Minister denies Brexit connection to Thomas Cook collapse

Matt Hancock has claimed that the Thomas Cook collapse was not related to Brexit. Photograph: Stefan Rousseau/PA. - Credit: PA Wire/PA Images

A government minister has claimed that there is no connection between Brexit and the collapse of Thomas Cook despite the company’s own reports discussing the effects of the referendum.

Travel company Thomas Cook has failed to receive a £250 million government bailout and announced its liquidation after months of reports it was struggling.

Health and social care minister Matt Hancock was asked on LBC whether the fall of the pound as well as Brexit uncertainty had anything to do with the company’s decline, and said: “No. I don’t think there’s any Brexit connection”, blaming it instead on people being able to book their own holiday directly online.

But Thomas Cook’s own corporate reports ever since the referendum have cited Brexit uncertainty as one part of the picture affecting its performance as a company.

The travel agent’s annual reports have cited difficulties stemming from the decline of the pound against the dollar and the euro since at least 2018.

The company called for “urgent clarity” from the government and the EU about transition agreements in 2017.

Its 2018 annual report said: “As a pan-European business with a major UK operation, lack of clarity on Brexit has been a major source of uncertainty for the European travel industry, and the business.”

And by April this year, the company said that Brexit was leading people to hesitate to book holidays.

A press release said: “It is now clear that the prolonged uncertainty around the manner and timing of Britain’s exit from the European Union has led many to delay their decision on when and where they book for their summer holidays”.

The company’s 2019 half year results also stated that political uncertainty has led to “softer demand”, and that their margins were still under pressure thanks to competition as well as Brexit.

In May 2019, CEO Peter Frankhauser said there was “little doubt” Brexit was making customers hesitate to book.

He blamed 2018’s heatwave, higher prices in the Canaries, and added: “There is now little doubt that the Brexit process has led many UK customers to delay their holiday plans for this summer.”