p4 sep19 17/9/08 20:25 Page 4
news
19.09.2008
XL COLLAPSE SPECIAL
■ News in full, p4-9
XL failure revives■ Commission ‘threat’, p12
■ City analysis, p16
■ Letters, p48
calls for a £1 levy
CAA defends XL’s
Lee Hayhurst.
are successful or not might depend on how
last Atol in April
THE GOVERNMENT has come under renewed embarrassed the government is about XL.”
pressure to consider a flat levy on all flights to Josephides said that despite the claims of
protect customers following the collapse of XL scheduled airlines, they were no less likely to
THE CAA has defended its decision to grant XL Leisure Group last week. fail than operators, and that the latter were
an Atol in April and said if it were to increase Abta, Aito and the Liberal Democrats have “intrinsically more profitable”. He added: “This
its financial scrutiny of companies, the cost all written to the Department for Transport to is why airlines want to become operators but
would fall on the trade. demand the protection mess is sorted out, and they do not want to put up the finance.”
Questions have been raised about the CAA’s Tui Travel has also called for action. Abta chief executive Mark Tanzer said: “The
role in the XL collapse, which came five months A previous attempt to prompt the government failure of XL demonstrates the virtue of financial
after the £1 Atol Protection Contribution began. to bring in a £1 levy, backed by TTG’s Just a Quid protection, and the risks of travelling without it.
XL’s former auditors, KPMG, quit in 2006, say- campaign, failed by just three votes in the House “We shall renew our call on government to
ing it was “no longer able to conclude that the of Commons in 2005. address this as a matter of the utmost urgency.”
financial statements gave a true and fair view”. But it is hoped that the XL collapse will Tui Travel managing director Dermot Blastland
But Richard Jackson, CAA consumer protection bring the issue back to the top of the political said the firm was frustrated with the govern-
group director, said there was only so much the agenda and that the stories of customers left ment’s lack of action. “For quite some time we
CAA can do to investigate Atol holders. without protection will sway politicians. have been lobbying the government to recognise
“The reason XL was still operating was it was Noel Josephides, Aito and Abta director, said the need for a level playing field,” he said.
being supported by its banks pending what that he could see no reason at all why the Supporting calls for a flat £1 levy, Lib Dem
everyone hoped would be a successful refinancing. existing £1 levy on Atol holidays could not be shadow transport secretary Norman Baker said:
“We did not set up APC to prevent failures, if a extended. “It’s a small price to pay for the certainty of a
company’s going to fail its going to fail,” he added. “It’s the only way,” he said. “Whether we ticket home.”
Wyatt reveals his plan to rescue clients was rejected
XL boss Phil Wyatt proposed a contingency plan I personally don’t believe that is the case.”
to keep the group’s aircraft flying in the event of David Moesli, the CAA’s deputy director for
a collapse – two weeks before it went bust. consumer protection, said: “We were very keen
But his proposal, which could have averted the to see if we could keep those planes flying.
need to repatriate 85,000 customers stranded “We were playing our role in this, but the gov-
overseas, was rejected because administrators ernment also had a role because Kroll was look-
could not be given financial assurances. ing for an indemnity but it was not possible to
Administrators Kroll wanted the government give the administrator the protection it wanted.”
to offer indemnities to offset the risk of running Wyatt said talks about finding new investors
the airline during the repatriation period. continued until 9pm on Thursday, and some
Wyatt (left), XL’s chief executive, said: “I went “individuals” were interested even at that stage.
to see the CAA to explore the option that in the He said refinancing efforts would have been
event of our Atols being withdrawn we could fly easier if the group’s former Icelandic owner,
planes with our crews. Eimskip, had released a note regarding loan
“Unfortunately, it was deemed by authorities, guarantees earlier.
P
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government, whoever, that this was impossible. “This business would not have failed,” he said.
04 19.09.2008
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