The New Zealand Government has announced a program to support travel agents in securing credits and refunds for clients from overseas travel suppliers.
Under the program, travel agencies will be paid 7.5% of the value of any cash refunds they secure on behalf of their customers, or 5% of the value of travel credits.
"We know the travel sector and their customers have taken a massive hit due to the disruption caused by Covid-19," Faafoi said, with an estimated NZ$690 million of client funds currently locked up because of cancelled travel.
"We want to get that money back for Kiwi customers and into the local economy as quickly as possible," he said.
"I know that travel agents and wholesalers have been working hard to recover funds and credits owed to New Zealand consumers, but are under severe financial pressure, with many facing the prospect of insolvency.
“The travel reimbursement scheme will help increase the likelihood of consumers recovering refunds and credits owed to them. It will also give greater confidence to the travel industry by limiting further insolvencies.”
Faafoi said the scheme would be established as soon as practicable, with details such as eligibility to be "worked through over the coming weeks".
Four major travel agencies – Flight Centre, House of Travel, First Travel Group and Helloworld – had lobbied the Minister for funding, and they said in a written statement that they were grateful their pleas had been heard.
In Australia, the Australian Federation of Travel Agents (AFTA) has lodged a formal submission seeking $125 million in Government support for the industry, with concerted lobbying now under way in the lead-up to next month's Federal Budget.
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