Advice on cover for transport

6th February 1998 at 00:00
Going by coach? Beware, says David Craven, boss of the NST Travel Group. The system of financial protection for coach operators is "totally open to abuse". Mr Craven is a long-standing critic of the system. The European Community package travel directive in 1992 brought in legislation to ensure better protection for holidaymakers but left the door open to risky business practices.

The Government said companies must guarantee to cover clients' trips if they go bust. They could either bond through an official regulator such as the Association of British Travel Agents, use a trust account at a bank to ensure money was spent for its specific purposes or take out insolvency insurance.

Mr Craven believes the Government has failed to police the system adequately. Consumer affairs minister Nigel Griffiths is looking at it, but improvements may be difficult. It is left to local trading standards officers to check whether companies comply. "Do not trust the trust accounts. It's 'give me your money and trust me'," Mr Craven warns.

He advises party leaders to ensure coach trips are bonded either through ABTA or the Confederation of Passenger Transport and its bonded coach holidays(BCH) scheme.

Allan Edmondson, a confederation adviser, admits it can be difficult to check whether a company is bonded but says there are fewer difficulties with recognised agencies.

"We check companies' financial stability and assess their risk. In the schools' market we require a larger bond because of the slightly increased risk. Schools pay more in advance," he says. "But even if companies go down the pan, the clients do not lose out. We're happy to take the risk."

ABTA advises teachers to check the bonding of operators and, like the BCH scheme, anyone can phone up to check. The association audits accounts of companies four times a year and takes in fees based on percentage of turnover and the number of clients carried.

All operators using air travel must be bonded with the Civil Aviation Authority and display an ATOL(Air Travel Organisers' Licence). Again, the CAA offers complete protection to party leaders going skiing by air.

Recognised bonders:

Association of British Travel Agents, tel: 0171 307 1904

Association of Independent Tour Operators, tel: 0181 744 9280

Association of Bonded Travel Organisers Trust, tel: 0171 930 7714

Civil Aviation Authority, tel: 0171 832 5620 or 0171 832 6600

Confederation of Passenger Transport, tel: 0171 240 3131

FTO Trust Fund(large operators), tel: 01273 477722

Passenger Shipping Association, tel: 0171 436 2499

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