Package holiday protection boosted

Plans to provide official financial protection for millions more package holidaymakers were announced today by the Government.

Many holidays involving flights are covered against airline or tour operator collapses by the Air Travel Operators' Licence (Atol) scheme.

But a number of air travel trips are not Atol-protected.

Today, Aviation Minister Theresa Villiers announced the Government was consulting on proposals that would mean up to six million extra holidays would be covered by Atol, which is run by the Civil Aviation Authority (CAA).

Mrs Villiers said: "As we move into the busy summer period, millions of us will be heading abroad on holiday. While the chances of a holiday company going under are thankfully very low, the impact on those affected can be significant.

"Recent years have highlighted not only how important financial protection is to holidaymakers, but also the fact that the Atol scheme is in urgent need of reform."

She went on: "We have always been clear about our commitment to modernising the Atol scheme, and these proposals are an important step towards achieving just that. As well as ensuring up to six million additional holidays are protected, these proposals will help steer the scheme's finances on to a more sustainable path for the future

"We are also making an important step forward on the debate on delivering a wider reform of Atol in the future."

CAA chairman Dame Deirdre Hutton welcomed the proposals "because they will bring clarity for consumers and put an end to the situation where people are left unsure to what extent their holidays are protected if their company fails".

She went on: "Today's announcement will empower consumers to make informed choices about their air holidays.

"This is the first step in the reform of consumer financial protection and the CAA will be consulting on further proposals on the funding of protection in the autumn."