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Agents ‘mustn’t let collapses cloud the bigger picture’

August 28, 2015 Corporate, Headline News 3 Comments Email Email

egtmedia59Six highly publicised travel agency collapses in recent weeks have triggered a backlash against the deregulation of the industry, calling into question the decision to abolish the Travel Compensation Fund. One travel group, however, views the situation in a different light.

Responding to comments following the collapses, and calls for further debate, MTA – Mobile Travel Agents co-managing director, Roy Merricks said while he agreed productive discourse was a good thing, “the industry must not lose sight of the bigger picture”.

Supporting deregulation, he said, was some very sound research, in the main instigated by AFTA but also drawing on wide-ranging industry consultation across a more than five-year period leading into the launch of ATAS on 1 July 2014.

Merricks said there was nothing to be gained “by change simply for the sake of change”.

The quality of the data in a Regulatory Impact Statement was compelling enough to result in a balanced conclusion “as evidenced by government ratification state by state across the country which in itself was no mean feat”, he said.

“Yes there have been six known agency failures in the twelve months since deregulation – but the reality is that the market is no longer localised geographically and product and process innovation are likely to have much larger consumer welfare effects overall.

“Simply because they can happen now, comprehensive consumer financial guarantees continue to evolve and be developed by several industry networks, all of which are intended to provide consumer protection limited to the insolvency of any of its members, effectively replacing the former TCF consumer protection.

“MTA is one of these networks and we have been extremely proactive in this area.

“In February we launched Zero Flight Risk whereby any client purchasing travel products and services through MTA can rest assured the company will guarantee their funds in the event of any approved travel intermediary or supplier becoming insolvent and being unable to deliver the product or service.

“One year on from deregulation, there is also no doubt the travel landscape has changed and will continue to change.

“But at the end of the day, the bigger picture comes back to education and elevation of standards (ATAS) and continues to be the progressive way forward.”

Edited by Peter Needham


Currently there are "3 comments" on this Article:

  1. Nicky says:

    All well and good for the big players. What about the independent travel agencies lacking the funds for big insurances. Perhaps there should be a TCF style product for the small businesses at a lower cost than the ATAS costs.

  2. Andris says:


    Deregulation ,what is the reality in the market place , self interest of a select group of service providers who had priveleged access to policy makers . There is no mention in the article of corresponding consultation on the issue with consumer groups because clients are not so organised .

    That is the victims actual and potential were not consulted prior to deregulation and the abolition of the TCF .

    Given that some larger groups/ networks of agents may use trust a/c and other means to safeguard client money ,big deal. .Such safeguards should be mandatory best practices universally within any service industry providing a consumer product/ service

    The reality of the insurance market is that no insurer will insure a client against a collapse of a service provider within the Travel industry for sound commercial reasons . The market is to miniscule and only shonks will offer it to there clients if the product is voluntary

    A recent example is the Tasmanian government’s decision re builders warranty insurance . BWI is described by Choice magazine as junk insurance . As a mandatory product the insurers were prepared to sell it in Tasmania . The day the product was made voluntary in Tasmania , every insurer withdrew from the Tasmanian market

    Every travel agent client who as a result of the abolition of the TCF has lost money and their travels disrupted will refute the views expressed in the article and would vote 100% for the immediate re instatement of the TCF and would be very grateful if they were immediately compensated from the $25 million in surplus consumer funds that the state governments intend to pocket as revenue

    Deregulation is clearly only of benefit to a few in the industry and the result is consumer detriment a issue not addressed by Consumer Affair’s Ministers prior to deregulation .

    The evidence is clear consumer protection requires the re instatement of the TCF as in this instance deregulation has resulted in significant consumer detriment were it did not exist previously

  3. Robyn says:

    well Roy, you clearly didnt read all the crap we read, the industry was deregulated with 141 other industries.
    a great deal of the consultation revolved around flight center and the average spend at the time of $5000.
    AFTA was the advisory body that recommended which agencies the govt. to looked at. Unfortunately it didnt include
    independents with an average spend of $12500 almost 3 times that of FC. The entire advisory was most certainly swayed
    in its proposal, and a lack of understanding of the Trust deed did not help. So why do people keep sticking their
    head up to put their 50 cents in. Yes ATAS has come along way is it perfect – who knows as the industry is now
    deeply divided, What will be interesting is the future, and yes Roy the face of travel agents will most certainly change.

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