Competitors measure up to ABTA

Advantage and Worldchoice are stepping in to offer a competitive alternative to ABTA membership. ABTA has had to reshape itself and will have to find millions of pounds to get back into financial equilibrium. Competitors are now emerging from the shadows just when ABTA is in it's weakest moment. That said, any organisation that is going to underwrite a significant amount of business is going to need a lot of funds to call on.

The trouble really began when ABTA stepped away from it's 100% guarantee, and the rot set in when it upped it's rates last year. At this stage it looks like ABTA are not going to make and knee-jerk reactions, choosing instead to give assurances to it's members and trust that their 'goodwill' will stand them in good stead. This is the first time that ABTA's dominant position has been challenged, they would do well to consider how they can best serve their clients to keep them on side.

ABTA bonding under threat

There are more calls for scrapping of the ABTA fund for bailing out stranded passengers such as in the XL failure, and replacing the bond with individual travel insurances. As ever, BA opposed the idea claiming that it meant that it's clients would effectively be subsidising less financially stable companies. This has been countered with the idea that established operators culd charge a lower levy that newer companies.
At the end of the day, the money for repatriating stranded holiday makers has to be met by some mechanism, and it is always going to be some form of 'tax' on the traveller. Individual insurance is as good a way as any in theory, but the idea of a central fund means that there is one body taking responsibility for repatriation rather then twenty different insurance companies. The management of the fund is under question with it currently being in the red, this is a state that cannot continue and there is no doubt that travellers should be the ones to foot the bill in the end.

Just a quid campaign revitalised

The UK Government is being lobbied by various groups including ABTA and the Liberal Democrats to bring in a £1 levy on all flights to help to protect customers who may get stranded in similar circumstances to the XL customers recently.
The previous attempt failed to progress through a House of Commons vote in 2005, defeated by just three votes.
This money would be used to form a fund that could be used to support stranded holiday makers in the future. Most lobbyists see this as a small price to pay for the security offered, but resistance appears to be mainly from the scheduled airline operators who do not want to be subsidising what the see as their smaller, less well-financed rivals.