ACTA, CATO, TICO Square Off Over Review Of Funding Framework

ACTA and CATO are joining forces to express their shared concerns about Ontario’s provincial travel regulator and in particular their opposition to maintaining the current registrant fee system to fund the Ontario Consumer Compensation Fund.

In response, however, TICO has made it clear that from the beginning of the review, it has been “committed to this being a transparent process” and that “all funding options were on the table.”

ACTA, CATO Voice Shared Concerns

The ACTA and CATO statement notes that following the announcement by TICO earlier this year that it was launching the largest review of its funding framework and fee structure since inception, the two associations said in a joint statement that they have been kept largely in the dark on the financial impact on TICO registrants.

This comprehensive review includes modernization of TICO’s current funding framework to ensure sustainable operations of TICO, as well as a full review of the Compensation Fund and associated contributions.

Jean Hébert, CATO Executive Director, said: “Travel registrants will once again be called upon to pay the rising and staggering costs of an inadequate and costly system that doesn’t offer very much to consumers. TICO’s core mandate being consumer protection.”

ACTA president, Wendy Paradis pointed out that: “While both organizations applaud the review of TICO, a full review of all TICO programs and administrative costs is needed.”

Paradis continued: “We hope the current audit conducted by the office of the Ontario Auditor General — dubbed the ‘Value for Money audit’ — will provide positive results and responses to our concerns.”

However, Paradis noted: “We are very concerned that nowhere does it appear to mention moving to a consumer ‘insurance’ contribution model, that we have long been advocating.”

And Hébert made it clear that ACTA and CATO will not stay silent until they are informed of the final decision.

CATO’s executive director said: “We will mobilize to make sure TICO and the Ontario government will consider our recommendations and stop placing this unfair and uncompetitive burden on travel businesses.”

Hébert added: “This is the biggest fee review in TICO’s history and yet when we met with TICO’s consultants, we have been provided with very partial information and no financial impact analysis on the industry.”

Said Hébert: “We do not appreciate being kept in the dark, we do not appreciate being told that our asks will once again be ignored without any reason or explanation.”

As for Paradis, she said bluntly: “We are extremely frustrated with the process,” before continuing: “Since the pandemic, the travel industry is still struggling to recover from the decimating effects of the COVID-19 health and financial crisis.  Travel businesses in Ontario are struggling with a post-pandemic debt load that is significant.”

TICO Responds

In response to the joint statement by ACTA and CATO, Richard Smart, TICO’s CEO, said that: “TICO is actively conducting a comprehensive review of its funding framework, including the Compensation Fund. Since the start of the review, we have been committed to this being a transparent process.”

Smart continued: “We have said that all funding options were on the table and would be explored and considered for a future funding model. As part of the review, a variety of stakeholders have been engaged to provide their input, including the trade associations, registrants, and Ontario consumers. Jurisdictional scans were conducted to understand models in other provinces and countries, their successes and also their setbacks.”

And TICO’s CEO concluded: “The final recommended approach is subject to a review by the Ontario government prior to being shared publicly. Once released, all registrants will have an opportunity to provide their feedback through a broad consultation process. The goal of the future funding framework is an innovative funding model that meets the needs of consumer protection today and the future.”

What Do ACTA, CATO Want?

As for what ACTA and CATO want, the associations’ statement noted that they have long demanded a new funding model that will provide a fairer playing field and real protection to the consumer.

The two associations have been working together and increased their advocacy efforts on this review process and have called for:

  • A legislated Consumer ‘insurance’ contribution system similar to the one in Québec for an adequate Compensation Fund and real protection. In Québec, the consumer pays for that protection approximately $3.50 per $1,000 in travel expense.
  • Full review of TICO programs and expenses
  • Fix the Compensation Fund or eliminate it
  • Exempt Corporate Travel agency clients from Fund

Said Paradis: “We are very concerned that after many, many years of the industry calling for a fairer funding model of TICO — where the consumer is aware of the benefits of paying into an insurance program and receives better protection — once again our demands have been ignored.”

And ACTA’s president concluded: “The burden of enhanced consumer protection will continue to be placed squarely on the industry and at a higher cost than ever.”