18. Mr. R. C. Mitchell
asked the Secretary of State for Trade and Industry how many firms operating package tours at home and abroad have applied to him to increase their prices for the 1973 season; and what replies he has sent.
§ Mr. Anthony Grant
Problems affecting package tour operators have been dealt with through the Association of British Travel Agents. We have agreed that operators may levy surcharges on package holidays abroad only so far as necessary to reflect currency fluctuations and cost increases in individual countries 972 beyond their ability to control. The association has also approached my Department about other increases for the 1973–74 season and its views are being considered.
Is the hon. Gentleman aware that nearly all the holiday firms have very substantially increased their prices for the 1973 season? Did he read the article in yesterday's Sunday Times on this point? Is he further aware that many firms, including Butlin's, are sending out invoices with the full 10 per cent. value added tax charged on them?
§ Mr. Grant
The answer I gave is that the only agreement which the Government have made is on overseas holidays, because of currency changes. As far as home holidays are concerned, travel firms are in precisely the same position as the rest of industry. Deals not concluded before the Government standstill come under the counter-inflation policy.
§ Mr. Kenneth Lewis
Is my hon. Friend aware that any increases which have taken place are almost entirely due to the floating £, which made them necessary, and that these holidays are still the cheapest bargain available? Is he further aware that many of these companies are losing money?
§ Mr. Arthur Davidson
Will the hon. Gentleman take this point seriously? Is he aware—he probably is not—that I have had complaints over the weekend from constituents who say that they are now no longer able to take the same holiday they went on last year because of increased charges, some of which are called "general increases", while in addition they have already been charged the 10 per cent. increase for value added tax? Will the hon. Gentleman look into this?
§ Mr. Grant
If the hon. Gentleman will give me details of the cases he has in mind I will do so. What I want to make clear, as I have done on a number of occasions, is that any excuses for increased charges over and above the VAT figure of 7 per cent. or in some cases 10 per cent. are wholly unjustified on VAT grounds. In other respects the industry is in precisely the same position as other industries.