Seven years of failure

For the seventh year in a row the ATT (Air Travel Trust) trustees are late filing the accounts of this depleted fund, which is meant to underpin the ATOL scheme.

The ATT trustees are employed by the CAA and are obliged to file accounts by 30 June each year, within 90 days of year end, but they don’t. The 2023 Accounts were published almost a year later than the accounting period that they refer to. The trustees are responsible to the Secretary of State for Transport, but successive Ministers have failed to hold them to this.

Since the colossal failure of Thomas Cook, the ATT has relied heavily on the backing of the taxpayer to be considered a ‘going concern’. The questionable refusal of FOIR’s on this subject and the late accounts add to the feeling that there is something to hide.

There are insufficient funds within the ATT to meet the risk of the ATOL scheme as a result of the woeful financial regulation in travel. Travel is the only major industry which still allows Client’s pipeline payments to be misappropriated as ‘working capital’. What would be illegal behaviour for Solicitors, Bookmakers, Funeral Directors and the purveyors of Christmas hampers is lamentably common practice in travel to the detriment of the consumer and the taxpayer. Aside from the money, travel failures cause untold misery to those who lose their much-anticipated holiday, which would be much reduced with proper financial conduct.

ATOL reform was meant to address and remove the burden from the Treasury, with the introduction of the simple solution of Trust or mandatory Escrow. However, between the CAA and the DFT they have lacked the wit and gumption to get on with the reform thus far to ensure Travel companies are properly capitalised.

Travel companies that have operated trust accounts to safeguard client funds have never called on the ATT, despite being forced to contribute to it. Whereas those who use Client pre-payments to capitalise themselves have taken many hundreds of millions from the ATT and Tens of millions more from taxpayers. Why would Government and Civil servants not want to address this and benefit so benefit the consumer and the taxpayer? It is satirical that the CAA are charged with the financial scrutiny of the industry but can’t even get their own accounts together.

We can only hope that Louise Haigh, the newly appointed SOS for Transport will be calling the ATT and CAA to account, bringing an end to seven years of failure.