Sale of Tickets (Sporting and Cultural Events)

– in the House of Commons at 2:07 pm on 4th March 2014.

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Motion for leave to bring in a Bill (Standing Order No. 23)

Photo of Nick Smith Nick Smith Labour, Blaenau Gwent 2:09 pm, 4th March 2014

I beg to move,

That leave be given to bring in a Bill to regulate the selling of tickets for certain sporting and cultural events;
and for connected purposes.

The Bill I am proposing today speaks to anyone who has loved something enough to want to see it live. For me, that is rugby. In 2015, this country will host the rugby world cup, one of the premier events in the sporting calendar. On the field, our teams will be doing their best to bring the cup to these shores, but who will be cheering them on from the stands? In an ideal world, the most committed fans will be rewarded with a chance to see a once-in-a-lifetime event—Wales becoming rugby world cup champions.

Many fans will be forced to pay sky-high prices in a rigged secondary market. I used to believe that ticket buying was a fair lottery where a quick phone call or a mouse click would give someone the chance to see their heroes. Unfortunately, all too often, the true fans do not stand a chance. The touts have evolved from blokes in sheepskin jackets lurking outside stadiums trying to sell spare tickets to becoming sophisticated people, harvesting thousands of tickets just seconds after they go on sale. These people have been described as power sellers. Using multiple credit cards and sometimes computer programmes called “botnets”, they are able to make thousands of attempts to get tickets each second, manipulating the market and claiming large pools of tickets.

This is a story that has been repeated across the country. Monty Python fans discovered that just three months ago. The much-anticipated comeback show sold out in 43.5 seconds. In 2012, the Rolling Stones attacked secondary sites after sky-high prices—up to £1,300 a ticket—meant that their 50th anniversary tour was littered with empty seats. Even the Chelsea Flower Show is not immune. Prince Harry’s attendance in 2013 saw record ticket sales, with £22 tickets going for as much as £466.

This Bill calls for two things. The rugby world cup should be designated an event of national significance, and it should be illegal to resell tickets for profit. For all other events, there should be a cap on the amount for which a ticket can be resold. We are letting down the fans by not giving them a chance of a fair deal. We must call time out, and stop new internet spivs fleecing honest fans.

To see what sort of prices the secondary sites command, I took a look at the prices for a rugby world cup game that I will be watching with great interest—Wales’ victory over England. Tickets are not even on sale yet, although the organisers have said that they will range from £75 for the cheaper seats to £315. However, a quick search on Google turned up a range of prominent secondary sites already offering tickets at prices ranging from £920 to £1,725. That kind of ticket touting is parasitic. It leeches off fans who are desperate to see their heroes and organisations that are charging fair prices.

The Rugby Football Union tells me that it puts every earned penny back into the game. It has ambitions to grow the sport as part of the rugby world cup legacy, just as the Olympics inspired our next generation of superstars. However, these grossly inflated ticket prices will not result in a single extra ball for a school's kit bag.

I have heard the argument that resales do not cost the event organisers a penny, as they have already earned the face value of the ticket. That could not be further from the truth. Kilimanjaro Live, an events promotion company, estimates its costs of policing resale of tickets to be more than £100,000 a year. The National Theatre spends tens of thousands a year, as does the RFU. The misleading nature of online ticket touting means that many people buy tickets believing that they are coming from fellow fans. The first web page they come to may be a secondary sales site and the uninitiated could believe that they are buying from the only outlet or paying a fair price, when really they are being ripped off. Unfortunately, despite evidence of touting in the secondary market, the Government refuse to designate the rugby world cup 2015 as a competition of national significance as was done for the 2012 Olympic and Paralympic games.

Designating the games in such a way would make it illegal to resell tickets for the tournament. It is urgent that the Government act to protect genuine rugby fans from being exploited by online rip-off merchants. Tickets for the rugby world cup 2015 will be sent to rugby clubs in May and go on general sale this autumn. Even at this late stage, if the Government were to bring forward legislation to make the rugby world cup an event of national significance, Labour would give them their support.

Before I finish I would like to place on the record my thanks to my hon. Friend Mrs Hodgson and other colleagues in the all-party group on ticket abuse who are showing important leadership on consumer rights. Our concerns include the business practices by companies such as Viagogo. Just last night I pressed it on its supply of tickets from the power sellers and the public selling tickets they cannot use. It said there was none. We are also concerned that the secondary market and its exorbitant prices are the only game in town thanks to mass ticket touting, and that there are links to organised crime as identified by police Operation Podium.

Like my hon. Friend, I believe we can only address the industrial ripping off of consumers with regulation. To deal with the power sellers, resale prices should be capped at say 10% or 20% of face value. Although that needs further discussion, our overall objective must be fairness to fans.

Fans need to know that they can buy a ticket in confidence without being gouged financially. When it comes to nationally significant events such as the rugby world cup, fans also need to know that if they cannot attend the event, they can sell their ticket back to the organisers and recoup the cost. The Bill would not stifle the right of the genuine fan to buy and sell tickets for most events at a fair price when they can no longer attend. Instead, real fans would get back the first-come, first-served fairness of buying direct. They would be protected from internet chicanery, crowding them out and ripping them off. We need to end the market manipulation for sporting and cultural events in this country.

Photo of Philip Davies Philip Davies Conservative, Shipley 2:17 pm, 4th March 2014

I rise to oppose the Bill not just because of the delusional prediction that Nick Smith made about the forthcoming match between England and Wales but because of the nature of the Bill itself. I suggest that the hon. Gentleman starts off by looking at the report, which was produced in the last Parliament, of the Culture, Media and Sport Committee of which I was, and happily remain, a member. It found that the secondary ticketing market was perfectly legitimate. Furthermore, the Office of Fair Trading also concluded that the secondary ticket market worked in the interest of the consumer.

The hon. Gentleman might want to consider the evidence given to our Select Committee by Margaret Hodge when she was a Member of the previous Labour Government. She gave a particularly robust defence of the secondary market and why Labour did not want to interfere in it. He would be wise to read her evidence because it was compelling.

One misapprehension is that ticket touts and people in the secondary market are guaranteed to make a substantial profit, but that simply is not the case. For example, 50% of tickets sold on Viagogo are sold at face value or below and people can make a loss. As far as I am concerned, this is a matter of clear principle. If someone buys a ticket, that ticket belongs to them and they should be able to do what they please with it, just as they should with any other commodity that they buy. For argument’s sake, there are times on the high street when designer handbags come out in limited edition. Some 30 or 40 may be available. It is first come, first served. People rush into the shops to snatch one. They then immediately put them on eBay to make a massive profit. I do not see what the difference is between that and those people who want to sell on a ticket at an inflated price if they think that demand outstrips supply.

That also happens with toys. One Christmas, Buzz Lightyear was an especially popular toy, so people bought the limited stock and immediately sold the toys on eBay at a huge profit. I do not understand why tickets should be treated differently, but perhaps the hon. Gentleman wants to restrict people’s ability to resell any commodity above the price that they paid for it.

The hon. Gentleman fairly made the point—he then disagreed with it—that a promoter or organiser does not lose anything as a result of the secondary ticketing market. If a promoter puts on an event for which there are 50,000 tickets and charges £20 for each, they have decided that they want to realise £1 million from that event. After all the tickets have sold, that £1 million has been made, so whatever happens subsequently makes no difference to the event’s viability or that promoter. The hon. Gentleman talks about people spending money on policing the secondary market, but I suggest that they do not bother, because they then do not waste money doing so and can realise the amount that they get in the first place.

It is absolutely essential that there is a resale mechanism for tickets for the rugby world cup. The supporters of the some of the successful rugby teams, such as the All Blacks, are likely to buy many of the tickets for the final in the expectation that their team will reach it. That might well be the case, but the All Blacks could equally find themselves knocked out in the semi-final and if that happens, surely it would be in the best interests of the competition for there to be a mechanism through which New Zealand supporters may sell on their tickets to the supporters of the teams that reach the final. If those All Blacks supporters are not allowed to resell their tickets in the way that I would like, we will have the ridiculous situation that the crowd at the final is full of people who do not support either team, yet the people who want the tickets cannot buy them.

The hon. Gentleman talked about real fans, but I am not sure what the definition of a “real fan” is. I suggest, Madam Deputy Speaker, that if someone is prepared to pay £1,200, £1,500 or £2,000 for a ticket, you can bet your bottom dollar that they are a real fan. I do not understand the suggestion that selling tickets at inflated prices stops real fans attending events because if people are prepared to pay such prices, the chances are that they are especially keen fans. There is a simple premise that if someone does not want to pay the price that a seller asks, they should not do so. No one forces someone to pay an inflated price for a ticket—it is a free choice. If I decide at the last minute that I want to attend a sold-out event, the secondary market is the only place I can go to access a ticket. I am not sure why the hon. Gentleman wants to remove that choice from people. If I think that the price being asked is too high, I will just walk away and not attend, but at least I will have had a chance to go to that event, although I would have had no such opportunity without the secondary ticketing market.

The hon. Gentleman should be aware that the promoters of many events such as concerts do not offer people a refund if they buy a ticket but then find that they cannot attend. What on earth are such people supposed to do except the perfectly legitimate thing of selling their ticket to someone else?

If event promoters and sports organisers—perhaps the organisers of the rugby world cup—are so concerned about ticket touts and the secondary ticketing market, why do they not do something about it themselves? If they are worried, why do they put all the tickets on sale right from the word go meaning that they sell out in 43.5 seconds, to use the Monty Python example that the hon. Gentleman cited? Why do not they sell a few tickets each week so that tickets are still available at face value in the week before the game or concert, meaning that no one would have to pay inflated prices through secondary ticketing? If this is such a big issue for the organisers of events, sporting fixtures and concerts, they could do something about it at the drop of the hat. However, they do not anything about it, which can lead us to conclude only that they are shedding crocodile tears and are actually rather pleased that they can sell all their tickets in 43.5 seconds because that is good for their cash flow and guarantees a sell-out. I do not think that organisers are as bothered about the situation as the hon. Gentleman would have us believe.

It is often said that public opinion favours restricting the secondary ticketing market, but let me share the results of ICM polling with the House. ICM asked people to agree or disagree with the statement:

“If I had a ticket to a sporting event, concert or other event that I could no longer use, then I should be allowed to resell it”— and 86% agreed. Some 83% of people agreed with the statement:

“Once I’ve bought a ticket it is my property and I should be able to sell it just as I can any other private property.”

Despite such agreement with that premise, the hon. Gentleman argues against it.

I am extremely proud of the fact that when I worked for Asda, before I entered the House, it challenged and overturned the net book agreement, under which publishers set a book’s price and no one could sell it at a different price without the publisher’s agreement. Overturning that agreement has driven down the price of books for consumers throughout the country, but the hon. Gentleman wants a system such as the net book agreement whereby event organisers sell tickets at a particular price and no one can sell them at a different price, which would represent a massive retrograde step for this country’s free market. The Office of Fair Trading concluded that such an system would not work in the best interests of the consumer, but the current arrangements do, as was endorsed by the Culture, Media and Sport Committee. I do not intend to press the motion to a Division, but I hope that the Minister has listened to my objections and that the Government will not go down the route that the hon. Gentleman encourages, which is a rabbit warren that it would be best to avoid.

Question put (Standing Order No. 23) and agreed to.

Ordered,

That Nick Smith, Mrs Sharon Hodgson, Mike Weatherley, Roger Williams, Steve Rotheram, Julie Elliott, Chris Evans, Nic Dakin and Fiona O’Donnell present the Bill.

Nick Smith accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 6 June, and to be printed (Bill 177).