If you’re waiting on a flight ticket refund, you’re not the only one. However, in an announcement this week, Canada’s Transport Minister addressed the potential consequences of cash refunds from Canadian airlines. He argued that reimbursing passengers could lead to some leading airlines going bankrupt.

Just one week after the Prime Minister promised to have “discussions” with airlines about refunding passengers for pandemic-related cancellations, Canada’s Transport Minister has spoken out about the potential repercussions.

In a press conference on May 29, Marc Garneau explained that while passengers’ desire to be refunded was understandable, the potential effect on the airline industry could be “devastating.”

"I have said many times that I have enormous sympathy for those who would have preferred to have a cash refund in these difficult circumstances. It is far from being an ideal situation," he said on Friday.

"At the same time, if airlines had to immediately reimburse all cancelled tickets, it would have a devastating effect on the air sector, which has been reeling since the COVID 19 pandemic started."

The minister went on to add that if airlines were forced by the government to issue cash refunds to all passengers, it could result in some of them financially failing.

"It is so essential for this country. This is the second largest country on Earth, with its distances and remote areas, and we expect and need an airline industry in this country," he explained.

Garneau's comments come just one week after Prime Minister Justin Trudeau promised to have “careful discussions” with Canada’s airlines about refunding passengers who have had flights cancelled due to the ongoing pandemic.

For the time being, many of Canada’s leading airlines are not offering their customers monetary refunds for cancelled flights, instead only offering travel vouchers or credit.

In response to these cancellation policies, one woman launched a class-action lawsuit against some of Canada's leading airlines, including Air Canada and WestJet.

However, despite the backlash from some passengers, Trudeau also noted the importance of protecting Canada's air travel industry.

"I think we need to have some very careful discussions with airlines ... and indeed with Canadians who are concerned ... to try and figure out a way forward where we can ensure that Canadians are treated fairly, and our airline industry remains there for when the economy picks up again,” he said.

Earlier this week, Air Canada announced an update to their cancellation policy. Under the new regulations, customers have the option to receive travel vouchers with no expiration date or Aeroplan Miles.

Cash refunds are still not an option for those with non-refundable tickets.

*This article's cover image is for illustrative purposes only.

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