Monarch: Abta says air fares must increase to subsidise tax after airline's collapse

‘There has to be a fighting fund based on a levy on all flights’

Simon Calder
Travel Correspondent
Tuesday 10 October 2017 14:56
Mark Tanzer comments on Government bailout of stranded Monarch passengers

All plane tickets should be subject to a levy to fund the repatriation of passengers after an airline collapses, the Association of British Travel Agents (Abta) has demanded.

The organisation’s chief executive, Mark Tanzer, said: “The Monarch collapse has shown consumer protection in travel is not understood and there’s a gaping hole at its centre.”

Monarch went into administration in the early hours of 2 October, citing terrorism in Tunisia, Turkey and Egypt for its demise. Almost 2,000 employees lost their jobs.

Simultaneously the Government announced that all 110,000 passengers with Monarch tickets up to 15 October would be brought back free of charge.

Mr Tanzer told Abta’s convention in the Azores that the association was not consulted about the airlift. He called the exercise “completely unsatisfactory”, and said: “It sets a precedent for next time there’s an airline failure.

“Either the Government sticks to the principle ‘you’re unprotected, you’re on your own’ or it adopts the principle that everyone has to be brought back.”

If the latter, he said, “There has to be a fighting fund based on a levy on all flights.”

A levy of £1 on all flights from the UK would amass around £125m in a year. The Government-funded airlift cost about half as much – representing a fare of £545 per passenger.

On Monday the Transport Secretary, Chris Grayling, praised the airlift: “I have been hugely impressed by what I have seen, and we have had a very strong, supportive response from the passengers affected.”

He said: “There would have been insufficient capacity in the commercial aviation market to enable passengers to get home on other airlines. The danger was that tens of thousands of passengers abroad would have no easy means of returning to the UK.

“That is why I instructed the CAA to ensure that all those abroad were offered an alternative flight home.

“We are currently engaged in constructive discussions with the relevant credit and debit card providers so that we can recoup from them some of the cost to taxpayers of the repatriation flights."

But Andy McDonald, the Shadow Transport Secretary blamed the collapse on “a litany of failures by the Government, the regulator and the company’s financial backers and advisers”.

He said: “A further backdrop to the industry is the foggy skies of Brexit, and the total lack of certainty from this Government for the British aviation industry after March 2019.”

Mr Grayling responded: “This airline did not fail because of Brexit; this airline failed because it had a business model that was not capable of dealing with a price war in the Mediterranean.”

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