MPs have suggested that the UK’s Civil Aviation Authority (CAA) be given more power to punish airlines who fail to refund passengers.
CAA could get “more teeth”
A House of Commons transport committee released a report this week recommending that the UK’s aviation regulator be given “more teeth”. The report suggested that the CAA be given powers to impose fines on airlines that fail to refund passengers when required to by law. Flight cancellations are a pressing issue at the moment, with UK airlines facing heavy disruptions as passenger numbers return to pre-COVID levels. British Airways has cancelled over 1,400 flights this month alone, and CEO Sean Doyle warns that disruptions could last until September.
Paul Smith, Consumer Director at the CAA, welcomes the suggestion of greater powers, stating:
“We have regularly asked for stronger consumer enforcement powers, including the ability to impose fines on airlines. This would allow us to take faster action when appropriate and bring our powers in line with other sectoral regulators.”
Other UK regulators, such as the Office of Rail and Road, can issue financial penalties to non-compliant businesses. However, the CAA derives its powers from the Enterprise Act 2002, which states it can only “request information from businesses, seek undertakings from the business and enforcement orders from the courts to stop an infringement”. For the CAA, then, the process of sanctioning companies is a lengthy, expensive and resource-intense one.
For example, the regulator has been fighting Ryanair in the courts for three years over its failure to refund passengers for cancelled flights in 2018. Ryanair took legal action against the CAA’s enforcement proceedings, claiming that the pilot strikes that caused the cancellations amounted to “extraordinary circumstances”, exempting them from issuing refunds. The court disagreed, ordering Ryanair to pay out, but the airline may still appeal the ruling.
Consumer watchdog Which? concluded that the aviation regulator’s effect on airline behaviour was “largely ineffectual”, as the CAA often opted not to pursue enforcement for airlines not paying out refunds in time, instead accepting commitments from the airlines to improve their performance.
Other things covered by the report
The report, titled “UK Aviation: Reform for Take-Off“, also covered topics such as ghost flights, sustainable aviation, and the recovery of the airline industry post-Covid. In it, MPs called for ministers to publish an aviation recovery plan by June. The chairman of the transport committee, Huw Merriman, said:
“Now that government has removed all coronavirus-related restrictions on international travel, ministers must get on with protecting the sector against future economic shocks,”
Airlines are in a delicate position as they try to recover from two difficult pandemic years. Tim Alderslade, CEO of airlines UK described the pandemic as the industry’s “worst-ever crisis” and noted that it would take several years before airlines are able to recover their debts.
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