MISSISSAUGA — After more than a year of aggressively lobbying the Ontario government for Compensation Fund reform, ACTA is rallying the industry to get involved and join its efforts.
ACTA says it wants relief for Ontario travel agencies from the many financial and administrative burdens of the Travel Industry Act and the Travel Industry Compensation Fund.
ACTA and CATO formed an industry coalition in fall 2018 and hired a lobbyist to guide their efforts and deliver their concerns to the government.
ACTA President Wendy Paradis says a team of ACTA and CATO senior leaders have been actively meeting with Ontario Government officials since early 2019.
“The message to every government official has been clear – the status quo in Ontario is not effective or sustainable and places an unfair burden on Ontario travel companies, as well as offering very little meaningful protection to Ontario consumers,” says Paradis. “We need to adopt a funding model similar to Quebec for funding consumer protection.”
Paradis says lobbying efforts will continue now that the Ontario government is back in session and ACTA wants all Ontario registrants to get involved.
As part of its ongoing campaign, ACTA is asking industry members to support a letter writing campaign to their MPPs and the government.
For letter templates see the home page at acta.ca or click here.
“All Travel Agency Owners should be paying attention and we need their help at the grass roots level,” says Paradis. “In our meetings over the past several months, it became clear that many MPPs have never heard of TICO or the Ontario Travel Compensation Fund. We need to get relief for travel agencies from this archaic and inadequate piece of legislation. Reform is essential or travel agencies will just continue paying more and more.”
ACTA is telling the government that the Compensation Fund model is outdated and significantly broken, she adds, noting that the Fund was designed in the 1970s when consumers paid by cash or cheque, pre-Internet and e-commerce.
These days more than 90% of travel agency transactions are completed using a credit card, “making travel agency bookings a much lower risk”.
Paradis says it is an unfair financial and administrative burden on Ontario travel businesses, creating a disadvantage for Ontario travel companies and making them uncompetitive in a global market.
The Fund currently sits at more than $23 million but an actuarial study conducted for TICO recommended that the Fund should be at $50 million.
If a consumer pay model is not adopted, over time Ontario travel companies will have to contribute a lot more than they do already, says Paradis.
ACTA’s stance is that the Compensation Fund does not work for consumers, arguing that it is confusing, has many limitations and delays before paying and is the payer of last resort.
TICO has a policy of forcing the consumer to first request a charge-back if payment was made by credit card – or requesting reimbursement from a travel insurance policy. If the failure is a large one, there is a cap on total payout per failure, so consumers only get a partial payment, says Paradis.
The recommendation is for Ontario to move to a consumer-pay model similar to the one in Quebec – and in most other countries around the world – if the Compensation Fund is to be sustainable and adequate to provide meaningful protection to consumers in the event of travel company failures.
ACTA is also seeking to reduce the burden of excessive financial reporting, noting that many Ontario travel businesses are required to submit a costly audited financial statement on an annual basis to TICO.
Paradis says ACTA has strongly recommended to the Ontario Government that the requirement of paying for and submitting audited financial statements is an expensive and unnecessary burden on many Ontario travel agencies.
After a recent and extensive review of Canada’s financial criteria by IATA, Review Engagements were deemed the highest level of reporting necessary for Canadian travel agencies. ACTA is strongly urging the Ontario Government follow suit.
ACTA also supports the recommendation proposed by TICO that other less expensive forms of internally prepared financial statements be considered for small travel businesses with Ontario gross sales of under $2 million.
Paradis says that anyone who would like more information or wants to get involved can contact her at email@example.com or phone: 905-282-9294, ext. 121, or reach out to Heather Craig-Peddie, ACTA Vice President of Advocacy and Industry Relations, at firstname.lastname@example.org or 905-282-9294, ext. 122.