Thomas Cook — House of Lords, 2019-11-05
Topic: Domestic Commerce
Ian Duncan (Conservative, Centre-right): I will begin at the beginning, if I may. The viability or long-term prospects of Thomas Cook are on many people’s minds. Of course, the question is: could the Government have intervened in such a fashion that could have saved Thomas Cook? I fear the answer is no. The more investigations are undertaken by the official receiver, the more we begin to recognise the scale of the debt Thomas Cook was sitting atop—£1.9 billion, which is an extraordinary amount of money I appreciate that when an institution of such age falls, there are always questions about whether more could have been done. I suspect that more could and should have been done by the directors themselves. I hope that the official receiver’s investigation will reveal exactly where the fault-lines lay when it sets out how this went forward. I do not have an answer for the noble Baroness, Lady Randerson, about when we will be able to expect that; I am afraid that it will rest in the hands of the official receiver, but I would like to think that it will not be long delayed. We deserve an answer to that. A significant amount of public money has already gone into the various elements of this process, with more yet to come. I would like to get to the bottom of that question because we need to understand exactly what has gone on I welcome the support of both noble colleagues this afternoon for the issues we have had to take forward on the wider repatriation and so forth. If I might draw it down to the compensation scheme, clearly that will have to be done after the election. I welcome the commitment from the other side that we would stand united in moving forward with this, irrespective of the outcome of the election. It is important for the victims to hear that loud and clear. At present, we anticipate that that money will be met primarily and solely through a government fund. It will not come through ATOL, which has a number of restrictions placed on it that will not allow it to compensate in this regard. The wider question as to how we are in a position to do so and identify will be important. We will make sure that very clear instructions will be on BEIS’s website, but also on that of the official receiver and so on, for those who are, in essence, the unsecured creditors, because they are in many respects often at the very back of the queue during a liquidation. In this case—the official receiver has already identified this to us—we want them to be aware of the situation, with very clear guidance on what they have to do next to be prepared I should draw your Lordships’ attention to one simple fact: there will, of course, be an interregnum between the point at which I make this Statement and when we can create such a scheme post the election. There will need to be clear guidance to help direct people towards other sources of government support during this difficult intervening period. The guidance should reveal exactly what that is. Once we pass through the storm of the election and return, the question will be how to design the programme so that it can be quickly instituted and implemented. It will need primary legislation, so we will have another opportunity to come back to and explore this. It will necessarily be a capped scheme. The noble Baroness is of course right that some people will not receive compensation. To some degree that is inevitable depending on the severity of the situation we face. We wish to ensure that those whose experiences are the most severe are fully compensated through this approach. Those who are experiencing other elements of that compensation will not be able to secure it; it will be judged on severity. We will have a chance to look at the criteria when we return. It begs a bigger question which we need to look at: who else is doing this and how safe are they? In the next Parliament, we will need to look very carefully at this whole story to see whether lessons can be learned. The ability to self-insure but not then ring-fence the funds from which that insurance can be drawn is wrong and is creating the very problems that we are seeing here. We will need to revisit this; that will be right and proper. I do not wish to prejudge exactly how we will do it, but it will be through primary legislation. We will need to act very carefully to avoid a situation, in the ever-volatile travel sector or elsewhere, where individuals who are due significant compensation for serious injury or loss of life are placed in a predicament where they are wondering whether that money will continue to come towards them. That would be wrong. I hope that we can do something about that. The official receiver will look into how on earth Thomas Cook, a company of such standing, could reach the predicament that it found itself in. That will involve looking at the question of bonuses and each of the other elements within the wider director’s role. We will need to be cognisant of what that will be. Once we receive that report, we will need to be alert to what it might mean for a wider question going forward, regarding legislation that may be required elsewhere On the question of support for the CAA staff, there is indeed no doubt that they have gone above and beyond. I will commit now to look what they need and how to be helpful. I will talk to my colleagues and the Minister at the Department for Transport to understand better how we may be able to afford that. The question of the nature of the forms will, I fear, be a perennial one. There are, necessarily, bureaucratic elements, much as I would wish to say otherwise. The guidance that we issue must be as clear as we can make it, and we must ensure that those who are experiencing any difficulty in completing those forms can secure the assistance that they require. I will take that away and give it some thought, to ensure that no one is, through the bureaucratic challenge, unable to access necessary funds in this situation I think I have covered all the issues; if I have not, I hope that noble Lords will alert me, and I will be very happy to write to them directly.