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0 pointsphysicsguy6y ago0 comments

It’s not a subsidy; the companies which sell package holidays need to put the cash up.

It was done because of financially unstable package holiday companies setting up and then failing leaving people stranded. Most people in the UK know to buy an ‘ATOL Protected’ holiday if they go for a package deal.

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shkkmo6y ago

That doesn't answer my question at all.

Why doesn't ATOL protect non-package customers of Thomas Cook airlines? Why didn't it protect the customers of Monarch Airlines? Given the large number of airlines that have collapsed and stranded customers in the last couple of years, the "holiday package" limitation just doesn't make sense.

greglindahl6y ago

It ends up being a subsidy when the largest provider collapses and the funds don't cover the problem. Who pays then? Oh, the government.

michaelt6y ago

Given that the Air Travel Trust has £170 million of cash and £400 million of insurance; that when Monarch Airlines failed they could repatriate "around 110,000 passengers" for £16.3 million [1]; and that Thomas Cook's collapse leaves about 150,000 holidaymakers [2] in need of repatriation; it seems unlikely the funds will fail to cover the problem.

There might be other expenses, outside the scope of the ATT, that the government ends up paying - there are estimates as high as £600 million [3] - but arguably that's a sign the scope of the compulsory insurance scheme should be broader, not narrower :)

[1] http://publicapps.caa.co.uk/docs/33/ATT_Accounts_2018.pdf [2] https://www.bbc.co.uk/news/business-49791249 [3] https://www.bbc.co.uk/news/business-49781920

consp6y ago

Who are also first in line to collect when the company goes into bankruptcy and there is still money somewhere.

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