§ 2.44 p.m.
§ Baroness BURTON of COVENTRYMy Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
§ The Question was as follows:
§ To ask Her Majesty's Government on what grounds they consider that the figure of 141,000 passengers who cancelled their bookings and received their money back justifies the failure to provide seats to 274 people when they attempted to travel on flights for which they had booked; and how many of the 274 people had paid for their flights.
§ Lord JACQUESMy Lords, the circumstances quoted in my supplementary reply to the noble Baroness's Question on 26th June merely illustrates that the off-loading of passengers and the cancellation of bookings are two sides of the same coin. A specific study of the question is being carried out by the Civil Aviation Authority which is the competent body to advise the Government on matters affecting the interests of air travellers. I understand that the Authority is expected to make known the results 777 of this study to the Airline Users' Committee within a few months. The Government will await the results of this work before forming a view. So far as the latter part of the noble Baroness's Question is concerned, I understand from British Airways that there is no reason to suppose that the passengers referred to in my supplementary reply of 26th June had not paid for their tickets.
§ Baroness BURTON of COVENTRYMy Lords, taking the last part first, the House assumes from this that the passengers had paid for their tickets. Can I ask the Minister, who has some knowledge of consumer affairs, whether he can think of any other merchandise which people order, pay for and receive—in this case the flight ticket—which is subsequently removed from their possession?
§ Lord JACQUESMy Lords, at the moment I cannot think of any such merchandise or service.
§ Baroness BURTON of COVENTRYMy Lords, may I then ask the Minister whether he is aware that the report from the Civil Aviation Authority is not likely to be available in the near future, and that it is not likely to reach a conclusion? May I ask him about one other matter. Does he not feel anything on the ethical side of this? Do the Government really feel that people who have paid for goods should have them removed from their possession, and the Government be unable to form a view on this until some committee has reported on their own opinion?
§ Lord JACQUESMy Lords, may I try to help the House by summing up the position showing the differences between the noble Baroness and the Government? I think all of us feel strongly when we hear that a passenger who has booked on an airline has not been able to get on that airline because of overbooking. It generates strong feeling because we know that it is an experience that we should not like, and we are disturbed that other people should have it. So there, I think, we have a point of agreement.
But the record shows that there are two points of disagreement between the noble Baroness and the Government. The 778 first is this: the Government say that there are two sides to this coin; first, there is the cancellation, which is in excess of 10 per cent.; and, secondly, there is the off-loading, which is certainly below 0.02 per cent. So far as the Government are concerned, they are two sides of the same coin. The noble Baroness, by the record, shows that she can see only one side of the coin, and on that point we shall have to disagree. The second point of disagreement is this. The noble Baroness is insisting upon immediate action—
§ Lord JACQUESMy Lords, please let me finish. The noble Baroness is insisting upon immediate action; so far as the Government are concerned, they see danger in this. There are certain remedies which could be applied but would undermine the competitive power of our airlines and increase the fares to our airline passengers. The Government therefore say that the Authority which has been appointed by Parliament to deal with this matter should report before the Government come to a view.
§ Lord GEORGE-BROWNMy Lords, with respect, that really will not do. There are not two sides to the coin.
§ Baroness LLEWELYN-DAVIES of HASTOEQuestion!
§ Lord GEORGE-BROWNMy Lords, I am sorry, I did not hear what the noble Baroness said.
§ Lord GEORGE-BROWNMy Lords, my question now starts, and I am obliged to the noble Baroness, who has been so long in public affairs, for reminding me. If I am the chairman of a company, as I am, and people cry off, having invited my services, there is nothing I can do about that; but when people have bought my services and paid for them, if I do not deliver could I ask the noble Lord whether I am not at risk of prosecution for trading fraudulently? Will he please tell me what is the difference between the law applied to my company and the law applied to his airline? They are trading fraudulently if they do not—
§ Lord GEORGE-BROWNMy Lords, I am asking whether they are not trading fraudulently if, having taken the money, they do not deliver the services? We have a law—
§ The MINISTER of STATE, DEPARTMENT of INDUSTRY (Lord Beswick)My Lords, the noble Lord is probably asking a question, concealed. Could he ask a short question?
§ Lord GEORGE-BROWNYes, my Lords—
§ Lord GEORGE-BROWN—and I seem to be particularly popular at the moment with Members of the Front Bench opposite. I will make my question very short. Would the Minister please tell me whether his airlines are trading fraudulently?
§ Lord JACQUESMy Lords, the answer is, No.
§ Lord HAILSHAM of SAINT MARYLEBONEMy Lords, on a point of order, is there not, in fact, a Petition for leave to appeal on this very point now pending before your Lordships' House?
§ Lord JACQUESThere is, my Lords.
§ Baroness BURTON of COVENTRYMy Lords, is the application for leave to appeal not being heard tomorrow, and is it not a fact that until it has been heard it cannot be granted and that until it has been granted it cannot be sub judice, so that it is therefore open for discussion today?
§ Viscount HANWORTHMy Lords, while regretting this practice as much as does the noble Baroness, may I try to put it in perspective by asking two questions? First, if this were done away with and there was not overbooking, by what percentage is it likely that fares would have to rise? Secondly, what is the number or percentage of passengers who do not get on those flights on which they are booked because of other causes, such as aircraft unserviceability, strikes and so on?
§ Lord JACQUESMy Lords, the answer to the first part of that supplementary question is that, as there are 10 per cent. or more cancellations, fares 780 could have to be increased by up to 10 per cent. I regret that I do not have the information sought in the second part.
§ Lord ELTONMy Lords, may I ask the Minister if the 274 people referred to in the latter part of the original Question got back their money, and how long it took for them to get it back? Did they receive compensation, first, for inconvenience and, secondly, for consequential loss owing to the change of their arrangements?
§ Lord JACQUESMy Lords, in the majority of cases they went on the next available flight and there was no loss. In so far as there was a loss, they were paid expenses up to £20. Anybody who did not fly got back the whole of the money.
§ Lord LEATHERLANDMy Lords, would it not be possible to refuse to allow people to cancel bookings and get back their money? That would ensure that while 141,000 would suffer, the 274 would be sure of getting their seats.
§ Lord JACQUESMy Lords, that is one superficial answer to this question. The position is that there have been several attempts to reach an international agreement on a penalty for cancellation. Those attempts have failed and if our airlines inflicted a penalty and the others did not, that would undermine our competitive position.
§ The Earl of ONSLOWMy Lords. what was the value of those 274 tickets which had to be refunded? How much extra cost did this bear in relation to the total ticket turnover of British Airways?
§ Lord JACQUESMy Lords, I do not have my calculator with me today.