Refunds: packaged holiday firms 'still misleading' holidaymakers

Would-be holidaymakers are still being misled over their rights to a refund if their holiday is cancelled due to Covid.

If you’re starting to think about a holiday in sunnier climes, you’re certainly not alone. 

After the difficulties of the last year, plenty of Brits are starting to daydream about the possibility of heading overseas in the near future, with the Government promising more details on its proposed traffic light scheme ‒ which will dictate which countries we can head to, and what the quarantine regime will be on our return ‒ in the weeks ahead.

However, it would appear that some things haven’t changed, with holiday firms still playing dumb over holidaymakers’ rights to refunds should trips have to be cancelled once more due to the pandemic.

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Misleading travellers

A year ago, as Covid-19 first hit the UK and led to the cancellation of thousands of holidays, a big issue was the way that holiday firms resisted offering people cash refunds, as they are supposed to by law.

It was something that we covered extensively at the time, and in the months since as some have continued to drag their heels over handing back cash to their customers.

What’s more, a new study by Which? suggests that little has changed, with packaged travel companies continuing to mislead holidaymakers over their rights.

A mystery shopping exercise by the consumer champions focused on six big packaged holiday firms, with the Which? team posing as travellers and asking those firms if they will get their money back if lockdowns or quarantine prevent them from travelling.

Of the six, only Trailfinders and Tui committed to reimbursing both flights and hotels within 14 days if the Government banned travel, as is required by law.

The other four ‒ TravelUp, Teletext, Love Holidays and On The Beach ‒ suggested that full refunds would depend on whether the airline actually cancelled the flight.

It was a similar story with quarantines. Denying a refund if a traveller is required to quarantine on arrival is in breach of package travel regulations, yet once again only Tui and Trailfinders would commit to handing back the cash.

While the other packaged holiday firms later provided official statements contradicting what their agents had told the mystery shoppers, the reality is that clearly the rules aren’t that well understood by their staff, leaving us at the risk of losing our money unfairly.

As Rory Boland, editor of Which? Travel, put it: “Whether you can book with confidence ultimately comes down to who you book with.

Many of the companies that broke the law last year have suggested they may do so again, so regulators must be ready to take strong action against any operators found to be misleading their customers or breaking the law.”

The role of the CMA

It’s worth highlighting the work that the Competition & Markets Authority (CMA) has done in trying to get travel firms to meet their responsibilities.

In July last year it wrote to over 100 package holiday firms, after receiving more than 17,500 complaints about difficulties holidaymakers had had in getting refunds following holiday cancellations because of the pandemic.

And that action was effective in securing refunds from a host of big names, including the likes of Virgin Holidays and Lastminute.com.

But some are still resisting doing the right thing.

Just last week, the CMA named and shamed Teletext Holidays for failing to pay an incredible £7 million to holidaymakers in refunds and warned that it faces court action if it doesn’t pay up, or at least confirm plans to do so, as soon as possible.

Give regulators proper powers

This does simply highlight an ongoing problem though, which is that the CMA itself doesn’t have the powers at its disposal to actively punish the lawbreakers.

We are more than a year on from the arrival of the pandemic, and let’s be honest, these holiday firms know only too well what they should be doing.

But they also know they can drag their heels and muck people about because the regulatory bodies, like the CMA, don’t have the teeth needed to act effectively. 

Until we address that  – and give regulators the power to punish rulebreakers properly  – then we should prepare ourselves for less reputable businesses continuing to take their customers for a financial ride.