Thomas Cook: Peterborough MP calls for government 'leadership'

The MP for Peterborough is calling on the government to "show leadership" and bail out the tour operator Thomas Cook as it continues to stave off collapse.

The travel company employs 1,000 people at its Lynch Wood headquarters, and a further 21,000 people in 16 countries.

The 178-year-old firm has approached the government in an attempt to plug a £200m gap in its funding.

Lisa Forbes MP said her thoughts were with city employees "whose jobs and livelihoods are at risk".

The troubled travel firm hoped to seal a rescue deal led by China's Fosun Tourism this week.

But the creditor banks - RBS and Lloyds - issued a last-minute demand that the travel company find an extra £200m.

The Civil Aviation Authority is on standby with a repatriation contingency plan to bring home 150,000 stranded UK holidaymakers should the firm fall into administration - with that cost put at £600m.

Ms Forbes, a trade union activist who worked for Thomas Cook in Peterborough, said a bailout would "save the taxpayer money, save thousands of jobs and an iconic British business."

She called on the government to "show leadership" and support Thomas Cook "instead of pushing them towards a cliff edge".

Thomas Cook's headquarters have been based in Peterborough since 1977.

"The Transport Salaried Staff Association (TSSA) have previously said that their members have had a terrible time over the last months due to the uncertainty of the rescue talks and the future of the company," she said in a statement on Twitter.

"A few months before Christmas, I can't begin to imagine the worry faced by many in the city today," Ms Forbes said.

"These are good, hard-working people who deserve better.

"It is vital that the management are in regular discussions with trade unions and employees on how jobs can be protected and on the state of play financially."

In his blog, BBC business editor Simon Jack says the government does not recognise the choice being presented to it of a £200m cash injection versus a £600m repatriation bill.

He says the government's understanding is that most Thomas Cook customers will be covered by travel insurance or Atol protection to pay for repatriation costs - a fund paid for through industry levies.

On Friday, Thomas Cook, told worried customers to ignore media speculation but are now reminding them they do have Atol protection "in the event that Thomas Cook goes into administration".