Consultation on Atol reform closed on 15 August, with concern smaller agents and operators will be hit by plans to limit the use of customers’ money as working capital.

Speakers during a Barclays travel webinar expressed worries that ring-fencing consumer monies would stifle the trade.

Irene Hays, Hays Travel co-founder, said there were no industries that did not use consumer monies as cashflow.

“My argument is strict regulation would kill start-ups,” she said. “Our view is the regulations should be proportionate to the risk. I don’t think there is a one-size-fits-all proposition.”

The CAA is keen on trust accounts as financial protection for agents following the collapse of Thomas Cook, which had withheld pipeline monies.

However, Adam Murray, EMEA chief finance officer, Flight Centre Travel Group, said “not all trust accounts are equal” and said reform to include airlines was needed.

“To date, I don’t think there is an appetite to look at that. Airlines specifically always seem to be out of scope. The regulations don’t apply to them. Travel intermediaries end up bearing the brunt.”

Gary Lewis, Travel Network Group chief executive, said the issue was “Atol companies that own an airline”.

He said the Air Travel Trust (ATF) had enough funds to cope with smaller company failures. “It never had the funds to cope with Thomas Cook’s failure.” 

TTNG includes the Travel Trust Association. “Trust accounts are as good as the structures around them,” said Lewis.

“What we have proven with the TTA is we believe we have the best structure to do that. That’s why we have an Atol licence franchise agreement; that mitigates the ATF and the risks on it.”