By Daniel Hunter

Up to six million extra holidays each year will be fully protected against the failure of a travel company after Aviation Minister Theresa Villiers confirmed measures to strengthen and modernise the ATOL holiday protection scheme.

Running since the 1970s, the Air Travel Organisers' Licensing scheme offers customers whose holiday company becomes insolvent a full refund or repatriation at the end of their trip if they are already abroad.

Following a consultation last year, the changes confirmed today will come into effect on 30th April and will mean:

- "Flight-Plus" holidays sold by tour operators and travel agents are included in the ATOL scheme. These are holidays that look like package holidays but are sold in a way which currently falls outside the scheme.

- passengers are given a standard, recognised certificate at the point of purchase, so they know whether their trip is protected by the ATOL scheme or not.

"The ATOL scheme has been providing peace of mind for holidaymakers for decades, but the way we book holidays has changed and the scheme needs to move with the times. All too often customers are unsure as to whether they are protected or not," aviation Minister Theresa Villiers said.

"The changes I am making today will provide much needed clarity and reassurance for millions of people booking their holidays. These reforms will equip ATOL to deal with the realities of the modern holiday market, enabling the scheme to protect holiday makers for many more years to come. This is an important step forward for consumer protection”

The changes confirmed today will also help return the scheme to a more secure financial footing. Following a series of high-profile insolvencies in recent years, the fund which covers the costs of repatriation or refunds is currently running at a deficit, supported by a Government-backed guarantee. It is hoped the new rules will eliminate this within three years, reducing the risk to the taxpayer.

Last month the Government also introduced the Civil Aviation Bill into Parliament, including a clause which could enable the Secretary of State to make further changes to the ATOL scheme in future. These include the option to include holidays sold by airlines, which are currently exempt from the scheme, as well as the power to bring holidays arranged on an 'agent for the consumer' basis to be brought into the scheme. Subject to Parliamentary process, the Government would carry out a full consultation and impact assessment on any regulations that would give effect to these powers.

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