To think it’s right that governments shouldn’t bail out Thomas Cook?

[PrettyShiningPeople]

There’s a petition doing the rounds calling for the government to bail out Thomas Cook and it’s already got the required number of signatures.

I’m just baffled. I have a great deal of sympathy for all those who’ve suddenly found they are redundant, but the idea that the taxpayer should step in when senior management have been creaming off millions of pounds of bonuses over recent years is quite honestly ridiculous.

If it was a company providing essential services or if there was a strategic interest in ensuring it was kept afloat that might be different.

AIBU?

Sorry, didn’t check thread title before posting. Was going to say private holiday firms but then changed it to Thomas Cook.

Agree. This isnt a major bank, care service or support service going under.

It is incredibly unfortunate for those that have lost their jobs and I really hope they manage to get themselves something quickly but clearly something went wrong with business management and that isnt down to the government (tax payer) to rectify.

If it emerges that thousands of people will lose earnt pensions etc which will inevitably but a strain on society when they hit retirement age then yes the government could do something to help that as it will impact the coffers eventually anyway.

I read that it'll cost 4 times as much to repatriate brits stranded as it would have cost to bail them out though not sure if that's true... I do agree that it's not a vital service and the fat cats at the top should be more liable

I think this was only raised because the cost of the repatriation is going to be higher than the amount they needed to stay afloat. But realistically the government would never have bailed them out as same thing would have happened again in a few months time most likely. And they'd already set an example with carrillion which had a much bigger impact on public services than this will.

Presume the debate will never go ahead as they've already gone into administration and the repatriation is already occurring. Other firms will naturally take over the extra capacity in the tourism industry.

Pensions are a complete non issue as defined benefit funds are protected by the pension protection fund hence picked up by government anyway (which was hit massively by carillion, but probably a lot fewer employees at Thomas Cook on defined benefit schemes)

It's darned right the Govt won't bail them out. Directors were still taking their million £ salaries and bonuses right up to the end. This is a classic case of poor business management - they bought out other failing companies, had too many High Street stores and weren't competitive on low cost flights.

Their Directors are responsible for this fiasco. No one else.

i feel very sorry for people who have lost their jobs and had holidays ruined. but no idea why people think the goverment should bail a private company out.

There is a lot of talk £200m to save them but £600m for repatriation.
The reality is they are 1.8bn in debt and the summer season is over. So the 200m would probably only have bought them few months.
Then we would be right back here..

The Government made the right decision in not bailing out TC.Yes it might have fixed the immediate problem of cash injection but what would also have happened would be a temporary solution and would have been needed again and again,This is /was a badly run company that had greedy owners who ballsed up.I am so dreadfully sorry for the staff though it must be horrendous for them.

Totally agree. Thr money they requested was simply cash flow to pay the bills. The same thing would have happened in three months or six months, how often does rhe government bail out companies, what is the parameters for doing so.

They can't just throw money unless there is sound reason, and a way to ensure they stay in business. You can't throw money at them just for them to go bust a few weeks later.

Thomas Cook was actually in UK public ownership from 1948-1972.

I do wonder if the government could have offered the £200million but with conditions for a stringent reorganisation - not to make a long term government owned travel company, but to allow for a more orderly run-down.

The people calling for a bail out of a holiday firm (not an elderly care provider, not a prison security company, not a bank, whose collapse has very scary life and death implications).... Are idiots. Very short sighted. I thought it was a joke at first!

Yes, it's the right decision because it's likely that it would have only been a temporary fix and they would have probably been in the same situation this time next year.

It's like retail in general. Not enough people book holidays via a high street travel agent to warrant their network of shops, so they'd need significant changes to keep going as a business and most of the people working in the shops would probably have lost their jobs anyway.

Since TC started selling package holidays in the sun to the masses, package arms of other airlines like EasyJet and Jet2 have entered the market, offering a similar product, often cheaper, partly due to being entirely internet based.

Plus there's the massive debt that there's probably little chance of paying back, plus Brexit, exchange rate and economy related issues adding to the difficulties. And the brand became so tarnished that people would choose to book with someone else.

I really feel for the employees, customers and suppliers but nevertheless I don't feel the government should bail them out. Remember, when you say the government, you actually mean all of us taxpayers.

We cannot bail out all companies that go bust because there are plenty of companies whose management makes poor decisions and some who are never going to be financially viable.

We need to realise the government's purse is our purse and treat it as such. If I don't have the money for something I go without it and/or save until I do have the money. On occasions I have borrowed from a bank at a rate and for a length of time I can afford. The government should be the same.

Thomas Cook needed to look at what they were offering their customers. They needed a unique selling point to make people choose them over other holiday companies/travel agents who are financially viable. I'm not aware they have one.

Nevertheless, sending out sympathy and good wishes to everyone affected by the sad demise of Thomas Cook.

The "bail out" was a sticking plaster solution. The company would have been in the same position this time next year and has been on the slide for years.

Totally different from the banks who are still trading 10 years down the line.

CAA lady on TV this morning said repatriation will cost tax payers £40million,

@kitk

"I read that it'll cost 4 times as much to repatriate brits stranded as it would have cost to bail them out though not sure if that's true"
I heard on the news yesterday an estimate of £100m to repatriate everyone but that is split 40%/60% between govt and atol (can't remember which way round it was).

The £200m bailout sought from the government was just to try and get Thomas Cook through the winter. They would have required more money to carry on but they would have required a total rethink of their business model as theirs clearing wasn't working.

Lufthansa, Hi Fly, Virgin Atlantic and private equity firm, Triton, were all interested in buying their airline but didn't in the end. Jet2 said they weren't interested. There is a reason why these companies did not want to buy and that same reason is why the government shouldn't bail them out.

No definitely not or they would have to bail out everybody. It’s no more an essential service than for example BHS or Woolworths

I was one of the customers screwed over by TC and even I don't think the government should bail them out! I'll get my money back eventually but it would be an improper use of taxpayers money to fund these companies who shirk their responsibilities to customers & employees. The fat cats are likely still living the life of luxury and pocketing bonuses up until the last possible moment. I hope they are ashamed of themselves for what they have allowed to happen to such an established company; run into the ground by greed and poor management. It is not down to the British public to fix this.

I think this is going to happen more frequently now. Cost of travel (and everything else too) is only going up, Brexit will deter so many from going abroad, lots of holiday companies are going to struggle. There’s no way the government should step in to bail them all out. If they’re smart they’ll take TC as a glimpse of how they’re headed and take action now to prevent it. The greedy ones won’t though. It’s the customers who will pay and lose.

the 200m was an additional amount that Thomas Cook needed to find to try to secure a rescue bid for 900m. 200m sounds nothing and you think why not but even if the government gave them that the 900m could still have fallen through meaning they would have gone under anyway.

TC business model just doesn't work in the world today and wouldn't going forward. If they didn't go now they would have gone soon.

Deepest sympathy to all their staff and customers who are all going through hell now.

Well it’s a resounding no from Mumsnet! I just couldn’t fathom how this petition seemed to have attracted so much support. To me this kind of thing demonstrates why it’s probably a bad idea to involve ordinary folk in political decisions. (Bitter about Brexit much?)

So, the government forks out £200m and then still has to pay to repatriate stranded customers when the business collapses in a year’s time. No thank you.

They’ve been bailed out so many times by their lenders it would be throwing good money after bad.

The period has gathered momentum because of sentiment.

It wasn’t Thomas Cook’s idea to be bailed out, it was a random idea by the travel union with the purpose of saving jobs. A lovely sentiment, but the company would be in exactly the same situation in three months and then what do you do? It’s a very short sighted view. Actually those people are better off seeking secure employment, and most of them will quite quickly (I’m thinking of Woolworths as a comparator - the vast majority of their ex employees found work quickly, and that was in the midst of the economic downturn).

The government “lent” British Steel £120mil in May, weeks before it collapsed putting 5000 jobs at risk. Once bitten, twice shy and all that. And British Steel is much more part of British industrial infrastructure than T cook.

It’s totally different to bailing out the banks. Banking is part of the national infrastructure - to have let a bank fail would have had an enormous impact on more than just jobs, it could collapse the mechanisms and structure of society generally. Thomas Cook was a holiday company. No comparison.

And by the way the directors will most probably have to pay back any recent bonuses they received.

The government can’t bail out everyone, it’s ridiculous.

There’s a lot less demand for travel agents than there used to be. They didn’t adapt. Tough titty.