TCF comes out fighting for its future

TCF comes out fighting for its future
By admin


The Travel Compensation Fund has come out fighting as it warned that scrapping the consumer refund scheme and eliminating travel agent licensing could come back to haunt the industry.

While stressing that its submission to the draft Travel Industry Transition Plan was not intended to “suggest or advocate” a decision, the 22-page document spells out what it believes are significant risks in the event of the TCF being axed.

It warned that consumer confidence in the industry may be damaged when a company collapses in a post-TCF world and suggested existing safeguards under consumer protection laws are “impractical, unavailable or too costly for individual consumers”.

“Under the proposed plan, consumers will need to take legal action individually or within a class action to recover lost funds which will be costly, time consuming and unlikely to provide them with financial relief,” the TCF said. “Such legal actions are unlikely to be available, or pointless where the travel agent is bankrupt or otherwise insolvent.”

It argued that if a wholesaler collapses and there is no TCF to pick up the pieces, consumers could well hold the retailer responsible for passing on money which is subsequently lost.

Brand or goodwill damage could result for the agent, the TCF said.

A further damaging implication could see consumers prefer to deal with larger, better known agents who the public perceive as being more financially stable.

The TCF also rejected the claim that payments by credit card is increasing and therefore protecting consumers.

“The use of credit cards is not as common for travel purchases in Australia as may be thought,” it said. “Most recent TCF experience with claims is that credit card purchases are declining in favour of other means of payment.”

Later in its submission, the TCF tackled one of the scheme’s fundamental flaws – that its remit is not wide enough. That could be solved if more travel businesses were subject to licensing and compulsory TCF participation.

While "the TCF cannot unilaterally extend its own coverage", that could be achieved through legilsation.

Should the reform proposals be ratified, the TCF insisted that its $31 million reserves continue to be used to compensate consumers “until the best/alternative scheme is actually implemented”.

In addition, the cash should fund a travel industry ombudsman and to establish a travel consumer advocacy centre which could provide education, advice and help in matters of travel consumer issues.

Email the Travel Weekly team at traveldesk@travelweekly.com.au

Latest News

  • Aviation

Low-cost Indian carrier SpiceJet continues to burn cash

It’s not just low-cost Australian carriers that are facing hardship. SpiceJet, India’s version of Bonza, recently announced a 72 per cent reduction in its net loss versus last year. But, despite this improvement, the airline has posted losses for six straight years. But it has secured board approval to raise up to INR 30 billion […]

  • Attractions

SAKA Museum recognised in TIME magazine’s World’s Greatest Places 2024

AYANA Resort Bali’s newly-opened cultural and events centre, SAKA Museum has been recognised in TIME magazine’s World’s Greatest Places list for 2024. Part of AYANA Bali’s resort destination, the museum integrates Bali’s rich history with state-of-the-art facilities, making it the centrepiece for the island’s spiritual and cultural heritage. TIME magazine’s inclusion of SAKA Museum in […]

  • Cruise

Silversea taps Barbara Biffi as senior vice president for global sales

Ultra-luxury and expedition cruise travel brand, Silverseas, has announced Barbara Biffi as its new senior vice president of global sales. Biffi joined the company in 2007, holding numerous positions and gaining a deep understanding of the brand, the preferences of its guests and its strategic goals, the company said. An Italian national with a wealth […]

  • Technology
  • Travel Agents

Amadeus welcomes FCM Travel as new reseller partner of Cytric Easy

Cytric Easy, the travel management tool embedded in Microsoft Teams, is to be integrated into FCM Travel portfolio. Amadeus and FCM Travel have extended their Cytric distribution agreement to include Cytric Easy. With this new agreement, global travel management company FCM Travel, becomes a reseller of the innovative travel management collaboration solution embedded into Microsoft […]