The UK's Transport Secretary, Grant Schapps, recently claimed that air travelers should be entitled to automatic compensation like the national scheme in place on the country's rail system. We take a closer look at this idea below.

Automated airline refunds

The issue of airline reimbursement has become a hot topic in the UK in recent weeks, given the chaos and cancelations blighting the country's airports. With airlines canceling flights left, right and center, thousands of passengers have seen their holiday plans thrown into turmoil.

Grant Schapps, the UK's Secretary of State for Transport, believes the current system for claiming compensation from airlines is too complicated and would benefit from an overhaul.

Schapps said on BBC One's Sunday Morning program,

"I want to make sure there is automatic compensation for passengers. It can’t be acceptable that it is so complicated sometimes to get a flight rearranged or to get your money back. I want it to be more like Delay Repay works on trains. The train network allows passengers to demand refunds for delayed services simply by producing their tickets."

The 'Delay Repay' scheme in place across the UK's national rail network entitles passengers to compensation of 50% of the ticket price for delays between 30 minutes to 60 minutes and a full refund for delays of over an hour. If trains are canceled, passengers will receive a full refund.

In the aviation industry, claiming compensation is done through the airline rather than a standardized platform like Delay Repay. The claims process can be a hassle for the average traveler, especially as individual airlines each have their way of doing things.

Airlines are still held to certain compensation thresholds, which differ from country to country. In the UK, passengers are entitled to compensation of £220 ($275) for short flights and £350 ($436) for a flight of 1,500–3,500km in the event of a three-hour delay. For flights over 3,500km, travelers will receive £520 ($648) for a delay of three to four hours.

Grant Schapps also called on airlines to stop overbooking flights, leading to more unhappy travelers seeking compensation.

Ensuring fair consumer rights

Although an automated reimbursement scheme would certainly bring benefits, such as quicker compensation and a more straightforward claim process, it should not come in exchange for diminished consumer rights.

Lisa Webb, Which? Consumer Law Expert, believes the UK government's proposals for automated reimbursement should be rejected in their current form.

Webb said,

"While automatic compensation could ensure passengers get the money they are legally entitled to for severe flight delays and last-minute cancellations swiftly, it must not be introduced at the expense of weakened compensation rights elsewhere, which is what the government is currently proposing."

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Changes coming to the UK summer

Last week, the UK government held a meeting with airline heads regarding changes before the summer rush, as the aviation industry seeks to avoid a repeat of recent scenes in UK airports.

Chief executive of Airlines UK, Tim Alderslade, said,

"We want to work collaboratively with ministers to resolve these issues as quickly as possible, in good time for the summer peak, and it was good to discuss options with the transport secretary during what was a productive meeting. We ultimately have to work together to solve this. Aviation is a complex ecosystem with lots of moving parts and we can’t operate in isolation."

The idea of automated reimbursement may be a step in the right direction, but getting the particulars right is the difficult part. The government has formed a working group and will thrash out proposed changes in the coming weeks.

Schapps said,

"We’ll work with the industry very hard between now and the summer to ensure there is proper disputes resolution, proper charter for passengers, to make sure they can get quick, straightforward compensation for it or be put on other flights."

Do you think the aviation industry would benefit from automated reimbursement schemes? Let us know your insights in the comments.