British holidaymakers due to head for the US in the next few days are to be given a compensation package, UK tour operators announced today.

Anyone due to take a package holiday to New York, Boston or Washington in the next seven days will be offered a free transfer of their holiday or the option of cancelling without incurring any penalty.

The transfer or cancellation offer also applies to other holidaymakers taking package trips to the rest of the US and Canada - but only for those due to travel in the next 48 hours.

The Federation of Tour Operators, which agreed on the deals after meeting today, said it would review the situation "on a daily basis".

A Thomson Holidays' spokeswoman said: "This deal is just for package holidaymakers and those travelling on scheduled flights should contact their airline.

"Few people will want to go on holiday to New York at the moment but travel demand for other areas of North America is not expected to be so much affected."

She went on: "It's a little early to say what effect all this will have on package holiday travel. Much depends on how America retaliates or if the US economy suffers."

All transatlantic flights have been cancelled, throwing British airports into turmoil.

Although European flights are still operating, the knock-on effect of the cancellations will mean delays for all passengers.

Security has been stepped up at airports while Britons abroad have been warned to keep a low profile and keep an eye on news developments.

Dave Jopling, director of Corporate Travel International, in Skeldergate, York, has a number of clients stranded in America.

"We have people stuck in New York, in Washington and we had people who were due to fly out yesterday who got turned back," he said. "I will know more in time but at the moment it is mayhem."

He added that a group from Leeds was brought back from New York via Amsterdam early yesterday morning.

Other travel agents in the city reported receiving cancellations from those due to fly to America, particularly New York, in the next few days.

A spokesman for Manchester Airport said: "Although transatlantic flights are not operating at the moment, we advise passengers due to travel to the USA and Canada to contact their travel company or airline for advice on whether to come to the airport.

A spokesman for the Foreign and Commonwealth Office said: "Following terrorist attacks on Tuesday 11 September there remains a strong risk of further atrocities. Flights across the US have been cancelled. Anyone planning to fly to or in the US should contact their carrier to check whether the flight is still scheduled."

The Foreign Office emergency number for worried relatives and friends is 0207 008 0000.

Meanwhile, a spokesman for the British Transport Police said the force was on alert on the railways.

The effect on the railway system is minimal, although problems were reported in central London during yesterday's evacuation.

Lin Everett, from York, is due to fly with her family to Florida on Friday. "If we are allowed to fly I will definitely go," she said.

"There is no safer time to fly as safety and security will be a priority. I would have no hesitation in flying if we are allowed."

Flights in and out of Manchester Airport were suffering heavy delays today and budget airline Easyjet has cancelled a number of flights across Europe.

The attack has sparked fears over petrol prices. The price of oil rose immediately after the incident amid US fears of retaliation in the Middle East.

Updated: 14:37 Wednesday, September 12, 2001