Consumer Protection

– in the House of Commons at 2:08 pm on 11th June 2019.

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Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy) 2:08 pm, 11th June 2019

I beg to move,

That the draft Consumer Rights Act 2015 (Enforcement) (Amendment) Order 2019, which was laid before this House on 13 May, be approved.

Ensuring the safety of UK consumers is a key priority for the Government. It is vital that consumers can trust that the products that they buy are safe. Responsible and law-abiding businesses also need to be confident that businesses which ignore their responsibilities will be held to account for breaches of product safety.

The UK enjoys a robust legal framework to protect consumers, and the Government are committed to maintaining and building on that. Indeed, we have taken decisive action to enhance the effective functioning of the product safety system. We launched the Office for Product Safety and Standards last year to enhance the UK’s product safety system and to provide strategic leadership and co-ordination of the system, taking a lead in response to national product safety incidents. The OPSS works closely with local trading standards teams to support them in tackling local issues.

Photo of Yvonne Fovargue Yvonne Fovargue Labour, Makerfield

Does not the Minister agree that the cuts to local trading standards departments, which have seen them lose about 56% of their staff, have severely hampered their work in keeping the public safe?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

The hon. Lady is right about the role of trading standards and the pressures under which departments operate. The local priorities of local trading standards will always differ across the country. The beauty of the OPSS is that it takes a strategic role, which enables it to support local and national trading standards in dealing with nationwide issues. It also provides expertise and financial support for testing functions, when required.

We launched the OPSS last year to enhance the system. We work closely with local trading standards departments to support them in their work and in tackling local issues. The aim of this order is to strengthen the ability of the OPSS to carry out its role in leading the response to national product safety incidents and cases and in ensuring the cohesion of the product safety system.

The order does three things. First, it will enable the Secretary of State, and the OPSS on his behalf, to investigate potential safety issues related to consumer products regulated by the provisions of the General Product Safety Regulations 2005, using the investigatory powers listed in schedule 5 to the Consumer Rights Act 2015. Secondly, the order will enable enforcement authorities in the UK, including local trading standards, district councils in Northern Ireland and the Secretary of State, to use those same investigatory powers to investigate claims about gas appliances and personal protective equipment. Finally, the order makes a minor amendment to the Measuring Instruments Regulations 2016 and to the related reference in paragraph 10 of schedule 5 to the 2015 Act to correct a typographical error.

Potential safety issues relating to consumer products covered solely by the General Product Safety Regulations can already be investigated by enforcement authorities using the powers under schedule 5 to the 2015 Act. Such issues are generally investigated by local trading standards in the UK and by district councils in Northern Ireland in the local area where the incident has occurred. The order will enable the Office for Product Safety and Standards, on behalf of the Secretary of State, to investigate claims of unsafe products in the context of national incidents or cases, providing equivalent investigatory powers to those available to local trading standards and other relevant enforcement authorities. This means that the OPSS can provide the leadership and action needed to deal with national incidents and cases.

The order will provide the full range of powers contained in schedule 5 to the 2015 Act, which includes powers to require the production and potential seizure of documents, the inspection and purchase of products, the testing of equipment and the seizure and retention of goods. These are essential aspects of undertaking effective checks and actions in relation to unsafe goods. It is vital that our new national regulator has these powers across the broad spectrum of consumer products, which will enable it to provide leadership on cases and incidents of national importance.

The Secretary of State, and the Office for Product Safety and Standards on his behalf, may already exercise these powers in relation to the enforcement of sector-specific regulations such as on electrical equipment, lifts and so on. The Government want to ensure that the Secretary of State can lead across the wide range of consumer products, not just those that fall under sector-specific regulations. The order therefore allows the Secretary of State to investigate any type of product covered solely by the General Product Safety Regulations, should the need arise.

The order’s second purpose is to make sure that the Secretary of State, local trading standards in Great Britain and district councils in Northern Ireland can investigate safety issues concerning gas appliances and personal protective equipment. New regulations were introduced last year under the negative procedure, and this order now provides for the amendment of the 2015 Act by the affirmative procedure. It also enables enforcement authorities to use the investigatory powers in schedule 5 to the 2015 Act in relation to products covered by the 2018 regulations.

Finally, the intention underpinning the enforcement of the Measuring Instruments Regulations has always been that the enforcement authorities should have access to the investigatory powers in schedule 5 to the 2015 Act. This order corrects a typographical error in the relevant provision in both the regulations and schedule 5.

The order will provide the ability for the OPSS to lead and co-ordinate responses to national product safety cases and incidents, enhancing protection for UK consumers. It improves the Secretary of State’s ability to investigate claims of unsafe consumer products, and it helps to prevent injury and loss of life.

Photo of David Drew David Drew Shadow Minister (Environment, Food and Rural Affairs)

The Minister probably knows what I am going to say about school notice boards. She and her colleagues have been very helpful. Could she confirm that the order will make it quicker and easier to look at such products, which at least need investigation?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

I thank the hon. Gentleman for his intervention. I note his passion for the safety of notice boards in schools. He is correct. The essence of the order is that the Office for Product Safety and Standards will be able to act quickly and effectively in investigating and in using the full range of powers open to us to make sure we take the necessary action to protect consumers.

Enhancing protection for UK consumers is at the heart of my Department’s priorities, and the order improves the Secretary of State’s ability to investigate claims about unsafe consumer products and helps to prevent injury and loss of life. The order gives greater protection to law-abiding businesses, as it helps to stop unfair competition by preventing the placing of unsafe products on the UK market, and it makes sure that, where there is a national product safety incident, the Secretary of State can provide the necessary support and leadership to investigate.

The order enables the Secretary of State, local trading standards and district councils to investigate the safety of gas appliances and personal protective equipment regulated by the 2018 regulations. It is a further step in making sure that the Office for Product Safety and Standards can fulfil its regulatory role in the area of product safety, and it is a further step in the Government’s commitment to protecting consumers and maintaining fair markets for law-abiding businesses.

Photo of Gill Furniss Gill Furniss Shadow Minister (Business, Energy and Industrial Strategy) (Steel, Postal Affairs and Consumer Protection) 2:17 pm, 11th June 2019

UK consumers spend over £1,160 billion a year on goods and services, and they are the backbone of the British economy. They spend their hard-earned money in shops and, increasingly, online. It is vital they are properly protected when buying products to ensure consumer safety.

The majority of law enforcement—75% of public enforcement responsibilities—is carried out by local authority trading standards services, from scams to products. However, those services have had to deal with cuts of more than 50% over the past seven years, and some parts of the country have been hit particularly hard. These cuts will undoubtedly have a negative impact on their ability properly to inform and enforce consumer protection.

Sadly, lack of compliance with consumer protection law can have serious and deadly consequences. For example, around 3,000 fires each year in the UK are caused by faulty electrical appliances. This technical order

“establishes equivalency with respect to the investigatory powers in Schedule 5 to the Act between the Secretary of State and those of local authority Trading Standards and district councils in Northern Ireland”.

The explanatory memorandum goes on to say:

“The instrument allows the Office for Product Safety and Standards, on behalf of the Secretary of State, to investigate claims of unsafe products in the context of a national incident, where local authority Trading Standards…lack the resources or expertise to do so.”

I broadly welcome this statutory instrument, in that it attempts to strengthen the enforcement regime. However, there are some points to note.

According to the National Audit Office, overall, local trading standards have lost 56% of their full-time equivalent staff since 2009, and 20 services in England have had funding cut by over 60% since 2011. Some services now have only one qualified officer. Despite that lack of funding, local trading standards teams are expected to enforce 263 different pieces of legislation for different Government Departments, with little direction from Government on the priority of those issues. It is this Government who have taken away the vital ability of trading standards to properly enforce consumer protection.

The OPSS was finally established after years of reviews and consultations, but unfortunately it has proved to be weak. It launched an investigation into Whirlpool following reports that more than 100 Creda, Hotpoint, Indesit, Proline and Swan tumble dryer models—all brands owned by Whirlpool—made between April 2004 and October 2015 could pose a fire risk. It is known that at least 750 fires have been reported since 2004 that involved those dryers.

Following its investigation, the OPSS assessed Whirlpool’s tumble dryer modification programme, and judged that the risk to consumers from modified machines is low. Consumer groups led by Which? were incensed by what they called a

“fundamentally flawed” investigation

“that appears to favour business interests over people’s safety.”

The investigation failed to speak with any affected Whirlpool customers as part of the review, and further failed to verify the history of the 28 Whirlpool dryers it tested as part of the inquiry, so it was unable to draw conclusions about when the machines had been modified and by whom.

How does the Minister suggest we have confidence in the OPSS if its first ever investigation has been so widely criticised for its failure properly to tackle the issues at hand? It is one thing to give it investigatory power, but another for the OPSS sufficiently to use those powers to investigate big business and hold it to account for its handling of such serious issues.

In so far as the use and scope of the investigatory powers is concerned, the note outlines that,

“it is envisaged that the investigatory powers will not be used frequently...However, when these occur the Office will be able to support and supplement the work of local authority Trading Standards more effectively than at present”.

Can the Minister outline what criteria will be set and will have to be met for OPSS and the Secretary of State to use these powers? Can she outline the process used to decide whether and when these powers will be used? Can she outline the process that will take—will any investigation undertaken by the OPSS then invalidate a local trading standards investigation? Will the two co-operate or will they be able to undertake any investigations in parallel? Finally, what discussions has the Minister had with trading standards about the use of these powers?

In conclusion, I draw the Minister’s attention to the fact that, yet again, an SI has been prepared without an accompanying impact assessment, and ask why that is.

Photo of Peter Bottomley Peter Bottomley Conservative, Worthing West 2:23 pm, 11th June 2019

I welcome the way in which the Minister has put this to the House. I would be interested in the responses to the questions raised by Gill Furniss, the Opposition Front-Bench spokesperson.

I have had two serious interests in consumer protection, which may or may not be partially affected by this regulation. The first was in residential leasehold, when Tchenguiz interests—although I am not terribly concerned about which they were—forced large numbers of lease- holders to change their call systems. There were rigged bids for replacing them, and when eventually the authorities began to take account of what was happening, the subsidiary Cirrus, which did nearly all the work, having won nearly all the bids, reported itself, saying that it was involved in a cartel. The others were minnows. The others got punished, and the Tchenguiz interests, through Peverel and Cirrus, got off scot-free.

I would like to know from the Minister, perhaps in writing after this debate, whether that is the kind of thing that could be picked up by these regulations, if reported by, for example, the campaigning charity Leasehold Knowledge Partnership, or whether there is some other way in which the Serious Fraud Office, trading standards and others could come in and protect these people. There are no current legal proceedings, so there is no particular problem, and the Minister may want to get her Department to consult other Departments about what they were doing when they were first alerted to these problems.

Secondly, I advise the Government to try to make sure that all those involved take account of the serious issues that are justified, but do not spend too much time chasing ones that are not. Many years ago, when I was Minister for roads, painting white lines down the middle of our national highways—quite a dangerous position to be in—our Consumers Association, Which?, followed up something from the Consumer Union in the United States, which wrongly took against a small four-wheel-drive car called the Suzuki Jimny or Samurai or 410; the suggestion was that it was the most dangerous vehicle on the roads, which should be banned. It was clearly not more dangerous than motor cycles. It turned out that it was not even the most dangerous in terms of stability. Nevertheless, for a year I had to fight off those who were arguing for a ban.

The point of telling this story to the Minister is that I hope the Government will take some account of science, that they will take some account of whether complaints are justified, and that where complaints are justified and consumers are at risk they will take action, but where they are not they will pass the matter back and say, “Try again some other time. We are interested in what works—is it necessary, is it right and will it work?”

Photo of Patricia Gibson Patricia Gibson Shadow SNP Spokesperson (Consumer Affairs) 2:26 pm, 11th June 2019

This statutory instrument is not particularly controversial. Strengthening the law to protect consumers is always a good thing, particularly in product safety.

I remember participating in a few debates about the need for and the purpose of an office for product safety, which has now been set up, with the task of making regulation work, so that it protects people and enables businesses to understand their obligations. The need for that was particularly brought home to us following the dangers posed to consumers by the faulty Whirlpool tumble dryers, and the faulty Hotpoint fridge that apparently led to the Grenfell tragedy.

The need for greater scrutiny of product safety has required much sharper focus since the start of the UK’s preparations for departure from the EU, as Brexit raises a huge question mark over the future of the domestic product safety regime. In addition, there is no denying the uncertainty and costs for businesses as they try to plan ahead. We all share concerns that there could be genuine risks for consumers that the levels of product safety enjoyed as an EU member may well be under threat.

The provisions of the statutory instrument to give greater powers to the Secretary of State, under the auspices of the OPSS, to investigate claims about unsafe consumer products in the context of a national incident, are very important, as are those that would require the OPSS to work more closely with trading standards, offering additional protection to consumers alongside current arrangements.

The aim here, that an effective enforcement regime requires the UK to arrange and ensure that the relevant enforcement agencies have and use the necessary powers to take appropriate measures on product safety, is laudable. However, I would impress upon the Minister that in the wider context of product safety a poor deal or no deal from the EU has the potential to put our product safety system in real jeopardy. I wonder, given the strengthening of the OPSS’s role, what additional funding it will be allocated to fulfil its role properly. Given that it will work more closely with trading standards than at present, will that mean additional funding for trading standards across the UK, given that they are already extremely hard-pressed in the face of evolving and creative threats to consumers and their safety? Can the Minister guarantee that the necessary funding for the OPSS, which will be required to carry out its new responsibilities, will be forthcoming?

What preparation has the OPSS done to ensure that it is indeed ready to assume the increased responsibility? We can all agree that consumer safety matters, but we also know that regulating it and monitoring it must be properly paid for, so I would be interested to hear what responses the Minister has to that.

I end by commending to the Minister the Scottish Government’s new consumer protection Bill, and the new Consumer Scotland body, which will champion consumer rights and protections, which she may wish to examine to see what can be learned from Scotland—as I am sure the Scottish Government will examine with interest the provisions before the House today.

Photo of Sharon Hodgson Sharon Hodgson Shadow Minister (Public Health) 2:29 pm, 11th June 2019

I am going to speak about something slightly different, which is what I think should be in the statutory instrument. As Members probably know—if they do not, it is probably because I have not banged on about it enough—I chair the all-party group on ticket abuse, in which capacity I wish to speak today. I feel strongly that with this SI the Government have missed a great opportunity to address some concerns that have been expressed to me over the years.

The Consumer Rights Act 2015 refers explicitly to secondary ticketing. Despite that important legislation, fans continue to be ripped off by secondary ticket touts who sell tickets for huge profits to genuine fans. Some touts do this regardless of whether the ticket actually exists, and without any regard for existing legislation. This leaves people out of pocket, frustrated, disappointed and unable to attend an event that they have saved for and looked forward to. The 2015 Act exists to protect consumers, which is what we are discussing, but it is failing to do so because of insufficient enforcement. Without sufficient enforcement, it becomes a moot Act, if there can be such a thing. That is why I wish to make the case today for more funding for our enforcement agencies, as I believe that enforcement is a significant aspect of the 2015 Act that is missing from this SI. I hope the Government will consider rectifying that.

National trading standards

“delivers national and regional consumer protection enforcement…Its purpose is to protect consumers and safeguard legitimate businesses by tackling serious national and regional consumer protection issues and organised criminality and by providing a ‘safety net’ to limit unsafe consumer goods entering the UK”.

To perform this huge task, the Department for Business, Energy and Industrial Strategy provides national trading standards and Trading Standards Scotland with just £14 million. With that small amount of funding, trading standards is expected to protect consumers from scams and cyber-crime and to protect UK borders and public safety. Does the Minister agree that £14 million per year for this huge responsibility, which requires investigation, prevention, safeguarding and enforcement, is really not enough to fulfil the task to any acceptable level, and that it must—I know it does—leave NTS officers continually frustrated and overworked? Has the Minister made any assessment of how much funding NTS needs to fulfil its role to the highest standard?

The 2015 Act makes it clear that sellers must provide seat, row and block numbers, as well as the unique ticket ID number, if the event organisers insist on it, yet there are still examples of secondary ticketing sites that do not supply this information. Touts are therefore still able to operate illegally and rip off genuine fans without any serious implications. The legislation exists—we are talking about it—but despite a long-running Competition and Markets Authority investigation, enforcement is still lacking. That means it is up to organisers, venues and promoters to monitor secondary ticket touts, cancel tickets when necessary, and respond to disappointed fans who are denied access with invalid tickets. Such expectations are unreasonable for organisers, venues and promoters. At a recent meeting of the all-party group, an event organiser said:

“We don’t want to be the enforcers, but if agencies aren’t there then we have to step in.”

Does the Minister agree that this is not an acceptable expectation for organisers, venues and promoters?

As the House knows, I have been working on this issue for a long time now, and I am convinced that ticket touts will continue to operate outside the law until there is a sustainably funded agency to ensure that the existing legislation—this legislation—is enforced. That is why the SI is deficient. Recently, we saw two English teams fly to Madrid for the champions league final. I have to admit that I am not a fan of either team—I do not know whether you are, Madam Deputy Speaker—but many fans flew over, too, paying out for their flights, transfers and accommodation, on top of as much as £5,000 per ticket, going up in some cases to £10,000 per ticket, only to be told, just hours before the game, that the tickets they had purchased from secondary ticket sites did not exist and were cancelled. I can only imagine the sheer disappointment, anger and frustration that those fans went through, even though the 2015 Act should have made it impossible for that to happen. Unfortunately, this is not a rare occurrence: it is something I hear about all too often from the excellent campaign groups Victim of Viagogo and the FanFair Alliance.

If the Government want to protect consumers—which is what we are here to do—they must invest in our enforcement agencies to ensure that the existing legislation is totally adhered to. I know that what I have talked about is slightly outwith the scope of the SI, and I am so grateful for the House’s indulgence and to you, Madam Deputy Speaker, for allowing me to talk about the funding of national trading standards, but I hope the Minister has heard what I have had to say, even though I have sneaked it in as I have done, and will look into the issue as soon as possible.

Photo of Rosie Winterton Rosie Winterton Deputy Speaker (Second Deputy Chairman of Ways and Means)

Before I call the Minister, I should say that I allowed the hon. Lady some leeway and she has put her views on the record, but I expect the Minister to address what is in the statutory instrument, rather than what is not.

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy) 2:36 pm, 11th June 2019

I welcome the contributions from all Members, because we all care about consumer safety and it definitely lies at the heart of what I have been doing in my time at the Department. I wish to comment on some of the points made and answer some of the questions that were posed.

First, I respect Gill Furniss and her thoughts on Whirlpool, but I did inform the House in oral questions this morning—I do not know whether she heard—that the Government have notified Whirlpool of their intention to issue a recall notice, which is part of the regulatory process. Although I have much respect for the hon. Lady, I totally disagree with her characterisation of the Government’s view on taking forward the concerns relating to Whirlpool and of the Office for Product Safety and Standards’s role in that process.

Photo of Yvonne Fovargue Yvonne Fovargue Labour, Makerfield

There are still millions of people who have not contacted Whirlpool and about whom Whirlpool knows nothing, so does the Minister not agree that the recall process would have been so much easier had there been at the time of sale a central register that could be used only in the event of a recall of dangerous white goods?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

The hon lady raises an important point. The process we have followed has meant that the Office for Product Safety and Standards carried out a review. We obviously want to move on to the next stage, and this is a great example of what the Office for Product Safety and Standards is able to do. The statutory instrument describes a specific element of that, mainly relating to the investigatory powers. We are doing further work on consumer protection as we bring together—we hope, in the near future—a consumer White Paper on strengthening enforcement and a host of other things, on the back of the Green Paper that was announced last year.

On the Secretary of State’s powers to investigate, local trading standards in Great Britain and district councils investigate claims about potentially unsafe products in their local areas. National incidents are designated under the Office for Product Safety and Standards’s national incident management plan triage process. We want the OPSS to lead on national incidents and to have the same investigatory powers as local trading standards. The Secretary of State already has equivalent investigatory powers to investigate any products regulated under specific legislation, such as cosmetics and electrical equipment, but not cots and DIY tools. This order aligns the Secretary of State’s powers with those that are already available to trading standards and ensures the consistency of the powers that could be used by the OPSS. The circumstances under which the Secretary of State would exercise those powers is where the OPSS’s national incident management plan triage process concludes that the nature of the product warrants such action.

With regard to the OPSS and its communication with our trading standards, I have to tell the House that the relationship between national trading standards, local trading standards and the OPSS is one of continuous communication and working together. We would not be able to influence and to have such a great enforcement system without those organisations working together. Yesterday, I met trading standards professionals across the enforcement landscape. A key part of my role has been making sure that I keep in touch with representatives of national and local trading standards. I wish to put it on record that trading standards officers do invaluable and exceptional work throughout the country. They work incredibly hard and are very much the unsung heroes.

Photo of Sharon Hodgson Sharon Hodgson Shadow Minister (Public Health)

I agree with the Minister on that point, but I want to highlight the points that I was making about the funding of national trading standards. [Interruption.] She has just assured me that she is coming on to that point.

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

The Government took a great step when they formed the OPSS in January 2018. The OPSS was given additional funding of £12 million a year to build national capacity for product safety. The expertise—the scientific-based research— that it will be able to undertake will aid and assist local trading standards in carrying out their own functions. This is very much a working-together situation. We have committed £190,000 to behavioural insights to date and invested £498,000 on social science research. Over the next three years, £4 million will be spent on upgrading the scientific facilities in Teddington, and £750,000 of support has been provided in 2018-19 for testing and training trading standards, and there is another £500,000 funding for trading standards to carry out product safety testing, and that will increase next year. We have also trained more than 250 trading standards authorities, which included training 800 people. Such training enables local trading standards to have free access to the technical British standards, which really equips them and supports them in identifying compliance issues.

Let me move on now to the issues raised by Patricia Gibson. She was very concerned about funding, and as I have tried to outline, the OPSS will take a strategic role in supporting local trading standards. The statutory instrument ensures that we have a clear enforcement strategy, which gives the OPSS and the Secretary of State the powers that they need.

Photo of Patricia Gibson Patricia Gibson Shadow SNP Spokesperson (Consumer Affairs)

Forgive me if the Minister has said this already and I have missed it, but given that the powers of the OPSS are to be strengthened, will there be an increase in personnel to support trading standards, and will the OPSS itself receive additional money—apart from the £12 million that it received when it was set up?

Photo of Kelly Tolhurst Kelly Tolhurst Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy)

The OPSS is ready. It is taking on not extra work, but an extra power, which it is quite ready to take on. I have already outlined what it has done in the case of Whirlpool.

I understand the concerns of Mrs Hodgson, and she is a great campaigner in this area. She will know that work is ongoing with regard to secondary ticketing. That matter is not related to this SI, but I am more than happy to speak with her directly outside the Chamber to give her some more assurances if that is what she wants.

I almost forgot the contribution of my hon. Friend Sir Peter Bottomley. I am grateful to him for raising those issues. We are looking at strengthening consumer protection, full stop. Perhaps we could meet. I have not spoken to him about this issue, but I am more than happy to meet him, so that we can investigate the matter further with the OPSS if necessary.

Without this order, we will not be maximising the potential of the new regulator. The British public would ultimately have less protection from unsafe and non-compliant products. Law-abiding businesses would have less protection in maintaining and growing their businesses and the UK economy, and that is not what this Government want. We are committed to making the UK product safety systems the best in the world, and ensuring that our regulators have the right tools to protect our people is a further step to achieving that goal Therefore, I commend this statutory instrument to the House.

Question put and agreed to.