Why should holidaymakers suffer

By | Category: Travel news

The debt carried by the Thomas Cook group seems to be growing larger by the day. At one time it was thought to be about £1.6 billion but some sources place it at £6 billion.

Why should we suffer having paid for our holidays?

It isn’t just holidaymakers that are out of pocket. Hoteliers and other accommodation providers, airline leasing companies and maybe some airports are owed..

And by owing so much, it looks like passengers are suffering – at least in the short term – as hoteliers demand money to cover unpaid bills that should have been paid by Thomas Cook.

There are stories from Cuba and Greece, Turkey and Tunisia that holidaymakers and, in some cases, Thomas Cook staff have been held “hostage” as one media outlet put it, until bills have been paid. Although governments have stepped in and calmed down hoteliers so that people can stay in their rooms it is a problem brought about by the travel industry itself.

Tour operators and especially large ones are not known for being punctual in paying bills. In many cases they have negotiated payment terms that have meant they didn’t have to pay for 120 days! Imagine turning around to your credit card provider and saying to them that you will take their card but you would only pay the bill six months in arrears. You know what their answer would be. But if a big company turns around to a little one and gives them a large contract subject to being paid six months later, many jump at it because who thinks big companies will go bust?

In the UK there is a law that says that companies must be paid in thirty days unless they have agreed separate terms but it isn’t widely enforced partially for the reason I gave about small companies. The company behind Just about Travel is owed a five figure sum by one small tour operator that stretches back to April. Does it send the bailiffs in knowing that most of the furniture, computers and systems are leased so that there is not much of value or does it accept small payments every now and then in order to recoup some of its revenue? Another much larger one is the subject of court action and is spinning the claim out almost in the hope that our directors will cave in because of the hassle.

So that holidaymakers don’t have to face these “hostage” situations in the future isn’t it time for the EU to act. As a considerable chunk of the travel business takes place within Europe a directive enforcing faster payments might help to give some comfort to holidaymakers. Alternatively, a directive saying that it is illegal to re-charge holidaymakers if they have paid for their holidays and that this would be guaranteed by an EU wide fund would also please hoteliers and other accommodation providers giving everyone peace of mind.

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