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UK Airline Insolvency Review – publication of final report

The UK Transport Secretary Chris Grayling commissioned the review following the collapse of Monarch Airlines in October 2017, when 85,000 passengers were repatriated by the Civil Aviation Authority, but at a cost to UK taxpayers. The review has considered both refund and repatriation protection in the event of an airline or travel company failure.

ERA contributed to the work of the review in support of our members and made it clear that additional costs to airlines, which would be passed down to consumers, would not be welcomed by industry despite the well-meaning intent of the review. We also expressed surprise that there had been apparently little attempt to recoup costs from affected passengers already protected through personal travel insurance and credit card protection and that more could have been done by the UK Government following the repatriation exercise to reduce the UK taxpayer burden in this regard.

The key recommendations from the report are as follows:

  • Proposals for a new Flight Protection Scheme, which would protect passengers if an airline became insolvent while they were abroad. It is estimated the cost of the protection will amount to less than 50p per passenger on average.
  • Reforms to the UK’s airline insolvency regimes so an airline’s own aircraft can be used to repatriate its passengers should it fail.
  • Providing the CAA with the necessary powers and capability to co-ordinate repatriation operations for all sizes of airline.
  • Improving awareness and take up of safeguards which protect the future bookings of customers, when airlines collapse.

The full report can be found here.

The Department for Transport will now consider the range of options put forward, and stakeholders are encouraged to respond to the recommendations as part of the ongoing consultation on Aviation 2050, which closes on 20 June.

For further information or questions, please contact russell.dudley@eraa.org