Holidaymakers face six-month wait for refund

MILLIONS of travellers owed refunds for cancelled flights face months of chaos amid a crisis in the airline industry.

Carriers and tour operators owe an estimated £7billion to holidaymakers whose trips have been ruined by the pandemic.

Under EU laws, customers should get their money back within seven days.

However, the number of cancelled trips means customers are waiting much longer as airlines struggle to deal with a colossal backlog of claims.

The sheer scale of the crisis was underlined yesterday as Ryanair boss Michael O’Leary warned it will take up to six months for the airline to process 25million refunds. Industry leaders fear many crisis-hit airlines will be bankrupted.

To weather the storm, they have been urging passengers to accept vouchers towards a future flight. However, the Competition and Markets Authority is concerned that many have been pressured into accepting them.

Last night easyJet founder Sir Stelios Haji-Ioannou warned that customers who accept vouchers could end up losing their money.

Documents seen by the Daily Mail suggest EasyJet has saved at least £700million, partly by encouraging passengers to choose vouchers.

But Sir Stelios warned that the vouchers, which have little consumer protection, could be ‘worthless’ by the end of the year due to the uncertainty facing the industry.

The tycoon, whose family is easyJet’s largest shareholder, is calling on the company to cancel a £4.5billion contract for 107 new Airbus planes.

He said: ‘If you are a voucher holder hoping to use the voucher to fly on easyJet in 2021, you must call on easyJet to cancel the Airbus order.’

EasyJet said customers ‘can be absolutely confident to accept vouchers’.

It follows complaints from consumer groups and MPs, who have accused airlines of using underhand tactics to avoid paying out.

Yesterday the Civil Aviation Authority warned airlines not to ‘systematically deny’ refund rights and to pay out ‘as soon as practically possible’.

Ryanair boss Mr O’Leary warned it will take ‘many months’ to process 25million refunds for cancelled flights.

He told Radio 4’s Today programme: ‘We’re working through the March refunds, that will certainly take us two or three months, then we move to the April refunds, then the May refunds.

‘The May cancellations will take us four to six months at the moment to process.’ Customers with British Airways – which will no longer serve alcohol on flights to reduce interaction between passengers and crew – say they have been getting refunds relatively quickly.

However, they are being asked to call a customer service line which often plays an automated message before hanging up.

EasyJet is promising refunds within 28 days, but admits this could take longer.

Virgin Atlantic is automatically offering vouchers, but customers have to contact the airline if they want a refund paid within 90 days.

It came as reports emerged that the Government has turned to Morgan Stanley for advice on how to keep airlines in business.

The Wall Street bank was initially drafted in to handle a possible bailout of Virgin Atlantic, but has been awarded a broader mandate covering the entire sector.

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‘Encouraged to choose vouchers’