‘WTAAA's Agenda Is To Establish Relationships Between Associations And Countries’

The World Travel Agents Association Alliance (WTAAA), a new world alliance designed to bring together key travel agencies and organisations, was formed in April 2005. Mike Hatton, recently elected as president talks to Reema Sisodia about the alliance, its links with the Indian trade and his view on the commissions and management fee concept

When and why did the WTAAA come into force?

The organisation came into force on April 20, 2005 in Geneva. It aims to facilitate exchange of information and advice on matters of mutual interest to its members around the globe.

What is the focus of WTAAA?

The organisation brings together countries that have a like minded approach to issues facing the industry. It seeks to have an open dialogue between its members, so that they can learn from the experiences of countries around the globe. In addition to air transport, the WTAAA's agenda includes establishing relationships between associations and countries and providing information regarding the cruise, land and hotel policies in member countries.

In addition to the air transport policy, the WTAAA is also expected to have inputs into a wide range of travel and tourism-related issues including areas such as international cruise line and hotel policy. It will also provide a forum that will consider common strategic goals and management of issues that are of critical interest to the members of the group.

What prompted the establishment of such an association?

The WTAAA members, that include USA, Canada, Australia, New Zealand, South Africa, the UK and all EU countries, have had a long history of informal working relationships. During a meeting held in Washington DC in March 2005, it was decided to formalise the relationship between the parties and that is how the WTAAA was born.

How is the organisation relevant to India?

WTAAA has strong links with the Indian trade, which makes it easy for us to take up issues and problems that the Indian market is faced with. This can also be applied to the global situation (such as the Global IATA contract) and assist Indian operators with advice and take up issues on a global basis with the relevant entities on behalf of Indian operators.

What are the future plans of WTAAA?

It is still early to comment but WTAAA will meet again in London in November 2005, where membership and future directions for the organisation will be discussed in detail.

How does one apply for membership?

Interested parties need to request membership that will be considered at the next meeting of the WTAAA. Membership is applicable to national associations only.

What are the primary issues that the WTAAA aims to address and resolve?

The primary issue facing us at the moment is establishing a solid working relationship with airlines and others on a global basis. The global travel industry is experiencing massive changes and many WTAAA member countries are ahead of India and can therefore India can benefit through their experience. Our aim, is to assist and facilitate negotiation so that changes can be made in a manner that will benefit all industry stakeholders and does not adversely affect our travelling clients.

What is your opinion on the commissions and management fee concept?

The fact is that under the IATA Passenger Sales Agency Agreement - a global contract, under which all travel agents work, an airline can change the manner and amount of remuneration paid to an agent. However, in doing so the airline needs to be cognizant of the socio-economic situation in force in the market under question. The problem is that most airlines do not take into account any of these factors and are simply moving the goal posts to suit their own financial ends by reducing commission payments to agents.

In addition, under the global contract, agents work in an agent-principle relationship, which works under the assumption that the agent should be paid for the work he does on behalf of the airline. By denying or reducing agents' commission, and in many countries forcing agents to charge the consumer, airlines are in fact imposing a price increase on the public. This should be done in a transparent manner by increasing ticket prices.

So where does this commission finally go?

Commission cuts are done on the basis of cost reduction for the airline. But nowhere has such reduction been passed on to the consumer in the form of lower fares. It has actually gone straight into airline bank accounts and the end result of that reduction has been passed on to the public in the form of agents charging them a fee. In other words, airlines profit by keeping the commission reduction in the bank without reducing prices thereby avoiding bad publicity by forcing the agent to be the bearer of bad news to the consumer, if he has to charge the consumer.

What kind of solution do you propose to rectify the situation?

There can be no doubt that airlines will adopt commission reduction policies in the Indian market as they have done in many other parts of the world. What airlines need to do is talk to agents and decide how and where changes can be implemented in a smooth manner that will benefit everyone. They also need to take into account the socio-economic environment, National carriers in my view have a responsibility to their nation and its consumers and should act responsibly in that context. That is precisely what Qantas does in Australia. Any change that is implemented should be done giving maximum lead time.

During that time, airlines are responsible to their agents, to train them, work with them to incorporate systems, procedures and electronic solutions, to facilitate changes implemented during the notice period, and to be honest and alert the public about the change, the reason for the change and its the effect on the final cost to consumers.

Who are the founding members of WTAAA?

The founding members of the group consists of the American Society of Travel Agents (ASTA), the Association of British Travel Agents (ABTA), the Association of Canadian Travel Agents (ACTA), the Australian Federation of Travel Agents (AFTA), Deutscher Reiseburo und Reiseverenstalter Verband (DRV), the European Travel Agents' and Tour Operators' Associations (ECTAA) and the Travel Agents' Association of New Zealand (TAANZ).

The Association of Southern African Travel Agents (ASATA) has also joined the group since the initial issuance of the new organisation's Memorandum of Understanding. The International Air Transport Association (IATA) has been informed of the new alliance and we have received positive signals from other nations as well, who are showing a desire to join us.