The cost is detailed in the report of the Air Travel Trust (ATT) for the year ended 31 March 2020, which puts the compensation total at £444,425,687.
Cook failed on 23 September 2019, prompting the largest-ever peacetime repatriation of more than 150,000 people. Only 45% - 68,000 – had Atol protection, with the UK government picking up the cost of the remaining flights. The ATT refunded “almost 12 times as many customers”.
Speculation about Cook’s predicament led the ATT to increase its insurance excess against a collapse. The report said: “This effectively capped the ATT’s exposure to £250 million, which was within the cash reserves of the Trust at the time of failure.”
In all, claims for eight tour operator failures in the year amounted to £448,459,994, with the next biggest being The Holiday Place, at £3.6 million. Other small failures cost £458,301. The enormous sums involved compare with total claims in 2019 of just £3.6 million.
The failures mean the ATTF took a £201 million hit before the pandemic. However, the report says £45 million of cash reserves and borrowing facilities of £75 million mean the fund is still viable. It added: “the Trustees’ expectation is that HMG will provide additional financial support to the ATT as necessary” and concluded: “the ATT has adequate resources available to continue in operational existence for the foreseeable future, being not less than 12 months.”
The ATT is topped up by Atol Protection Contributions. The APC is levied at £2.50 per passenger and contributions in the year remained in line with 2019, at just under £65 million. This was raised from just under 26 million passengers. However, the pandemic has since meant APC contributions have dipped to “approximately one-third of levels in the previous two years”.
The report highlights how payments were made following the Cook collapse to those who had booked through agents or who had used Cook’s payment scheme.
The report said: “Following on from the process first adopted with Monarch, consumers that had booked through retail travel agents were refunded without having to first wait for their agent to forward any ‘pipeline’ monies they were holding, with the reconciliation taking place behind the scenes.”
In addition, Cook was the first Atol failure involving direct debit instalment payments and more than £90 million was refunded automatically to 91,000 customers via GoCardless.
