§ Mr. McCrindleasked the Secretary of State for Transport when he expects to publish the results of the independent review into the present arrangement for protecting air package holidaymakers.
Mr. MitchellThe report by Sir Peter Lane on his review, including his recommendations, is being published today. I have arranged for copies of the report to be placed in the Library.
Sir Peter was asked to review the arrangements for licensing air travel organisers and for protecting their 820W clients against financial loss and in particular to consider a number of questions: the roles of the bonding system and the air travel reserve fund and whether they provide adequate protection; if not, whether they should be strengthened and how; whether alternative arrangements would be preferable and if there is a role for the insurance market; whether protection should be extended to scheduled air passengers; and the criticisms and proposals put forward by the chairman of the Air Travel Reserve Fund Agency in his last annual report.
I should like to express my thanks to Sir Peter for the speed and care with which he has conducted this valuable review.
Sir Peter was not persuaded that either the consumer or the industry would benefit from any fundamental change in the present system. He concludes that the present level of the fund is adequate and I welcome his reassurance on this. Sir Peter recommends, however, that the existing arrangements should be strengthened in certain respects. He found no enthusiasm within the industry or from representatives of the insurance market for the replacement of the present arrangements by insurance and he does not regard this as a practicable option.
I should welcome the views of those involved with the travel and insurance industries on what Sir Peter proposes. I am disappointed at the apparent lack of interest by the insurance industry in the idea of replacing the present arrangements with insurance. The industry has a worldwide reputation for its ability and willingness to underwrite a very wide range of risks. I shall especially value its comments on what Sir Peter has to say. I hope to make a further statement after the House reassembles giving our decisions on Sir Peter's proposals. It would be helpful to have comments on the report by the end of September.
Meanwhile, I am accepting Sir Peter's recommendation that the Government should undertake to reimpose a levy on the holders of air travel organisers' licences if future claims seriously reduce the size of the fund. Accordingly I can say that, as long as the present arrangements for protecting air package holidaymakers continue, my right hon. Friend would, subject to parliamentary approval, be prepared to reimpose a levy in the event of a substantial reduction in the size of the fund.