Mid-Scotland and Fife MSP Murdo Fraser has called for the protection of retail gift vouchers in the event of administration.
ATOL [Air Travel Organisers Licence] protected holidays ensure holidaymakers receive a full refund in the event of a travel agent or booking partner going bust.
Travel firms selling air holiday packages must have an ATOL.
Before an ATOL is issued the Civil Aviation Authority (CAA) checks firms, thereby reducing the risk of failure. It also requires firms to pay into the CAA’s financial guarantee scheme. This provides money to protect customers. If a tour operator were to fail, the CAA will make a refund to the customer, or if they are abroad will arrange for them finish their holiday and fly home.
Commenting Murdo Fraser MSP said:
“This year we have seen £800,000 worth of Jessop gift vouchers declared null and void and until a U-turn from administrators, HMV vouchers would have followed suit.
“Unless we see a new approach to the regulation of gift vouchers, consumers will continue to be ripped off in the event of administration or liquidation.
“Obviously this type of scheme would be a major step change in UK retail law. Perhaps these regulations could be entered on a voluntary basis, which would give retailers with protected vouchers a competitive edge, thereby allowing market forces to regulate the industry.
“Essentially, consumer protection is paramount in returning shoppers to the high street, and this type of insurance could return confidence.”