Have your say: Travel Industry Compensation Fund Management Board Chairman Chan Tze-ching (second right) and members launch the public consultation on the fund.

The Travel Industry Compensation Fund Management Board is inviting public views on proposals to introduce a mechanism to adjust the levy contribution to the fund and enhance traveller protection.

Board chairman Chan Tze-ching said today it is time to review whether to establish a mechanism for suspending and resuming fund-levy collection and whether there is scope to enhance the fund's protection to travellers and reduce the levy burden on travel agents.

The consultation has four proposals:

* putting in place a mechanism with triggering thresholds to suspend or resume the collection of the levy;

* reducing the levy rate to naught when the fund balance reaches $500 million;

* increasing ex-gratia payment ceilings from $40,000 to $100,000 for the funeral, cremation or repatriation of the remains of a dead outbound traveller and compassionate visits by the relatives of an injured or dead traveller; and,

* allowing outbound travellers to make advance authorisation before departure on outbound package tours to enable their authorised representatives to apply for ex-gratia payments if needed.

Prudent level

On the basis of professional actuarial findings the board proposes to set the fund's prudent level at $400 million and the buffer level at $500 million. Levy suspension is suggested when the fund balance reaches $500 million, and resumption when it drops below $400 million.

"The introduction of such a mechanism will help enhance the transparency of the fund levy setting process and allow a predictable and timely response to market changes based on objective criteria," Mr Chan said.

The board will regularly review the prudent level with a view to recommending adjustments to the triggering thresholds as and when necessary. The frequency of reviews should be no less than once every three years.

Based on the proposed adjustment mechanism the board proposed the fund levy rate be reduced to naught for now to help lower travel agents' operating costs and package tour fares amid the financial crisis.

People can send their views in writing to the board at Room 4901, 49/F Hopewell Centre, 183 Queen's Road East, Wan Chai, or send an email or fax (2521 8829). The consultation will end on April 30. Click here for the consultation document.