TAXPAYERS will fork out at least £156 million due to the collapse of Thomas Cook, a report by the Whitehall spending watchdog has found.
The National Audit Office (NAO) said the Department for Transport (DfT) has agreed to pay an estimated £83m towards the total cost of repatriating customers who were not covered by the Atol scheme.
Other Government costs include £58m in redundancy and related payments to Thomas Cook’s former employees, and at least £15m for liquidating the business.
The NAO added that “the final cost may not be known for some time”, partly due to invoices for repatriation costs still being received.
Labour MP Meg Hillier, who chairs the Commons’ Public Accounts Committee (PAC), said “lessons need to be learnt and future risks understood”.
She went on: “The repatriation looks set to cost the taxpayer £83m and there are other costs associated with insolvency of at least £73m.
READ MORE: Flybe collapse: Up to 1000 workers could lose jobs following closure
“Government looks set to foot the bill, with industry off the hook. The resources to cover other airlines going bust is now very limited. New regulations are urgently required.”
When Thomas Cook collapsed on September 23 last year, the DfT instructed the Civil Aviation Authority (CAA) to repatriate all 150,000 holidaymakers who were overseas.
This included the roughly 83,000 who had not booked a trip with Atol protection, which meant they were not automatically entitled to be flown home free of charge.
The DfT is reimbursing the cost of repatriating those passengers.
A spokeswoman for the department said: “Due to the unprecedented scale of the operation, other airlines did not have enough capacity to repatriate those abroad.
“Without this effort, stranded passengers couldn’t be guaranteed a safe journey home, causing stress and disruption to families, which would have had a knock-on effect on the wider economy with so many employees abroad.”
A total of 746 flights from 54 airports were involved in what was known as Operation Matterhorn.
The NAO report warned there could be further costs to taxpayers if another large travel company collapses in the near future.
That is because the Government has agreed to stand behind the fund that covers Atol-protected passengers if it runs out of money.
Why are you making commenting on The National only available to subscribers?
We know there are thousands of National readers who want to debate, argue and go back and forth in the comments section of our stories. We’ve got the most informed readers in Scotland, asking each other the big questions about the future of our country.
Unfortunately, though, these important debates are being spoiled by a vocal minority of trolls who aren’t really interested in the issues, try to derail the conversations, register under fake names, and post vile abuse.
So that’s why we’ve decided to make the ability to comment only available to our paying subscribers. That way, all the trolls who post abuse on our website will have to pay if they want to join the debate – and risk a permanent ban from the account that they subscribe with.
The conversation will go back to what it should be about – people who care passionately about the issues, but disagree constructively on what we should do about them. Let’s get that debate started!
Callum Baird, Editor of The National
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules hereLast Updated:
Report this comment Cancel