A government support package with loan guarantees is underway for the travel industry.
It is expected to cover the mountain of refund claims that have arisen after all canceled trips during the Covid-19 pandemic, according to the Swedish Travel Agency and Travel Agency Association (SRF).
Tens of thousands of consumers are estimated to have refund claims for canceled trips during the pandemic. These are claims totaling SEK 600–700 million, according to SRF Secretary General Didrik von Seth.
Some of the requirements date back to March this year, when the Ministry of Foreign Affairs issued its first general advice against foreign travel as a result of the pandemic, others from all canceled trips this summer.
But the mountain of accounts receivable piling up at tour operators – which concerns package holidays where airlines and hotels have not paid anything back – also includes, among other things, the new wave of refund demands that are expected to come when Christmas and New Year's trips are cancelled. This is because the Swedish Foreign Ministry's general travel advice currently applies until January 31, 2021.
SRF has been given access to selected parts of a proposal for a support package that the Ministry of Finance is preparing for an amending budget. The proposal itself is expected to be presented in a week or so, but according to von Seth, it is unclear when an amending budget can be hammered out in parliament.
”"The proposal applies to all trips that would have taken place from March 1, 2020 to January 11, 2021," he tells TT.
According to SRF, the support package will consist of long-term loans with government guarantees to tour operators.
”You will be able to borrow up to eight million as a sole proprietorship or 25 percent of your annual turnover,” says von Seth.
According to information provided to SRF, the ceiling should be in line with what is permitted under EU regulations regarding state aid.
The level of support looks reasonable according to von Seth. He sees a certain risk that individual small players with large repayment requirements will not be able to pay for themselves even with the support.
”But we believe that this should reasonably cover the vast majority of requirements,” he says.
SRF already proposed special support for the travel industry in March to help manage the costs that arise as a result of all canceled trips. And the issue was raised earlier this week at a press conference with Finance Minister Magdalena Andersson (S).
”"We are working to be able to present something as soon as possible," she told TT.
At the press conference, the Minister of Finance described the situation regarding refund claims as serious and said that the government wants to find a way to support tour operators.
”"Here we are working with several different solutions and are now looking at the legal conditions and hope to be able to return to that issue as soon as possible. We see the problems," she said.
A company that has sold a package holiday that is cancelled has, according to current regulations, two weeks to refund the money to the consumer. For airlines that have sold flight tickets, the period is seven days.
The Swedish Consumer Agency has recently threatened the airline SAS with a fine of 1 million kronor per month if they delay their refunds for more than seven days.
”"It is not acceptable that consumers should be forced to act as lenders and lend their money to companies. Many affected people are waiting for thousands of kronor, money that they have paid for a service that has not been delivered," wrote Consumer Ombudsman Cecilia Tisell in a statement last week.
Source: TT
