of Luxtripper the last filed accounts went up to March 2022 and were unaudited. Were these the 18 month old, unaudited accounts the freshest the CAA demanded to scrutinise?

The CAA make their job much harder and more costly than it needs to be.

What chaos would ensue if all car MOT’s were 30 September and all van’s and lorries were 30 March? The mechanics would be very busy a few weeks a year, we would need more mechanics, MOT’s would cost more, checks would be less thorough and the whole system would grind to a halt.

Nearly all equivalent annual licences relate to a birthday, which staggers them through the year and demands current, topical information.

If the CAA spread licence renewals throughout the year, they would have more time to scrutinise accounts, they could time renewals to ensure recently audited accounts and they would need a smaller, less costly team.