Government response rejects petition asking for no APD during school summer holidays
A petition to the Treasury has been created, asking that the government suspend or reduce Air Passenger Duty (APD)during the school summer holidays. The petition says British families need quality time together at a time they legally can (parents are not meant to take children out of school in term time). Quite why the families have to get on a plane in order to have quality time together is not explained. As the number signing is now around 38,000 there has been a response from the government. They say “APD exists to provide revenues for the public services. Revenue from APD plays an important part in supporting this Government’s stabilisation of the UK’s public finances.” They add that APD is charged by the airlines, and they have the option of not passing the cost on to the passengers. They also say that APD for the majority of flights, which are to Europe, is only £13 for a return trip. “The duty makes up a relatively small proportion of the total ticket cost. For example, it is less than 9% of the cost of an early booking for return flights for a family of four to Málaga in July 2014. Other charges imposed by airlines, such as fuel or luggage surcharges, can make up a much higher proportion of the total ticket price.” The industry ramps up the price of flights and holidays during July and August, by far more than the price of APD. For instance, holiday price £2,015.59 in August and £1,214 for the same trip in late September.
End the ‘Parent Trap’ – suspend or reduce APD over school summer holidays
Responsible department: Her Majesty’s Treasury
I am calling on the government to help British families manage the “Parent Trap” of inflated holiday prices in summer by suspending or reducing the rate of Air Passenger Duty (APD) for the annual school summer-holiday period of July and August. This will allow British families to enjoy much needed quality time together at the only time children are legally allowed to take holidays. This proposed tax break will ultimately benefit parents and teachers, who are corralled into taking holiday during the school summer break, when prices are already escalated.
This e-petition has received the following response:
As this e-petition has received more than 10 000 signatures, the relevant Government department have provided the following response:
Air Passenger Duty exists to provide revenues for the public services. Revenue from Air Passenger Duty plays an important part in supporting this Government’s stabilisation of the UK’s public finances as the country’s economy recovers from the biggest financial crisis in generations, one of the deepest recessions of any major economy and a decade of growth built on unsustainable levels of debt.
Whilst meeting this objective the Government has still been able to deliver a real terms freeze to Air Passenger Duty for three years. During this time, rates for the vast majority of passengers have only increased by £1, and it is £13 on an economy flight to Europe. The duty makes up a relatively small proportion of the total ticket cost. For example, it is less than 9 per cent of the cost of an early booking for return flights for a family of four to Málaga in July 2014. Other charges imposed by airlines, such as fuel or luggage surcharges, can make up a much higher proportion of the total ticket price.
The liability to pay Air Passenger Duty sits with airlines rather than with passengers. This means that while airlines do tend to pass the cost of APD on wholesale to passengers, there could never be any guarantee of savings being passed on fully even if it were feasible to temporarily reduce it during the summer holiday period.
The Government’s approach to Air Passenger Duty is to ensure that the aviation sector makes a fair contribution to bringing down the deficit. The sector pays no tax on the fuel used in international and nearly all domestic flights. There is no VAT on international flights, and, unlike many countries, the UK does not charge VAT on domestic flights.
Alongside three years of real terms freeze to Air Passenger Duty the Government has also made funding available to help local authorities in England freeze their Council Tax for a third year in a row. Since 2011, the Government has announced successive increases in the personal allowance, so that from April 2014 the cumulative effect will have taken 2.7 million people out of income tax, and a typical basic rate taxpayer will see a cash gain of £705 per year. And the longest fuel duty freeze for over 20 years means that it costs £7 less every time a typical family fills their tank, and £10 less by the end of the Parliament.
The Government, of course, keeps all taxes and duties under review.
This e-petition remains open to signatures and will be considered for debate by the Backbench Business Committee should it pass the 100 000 signature threshold.
Debate: should school holiday price hikes be banned?
Jan 30th, 2014
Feature by Moneywise editorial
The remarks of one furious father who found that Center Parcs charged £300 more for a villa stay during half term than in the previous week have gone viral.
Paul Cookson, from south Devon, vented his experience on Facebook, writing: “I am sick to death of being ripped off in this country”.
He encouraged fellow fed up parents to sign an online petition to get the issue debated by Parliament. The petition has had almost 150,000 signatures to date, meaning the issue will be discussed by MPs.
So should travel companies be prevented from hiking prices in the school holidays? Moneywise has put two experts on the subject – a parent and travel association ABTA – head to head to debate the issue.
“YES” SAYS RACHEL LACEY, MUM OF TWO AND MONEYWISE SPECIAL PROJECTS EDITOR
As I gaze out of my window and see that it’s yet again grey and wet – I can think of nothing better than soaking up some sun. Dreams of lazing on the beach, playing with the kids in the pool and showing them another part of the world is the perfect antidote to another cold, wet day.
But my eldest son has just started reception, so a dream is all it is. Now that we can go only go away during the school holidays we’re getting used to the idea of gambling with the weather and only having holidays here in the UK.
Sun aside, I’d love to take my boys abroad to give them exposure to other languages and other cultures, but it’s just too expensive. Even a week on a Spanish package holiday would set us back a few grand.
We investigated DIY Easter breaks around Nerja – the prices of villas were reasonably affordable, especially as we’d be splitting the cost with another family – but it was the flights that were the killer. More than £1,200 for four of us.”
That said, staying in the UK is by no means a cheap option. We’ve just booked a week in a Norfolk holiday cottage in August and it’s costing us £1,500. But at least there’s no air fares or ferry crossings to cough up for; just a tank of petrol, which thankfully doesn’t get more expensive the minute the schools break up.
Had we been able to take our breaks just a few weeks earlier, or later, all these holidays would have comfortably been in our price range – but the travel companies, airlines, ferry companies and hotels all know that with so many families needing to take their holiday during a limited number of weeks they can get away with ramping up their prices.
It’s not as if it’s only a problem during the summer. As our childminder is away during the February half term, we thought we might look into a short break at Center Parcs. We’ve done it a few times out of season and never paid much more than £300 for a four-night stay, but at half term that price is £900.
Of course, I get the laws of supply and demand, and accept that I will need to pay more at popular times of year but tripling the price either makes me think that Center Parcs is shamelessly profiteering or I’m just subsidising the bargain breaks offered to people to keep their resorts full during the quieter weeks of the year. Either way it’s not fair.
I don’t think taking kids out of school to go on holiday is the solution, I’d much rather see rules that prevent holiday companies imposing excessive price rises during school breaks and charging holidaymakers fair prices throughout the year. Why, after all, should I pay over the odds just so child-free holidaymakers can cash in with a cheap week away whenever they like?
“NO” SAYS A SPOKESPERSON FOR TRAVEL ASSOCIATION ABTA
Any attempt to make travel companies, who already operate in a very competitive market, artificially lower their prices during the school holidays would be highly unusual, controversial and impractical.
Although we can sympathise with the sentiment behind some parents’ comments in the media, the e-petition sparked by Mr Cookson’s Facebook comments could only raise false hopes that the government can or would want to apply a cap to freely-determined market prices.
The reason prices rise during school holidays and other busy periods is down to supply and demand – this is how all prices are set and it’s unrealistic to think that the travel industry, or any other competitive industry, could price their products any other way.
More people in the UK and across Europe want to take holidays in July and August, at Easter and at Christmas. During these periods there is increased demand for a finite number of hotel rooms and flight seats from families and other travellers across the continent. This demand for a finite supply sets the price.
ABTA believes that a sensible way of relieving the pressure of high demand during the short window of the current school holidays is for schools to consider staggering their holiday dates, thereby spreading the demand from families over a longer period.
Tour operators are being criticised, but it should be pointed out that they already offer some of the most family-friendly travel deals in the industry. Many offer cheaper prices and free child places for early bookers, and there may be excellent last-minute deals for those that can be flexible on destination, helping many families to take affordable holidays in the school breaks.