Business

Thomas Cook ex-boss grilled over £500,000 bonus

Media playback is unsupported on your device
Media captionThomas Cook ex-boss on bonus: 'It's not up to me'

Thomas Cook's ex-boss has been grilled over a bonus payment of £500,000 and said he was not the only one to blame for the holiday firm's collapse.

Peter Fankhauser told a cross-party committee of MPs that he worked "tirelessly" for Thomas Cook.

While he was sorry for the collapse, he said the reasons were "not one-sided".

Committee chair Rachel Reeves, who asked Mr Fankhauser if he would give the bonus back, told Mr Fankhauser his apologies rang "rather hollow".

Mr Fankhauser and other members of Thomas Cook's former management were being questioned by MPs over what led to the liquidation of the business on 23 September which cost thousands of jobs and left many holidaymakers stranded overseas.

The former chief executive said that he did not receive a bonus in 2018 but had received a £750,000 bonus in 2017 - two-thirds of which was in cash, the rest was in shares.

'Deeply sorry'

Ms Reeves asked Mr Fankhauser if he would return money to repay taxpayers for the massive repatriation programme to bring 150,000 holidaymakers back to the UK and help fund redundancy payments to staff.

He said: "I fully understand the sentiment in the public and I understand the sentiment of some of our colleagues.

"However, what I can say to that is that I worked tirelessly for the success of the company and I am deeply sorry that I was not able to secure the deal.

"But it was not one-sided that I failed. There was multiple parties who had to contribute to the deal which finally then did not succeed," he said. Mr Fankhauser said, on reflection, he will "consider what is right but I'm not going to decide that today".


Image caption Watching Mr Fankhauser's evidence has not eased the pain for Betty Knight

The pain of losing her job is still raw for Betty Knight. Watching Peter Fankhauser being grilled by MPs brought a tear to her eye, especially when Rachel Reeves spoke of his failings and the damage done to staff and holidaymakers.

The former member of Thomas Cook's cabin crew said some of Mr Fankhauser's answers "were still tinged with arrogance". She did, though, give him some credit. "I still believe, in those final few months, they did work very hard to try to turn this round," Ms Knight told the BBC.

An employee for 13 years, she admits to still being in denial that the company no longer exists. "But I don't feel as angry as I did."

One thing that still grates, however. Even as Mr Fankhauser explained how management had worked tirelessly, it did not sooth her anger that huge salaries and bonuses were paid out for failure. "They should have been paid on results," she said. "That's just the way it should have been."


Ms Reeves asked the former chief executive of Thomas Cook why he held on so long for a financing deal to save the company which he "knew was never going to happen"?

Mr Fankhauser said he was "confident" it was going to happen: "Otherwise I would not have tried so hard and I had the backing from the banks and I had the substantive agreement on 28 August from the banks and the bondholders."

Media playback is unsupported on your device
Media captionFomer Thomas Cook staff back at work

He told MPs that he met with transport secretary Grant Shapps on 9 September and claimed that if the government had backed Thomas Cook's rescue plan, the travel operator would have survived.

"We made an estimate how much could the collapse of Thomas cook cost, that was far higher than what we requested," he said, but added "I honestly don't dare to criticise the government.

"I firmly believe that after the recapitalisation... we would have had a new start".

In the end, he said, the government did not want to set a precedent. "I was awfully sad," Mr Fankhauser. "I knew I would have to throw in the towel".

Last week, Sunderland-based firm Hays Travel announced that it would take over 555 Thomas Cook shops, in a deal that could potentially save 2,500 jobs.

Mr Fankhauser said the announcement was "honestly one of the bright days in the last three weeks".

More on this story