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Coronavirus UK: £7bn owed to holidaymakers for cancelled trips

The UK’s biggest tour operator, TUI, has extended the suspension of its holidays for the next six weeks, having previously suspended operation until May 14.

The company announced that all trips would be cancelled up to and including June 11, and warned customers wanting cash refunds that their call centres are ‘incredibly busy’.    

Meanwhile, thousands of British holidaymakers are owed £7billion for trips cancelled because of the global coronavirus pandemic with banks and airlines flouting the law by refusing refunds, it was revealed today.

There is growing anger that the Government has not intervened when lenders and travel firms are illegally withholding cash that should be paid within a week for flights and 14 days for package deals.

The Competition and Markets Authority has revealed that four out of five complaints it is getting every day is from British consumers being denied travel refunds and the UK watchdog will soon announce a new crackdown.    

Airlines including British Airways, easyJet, Jet2, Virgin Atlantic, Ryanair and TUI have been accused of flouting the law and pushing customers to accept credit-note vouchers which have little consumer protection and could prove worthless if a carrier went bust.

Ryan Simmonds, 40, and Jo-anne Harold, 30 had to rebook their wedding TWICE - and are now being asked to pay an extra £19,000 to secure their flights and accommodation

Ryan Simmonds, 40, and Jo-anne Harold, 30 had to rebook their wedding TWICE - and are now being asked to pay an extra £19,000 to secure their flights and accommodation

Ryan Simmonds, 40, and Jo-anne Harold, 30 had to rebook their wedding TWICE – and are now being asked to pay an extra £19,000 to secure their flights and accommodation

Ryan proposed outside the Cinderella Castle, Disneyworld Florida in September 2018 and they planned to have their wedding there this August before the event was cancelled due to coronavirus

Ryan proposed outside the Cinderella Castle, Disneyworld Florida in September 2018 and they planned to have their wedding there this August before the event was cancelled due to coronavirus

Ryan proposed outside the Cinderella Castle, Disneyworld Florida in September 2018 and they planned to have their wedding there this August before the event was cancelled due to coronavirus

British Airways said yesterday it is making up to 12,000 workers redundant and last week Richard Branson asked the government to bail out for his struggling Virgin Atlantic company, for around £500million.

While travellers who booked breaks using credit cards are also struggling to get cash back from banks, despite Section 75 of the Consumer Credit Act enshrining refunds in law.

Instead lenders have told their own customers they are not eligible for cash refunds, or demanded they pursue the cash from the travel firm first, which is not a legal requirement.

The Association of British Travel Agents (Abta) has even been lobbying ministers to relax rules requiring airlines to issue refunds within a set timeframe — although most have ignored them anyway and appear to have been using underhand behaviour to avoid paying. 

How airlines bend the rules

British Airways: The refund option has been removed from its website but the option to claim a voucher remains. The customer service line is frequently engaged or puts callers on hold for hours.

Customers are being encouraged to apply for a voucher equal to the value of their flight but must pay more if it ends up being more expensive.

BA says customers should call to rebook, refund or choose a voucher. Refunds can be requested up to 12 months after the original departure date.

EasyJet: The refund option was taken off the website, but reinstated after customer complaints.

The airline is trying to refund customers within 28 days, but admits it could take longer. A spokesman says: ‘We assure customers these entitlements will be available long after their cancelled flight was due to fly.’

Ryanair: Offered full reimbursement within 30 working days, then did a U-turn and is ‘highly recommending’ customers apply for a voucher instead. Says customers will be able to exchange vouchers for cash after a year.

A spokesman says: ‘Customers who choose a voucher but don’t redeem it within 12 months may still apply for and obtain a refund. 

Customers who choose not to accept a free move or voucher will be refunded in due course, once this crisis is over.’

Virgin Atlantic: Credit notes are being issued but can be rejected in favour of a full refund, with claims processed within 90 days. 

A spokesman says: ‘The credit [equal to the value of the cancelled flight] can be used to rebook on alternative dates, allowing for a destination and name change, for travel until May 31, 2022. 

If the rebooked date is before November 30, 2020, we’ll waive any fare difference.’ Refunds will take longer than normal.

Tui: Customers can choose a refund or credit note but can only apply for their money back once their refund credit has been received — up to four weeks after the departure date. 

A spokesman says requested refunds will take about four weeks.

Jet2 is offering cash refunds but with delays because of an ‘unprecedented’ number of calls.

Jo-anne Harold, 30, and Ryan Simmonds, 40, are two of many people to be out of pocket thousands after they had to cancel their wedding TWICE.

They were colleagues at Birmingham Airport for 11 years before they started dating and are now being asked to pay an extra £19,000 to secure their flights and accommodation.

After Ryan proposed outside the Cinderella Castle, Disneyworld Florida in September 2018, the pair knew it was the only venue for their wedding, scheduled for August 25 this year.

But the pair from Wednesfield, Wolverhampton have had to rebook their 80-person wedding twice, thanks to the collapse of Thomas Cook and coronavirus.

Now they are being told they have to pay an extra £10,500 to secure their flights and accommodation for their wedding in April 2021.

Jo-anne said: ‘British Airways just don’t want to help us – they are saying that we’re not getting refunds, we won’t get flight vouchers.

‘And if we want to transfer to April, we’ve got to pay the fare difference which is currently £1600 per person.

‘We only paid £518 to start with.’

Money has also been demanded to secure the villas in April.

Jo-anne said: ‘I don’t think they can be arsed to deal with it – they’ve taken our money, got their commission from the first flights we paid for, and then they don’t want to deal with us.

‘Then the person who we booked the villas through, she then tried to charge us another £10,500 on top if we want to go in April.’

Pamela Harold, 65, Jo-anne’s mum, booked the original flights and villas with Thomas Cook.

Jo-anne said: ‘Originally my mum went to the travel agents and booked all 80 guests – she sat in the travel agents for seven hours – on the same flight, got villas on the same complex, and everything was sorted through Thomas Cook.

‘We paid £40,000, in full.

‘We had to go on a waitlist for a year to get our slot for Disney and once we got that, everything was sorted.

‘Then Thomas Cook went bust and we had to rebook the whole thing again.

‘I was on nights at work and so I knew Thomas Cook had gone bust so I waited up after my night shift – I called BA straight away.

‘I got all 80 guests rebooked again, and then I spent a good few hours – because of the time difference in America – contacting America to get all the villas rebooked.

‘All of it was sorted, and now this has happened.’

The pair said Disney has been really helpful, changing their wedding from August 25 this year to April 5 2021.

But they claim British Airways have not been so supportive. All 80 guests are still booked on flights for August 2020.

Jo-anne said: ‘When I rang to enquire, [British Airways] basically said ‘we’re not giving refunds, we’re not giving vouchers.’

‘We’ve been calling up for a month because they keep saying call in a week, the flights will be in.

‘We’ve been calling for over a month now and everytime we ring back, they’re like ‘the flights are not in yet.’

‘But they are, because they are selling them online on British Airways.’

Pensioners Paul and Wendy Cary have been left badly out of pocket after their BA break was cancelled - thousands of Britons are in the same boat

Pensioners Paul and Wendy Cary have been left badly out of pocket after their BA break was cancelled - thousands of Britons are in the same boat

Pensioners Paul and Wendy Cary have been left badly out of pocket after their BA break was cancelled – thousands of Britons are in the same boat

Pensioners Paul and Wendy Cary, from Hampshire, are thousands of pounds out of pocket after their British Airways holiday to Barbados was hit by the travel ban. 

The couple feared they would be stranded in Barbados when BA cancelled their return flight on March 23, a week before they were due to travel and say the airline is ignoring their complaints. 

The last BA flight back was on March 26, so they knew they had to get on one before then. Paul, 72, could not get through to customer services. His BA online account did not show any available seats on another flight. BA offered a voucher for the cancelled flight but it could not be redeemed for the next seven days.

Finally the couple, from Hook, Hampshire, tried booking as new customers and found two economy seats on a flight leaving on March 25, costing $3,671 (£2,958). Their original flights cost £1,821 return. Paul says: ‘We had to pay. The apartment we were staying in was closing down.’

Back home, the Carys filled out an online complaint form but the airline will only offer vouchers for the original flights it cancelled. Paul says: ‘This has really left us struggling financially. We are both on a state pension.’  

Sarah Durling, 31, a police officer for Cheshire Constabulary, is owed £600 in refunds for a holiday booked with Hoseasons 

Sarah Durling, 31, a police officer for Cheshire Constabulary, had booked herself a holiday with her two young children, Harry, four, and Ollie, two, to stay in a chalet in Penrith, Cumbria.

She was planning to meet up with two school friends, and had planned the holiday months in advance – finding a rare window when they could all take the week off.

Sarah, from Upton, Merseyside, booked the £600 holiday with Hoseasons, but it was cancelled due to the pandemic – and so far she has been unable to get her money back.

She said: ‘I planned to see my friends, we never get to see each other because we all have our own lives.

‘We’ve been best friends since we were 15 and we finally found some time where we could all take it off.

‘It was cancelled due to the coronavirus. I don’t begrudge Hoseasons for that decision, but I haven’t been able to get my money back.

‘I’ve called and emailed but I’ve had no reply. They’ve said we can rebook, but I don’t want to do that – I want the money back.

‘They’ve just ignored me. That money could be used to feed the kids or pay the bills. My partner, Gareth, has just been laid off too so the money would be helpful now.’

Sarah was set to go on holiday with her children, Harry, four, and Ollie, two

Sarah was set to go on holiday with her children, Harry, four, and Ollie, two

They were planning to stay in a chalet in Penrith, Cumbria

They were planning to stay in a chalet in Penrith, Cumbria

She planned the holiday with her two young children, Harry, four, and Ollie, two, to stay in a chalet in Penrith, Cumbria

Joanne Skitt, 49, booked a two-week break in Turkey for herself and her partner, Steven Carrington, 48.

They paid over £2,000 for the holiday with Tui, and so far all they have been offered since the cancellation is a refund in company credit.

She said: ‘We were told not to contact them because there was so much going on, and we hadn’t heard anything by the date we were due to fly.

‘The next day we read online that everything was cancelled and we could get a credit note from Tui.

‘We don’t want a credit note, holiday’s are the last thing on our mind right now and that money could be used elsewhere.

‘I’m also worried the company could go bust so the credit will be worthless.

‘We were looking forward to the holiday, we had been planning it for months. We always like to book in advance so we have something to look forward to.’

Steven Carrington, 48, and Joanne Skitt, 49, booked a two-week holiday to Turkey for £2,000 but have been unable to gain a refund

Steven Carrington, 48, and Joanne Skitt, 49, booked a two-week holiday to Turkey for £2,000 but have been unable to gain a refund

Steven Carrington, 48, and Joanne Skitt, 49, booked a two-week holiday to Turkey for £2,000 but have been unable to gain a refund

Simon Joyce, 55, was due to go on honeymoon to Nashville and New Orleans with his wife on April 9, but had his American Airlines flights cancelled.

He went to the tourism agency Gullivers Travels to ask for a refund but was offered a credit not or to rebook the flight instead.

Simon, from Preston, said: ‘I insisted that I wanted my money back as I am legally entitled to it and was told that refunds where being dealt with in date order and to wait until 72 hours before I was due to fly.

‘By now we would have had our honeymoon and been back home – and we still have not been offered our money back – I have now been told that it may take American Airlines up to 8 weeks to have my request processed and still may not get a refund.

‘I was told to claim on my travel insurance to get a refund but when I pointed out that there would be an excess there was no offer to pay that and why should the insurance company pay me – it’s the travel agents and airlines who owe this refund.’  

Pensioner Nathalie Franks saved up for three years to go on the ‘holiday of a lifetime’ with friends to Israel.

Her tour company cancelled the trip and because she booked her flight last October to get the best price possible, she is not eligible for British Airways flight vouchers.

She was told she could only receive the vouchers if she booked between March and May this years and is now out of pocket £549 for the flights alone.

Ms Franks said: ‘I am so disheartened. I feel abandoned by the system.’ 

Simon Joyce, 55, from Preston, booked a honeymoon to Nashville and New Orleans with his wife on April 9 but was denied a refund from the travel company after his American Airlines flight was cancelled

Simon Joyce, 55, from Preston, booked a honeymoon to Nashville and New Orleans with his wife on April 9 but was denied a refund from the travel company after his American Airlines flight was cancelled

Simon Joyce, 55, from Preston, booked a honeymoon to Nashville and New Orleans with his wife on April 9 but was denied a refund from the travel company after his American Airlines flight was cancelled

Airlines are using underhand tactics to make it almost impossible for holidaymakers to claim refunds for cancelled flights.

Hundreds of readers have contacted us to complain major airlines are illegally withholding refunds that should be paid within a week.

Many say they have been goaded into accepting credit-note vouchers which have little consumer protection and could prove worthless if an airline went bust.  

Others describe refund processes as unclear, complex or time-consuming, forcing them to give up.

Will the rules be changed on refunds? 

Industry insiders have suggested that the Department for Transport (DfT) is set to make an announcement on the issue after weeks of inaction.

The Association of British Travel Agents (Abta) has been lobbying ministers to relax rules requiring airlines to issue refunds within a set timeframe — although most have ignored them anyway.

They want credit notes to retain Atol protection, giving reassurance to holidaymakers who fear their money will disappear.

The situation has been worsened by uncertainty about when flights will resume. The International Air Transport Association (IATA) has warned that the industry is facing an ‘apocalypse’ and more than half the world’s carriers could go bust.

EasyJet has received a £500 million emergency loan from the Treasury. But the future looks less hopeful for Virgin Atlantic, whose request for state aid was refused.

Even BA boss Alex Cruz has warned that the nation’s flag-carrier faces a fight for survival. In a dramatic announcement to staff yesterday, the company said it was making up to a quarter of them — 12,000 people — redundant.

But an Abta spokesman says: ‘Customers whose holidays have been cancelled because of the pandemic absolutely have the right to a refund, and where cash refunds are requested they should be given as soon as possible.’ 

 

Last night, the powerful Commons transport committee of MPs confirmed plans to investigate the issue in a series of hearings with aviation bosses next week.

Under EU law, passengers are entitled to a full refund on the cost of a cancelled flight within seven days, or 14 days if they have booked it as part of a package.

But carriers are delaying issuing refunds for fear of going bust — so holidaymakers’ cash is essentially being used as interest-free loans for crisis-hit airlines.

This is having a knock-on effect on package holiday companies, who are also waiting for airlines to repay them before they can issue their own refunds.

Critics say a lack of government action on the issue has turned the travel industry into the Wild West, leaving families out of pocket at a time when many are under financial strain. Industry estimates suggest companies are sitting on £7 billion in unpaid refunds.

The committee chairman, Tory MP Huw Merriman, said: ‘Yes, airlines have a need for cash but this should be drawn from their lenders, not from passengers who are legally entitled to a refund. 

‘Many people have their own financial worries and may not be able to use a future travel voucher.’

BA has been accused of acting disgracefully by removing a refund option from its website, while retaining the option to receive a credit-note voucher towards a future flight. 

Passengers are told to call a customer service number — but the line is frequently blocked. When we called this week, it played an automated message, then cut out.

EasyJet customers have also described endless waits to speak to customer service. It is, however, easy for customers to claim a credit note valid for a year.

Ryanair, Virgin Atlantic and TUI are also offering credit notes automatically. These can be rejected in favour of a full refund.

However, Ryanair has warned that passengers who want their money back will be ‘placed in the cash refund queue until the Covid-19 emergency has passed’.

Virgin Atlantic is in crisis and could collapse at the end of May unless a buyer is found. This would render any credit notes worthless, unless the Government steps in to protect vouchers under Atol. Then, even if an airline folded, customers would get their money back.

Wizz Air has resumed flights from Luton to several destinations in Europe this week, meaning passengers who do not wish to travel are denied the right to a refund. 

Consumer champions Which? say the move was ‘nothing more than a cynical cash grab’. 

 ‘It’s not right that they are hanging on to my money, collecting the interest for themselves, while I am forced to spend the £1,000 even if I don’t need to or want to’

Hazel Smith, 58, from Weymouth, says British Airways refused to refund her flight to Tokyo

Hazel Smith, 58, from Weymouth, says British Airways refused to refund her flight to Tokyo

Hazel Smith, 58, from Weymouth, says British Airways refused to refund her flight to Tokyo

A mother has told how British Airways used a loophole to avoid giving her a refund for her flight to Tokyo. 

Hazel Smith, 58, from Weymouth, was due to fly to Japan tonight to visit her grown-up daughter who lives and works there.

With the coronavirus pandemic grounding aeroplanes around the world, she phoned BA customer services to request a refund of the £1,000 she had paid.

But she was told that the flight was a ‘codeshare’ agreement, meaning that although it was sold by BA, it was actually run by Japan Airlines.

That company had not cancelled the flight but was only allowing Japanese nationals to travel, meaning that there was no way Mrs Smith could fly.

‘British Airways told me that since the flight was technically not cancelled, I wouldn’t be getting my money back,’ Mrs Smith told MailOnline.

‘It felt like a total cop-out. BA was fully aware that British citizens couldn’t fly on the Japan Air flight, but they were using a loophole to avoid refunding my money.

‘They offered me a voucher. But I have no use for a voucher as my daughter might be moving back to Britain and I wouldn’t need another flight.

‘It’s not right that they are hanging on to my money, collecting the interest for themselves, while I am forced to spend the £1,000 even if I don’t need to or want to.’

A British Airways spokesman said: ‘Our Book with Confidence policy has been updated to offer even more flexibility, details can be found on our website.’ 

 

Courtesy DAILY MAIL

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