Examination of Witnesses (Questions 80
- 89)
WEDNESDAY 2 NOVEMBER 2005
MS KAREN
BUCK MP, MS
SANDRA WEBBER,
SIR ROY
MCNULTY
AND MR
RICHARD JACKSON
Q80 Chairman: Well, you see, what
is interesting about it is that the lawyers have said that of
course they cannot act on rumours and that is a perfectly normal
response, but, Sir Roy, is it true that EUjet's parent company
changed its name twice and was briefly suspended from the British
Stock Market?
Sir Roy McNulty: I do not have
that information to hand. I can check for you.
Q81 Chairman: We would like a note
from you, I think. Therefore, we are to take it, Minister, that
the decision was actually an ideological one, that you did not
feel it was necessary to get this protection and it was something
where you felt people had the responsibility to insure themselves,
so the fact that there are some people down the bottom of the
pile who may regard insurance as a bit of a—
Ms Buck: I would not accept the
use of the word "ideological", but I would say that
it was a choice of approach. In fairness, it is something that
is comparable with every other area of public life. We do not
require people to take out medical insurance, we do not require
people to have E111s, we do not require them to have home contents
insurance and we do not require them to do anything for their
car other than third-party insurance, so why is it that in a completely
transformed travelling environment we would necessarily expect
a way of underpinning arrangements for people that we do not expect
in any other area?
Q82 Mr Martlew: On the recent collapse,
did the British Government have to assist anybody to return home?
Ms Webber: In the EUjet case?
Q83 Mr Martlew: Yes.
Ms Webber: No.
Mr Martlew: So everybody had to scrape
the money together or whatever and the Government did not have
to assist in this case?
Chairman: No, that was the evidence,
but in fact every family paid a minimum of £100.
Q84 Mr Scott: If two-thirds of the
passengers did not have a clue that they were not covered, I think
the difference from all the points you have just made is that
none of those issues leaves you abroad trying to get back to your
country. It is a totally different issue from insuring your car.
You might break down, but you would break down somewhere in the
United Kingdom on the whole.
Ms Buck: You can break down abroad
actually.
Q85 Mr Scott: In most cases I am
sure that is true, but not for some 60% of the passengers being
stuck abroad.
Ms Buck: I suppose there are two
points to this. Firstly, there is the question of how much does
it cost and I would suggest when you look at the EUjet experience
or these low-cost airlines, I regret that anybody is in that position,
but the amount of money involved is smaller than pranging your
car, so that is the money point. The second point is: are you
stranded? Increasingly, I think it is the view, and the view we
took, that the capacity in these cases is such that people are
not likely to be stranded unable to get—
Q86 Chairman: But they will not be
able to guarantee that anybody is going to give them a seat. This
is only a voluntary arrangement and already there is an argument
about how voluntary it is going to be.
Ms Buck: I think the European
Low Fares Airline Association are saying that they will make that
provision, so I think that covers, and I think the figure is between,
30 to 35% of the market.
Q87 Mr Scott: So, Minister, you are
saying that if the capacity on their current flights was full,
they would put on extra flights to get these passengers home at
lower amounts of money?
Ms Buck: Sorry?
Q88 Chairman: If they are low-fare
airlines and they are already fully booked, you are saying that
they would undertake to get people back by putting on other flights
free?
Ms Buck: I am saying that the
deal is as has been set out, but one of the concerns was reflected
in your report last year, that there would not be capacity and
I do not think, in the light of our understanding, that that is
likely to be a problem. It was not a problem in the EUjet experience
and we believe that the capacity would be there.
Mrs Ellman: Can we go back to the voluntary
agreement you have circulated from the European Low Fares Airline
Association. It does say specifically that the repatriation offers
would be there, subject to availability on the route in question.
Does that take us any further at all?
Q89 Chairman: We are not very bright
here. We have understood a system where you say that low-fares
airlines who have got capacity will fly people back, fine, but
what we are asking you is, supposing these low-fare airlines are
already fully booked, is it your understanding that they would
put on another flight to get everybody home free?
Ms Buck: I am saying that there
is no guarantee that that is the case, but the EUjet experience,
which happened at the peak of the season, showed that passengers
booked could be returned and there was capacity.
Chairman: Well, you have been very revealing.
Thank you very much, Minister.
| 
