Holidaymakers face threat of £100 surcharges

Britain's travel bosses asked the Government yesterday for the right to demand bigger surcharges on package tours in a move that could add £100 or more to the cost of a family holiday.

Britain's travel bosses asked the Government yesterday for the right to demand bigger surcharges on package tours in a move that could add £100 or more to the cost of a family holiday.

The board of the Association of British Travel Agents (Abta) has also requested the right to levy the charges within a month of the date holidaymakers are due to set off. The Consumers' Association condemned the action as "totally outrageous".

Late-notice surcharges were a feature of the bad old days of package holidays in the 1970s and 80s, alongside half-built hotels and bankrupt tour operators. The charges were supposed to cover exchange-rate fluctuations and fuel price rises, but some unscrupulous operators imposed extra fees almost as a matter of routine. The law has since been tightened, and only a handful of Abta companies have applied to impose a surcharge in the past five years.

The four big holiday companies – Airtours, First Choice, JMC and Thomson – have been faced with a sudden increase in their costs since the terrorist attacks of 11 September.

Many operate their own charter airlines, which have become more expensive to run because of higher insurance premiums and new security measures. In addition, some hotels are increasing their charges in the aftermath of the attacks on America.

At present, holiday companies must absorb cost increases of up to 2 per cent of the package price – representing about £10 on the average package to a Mediterranean resort. They cannot apply a surcharge within one month of the departure date but Abta wants the right to apply the full amount up to 20 days before the holiday starts.

Many airlines have already imposed surcharges – the latest being British Airways, which from Friday will levy an extra £2.50 on the price of each flight. If the flight is part of a package holiday, the extra cost is passed on to the tour operator.

Abta's head of legal services, Riccardo Nardi, said: "At the moment, tour operators are in an even more difficult position than the airlines. They cannot pass on even a small element of the additional costs they're facing because of the 2 per cent rule". Ironically, a decade ago Mr Nardi lobbied the Government successfully to apply the rules that he is now seeking to reverse. "The tourism industry has been turned on its head by the events of 11 September," he said. "They're trying to plan holidays 18 months ahead with absolutely no certainty of what their cost position is going to be."

Gary David, managing director of Cadogan Holidays, said people could expect "lots and lots" of surcharges next summer because tour operators could simply not afford to absorb the increased costs.

Kim Winter, managing editor of Holiday Which? magazine, warned that tour operators could use a change in the law as "a licence to abuse" their customers. "We find it very difficult to believe that the industry is incapable of estimating what those increased costs are going to be," he said. "The sensible way to respond is to increase published prices in the brochures and then to discount if the costs don't materialise."

Faced with a decline in bookings of about 30 per cent, Britain's travel industry has been seeking to reassure the public that choosing holidays a year ahead is safe. One Abta delegate opposed to higher surcharges said: "This is giving the punter exactly the wrong message; 'Book now, but we reserve the right to push the price up later'. We can't afford any more bad publicity."