Second Reading

Part of Consumer Rights Bill – in the House of Lords at 6:07 pm on 1st July 2014.

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Photo of Viscount Younger of Leckie Viscount Younger of Leckie The Parliamentary Under-Secretary of State for Business, Innovation and Skills 6:07 pm, 1st July 2014

My Lords, I believe that there is still time to get hearts racing. We have an excellent opportunity before us to ensure that we have the best possible legal framework to empower consumers, drive competition and encourage growth. I am therefore very grateful to noble Lords for their wide-ranging contributions to the debate today on this important Bill. I appreciate the general support for its core elements that have come from so many Peers: from my noble friends Lady Oppenheim-Barnes, Lord Clement- Jones, Lord Stoneham and Lord Borwick, from the noble Lords, Lord Wills and Lord Alton, and even from the noble Baroness, Lady Hayter, although that was before she read out a full list of issues that means that I have much ground to cover. I also pay tribute to my noble and learned friend Lord Howe and my noble friend Lady Oppenheim-Barnes for their long contribution to consumer issues over many years.

I shall pick up on the specific points that have been raised today. The noble Baroness, Lady Hayter, and my noble friend Lady Oppenheim-Barnes, as well as the noble Baroness, Lady Drake, and the noble Lord, Lord Stevenson, talked about the importance of consumers knowing what their new rights are. I agree with that. Empowering consumers is a key objective of the Bill, and we have set up a group of consumer and business organisations that is working with us to develop a strong implementation programme to ensure that consumers and businesses are well aware of consumer rights. The group is considering the role of consumer rights information at point of sale, a point that my noble friend Lord Stoneham raised. I undertake to write to noble Lords before Committee to provide an update.

My noble friends Lord Clement-Jones and Lady Heyhoe Flint and the noble Baroness, Lady Hayter, and the noble Lord, Lord Stevenson, raised the issue of regulating ticket sales. I sympathise with cases in which consumers are misled about the nature of what they are buying. We have seen many excellent examples of event organisers controlling how tickets move from the primary to the secondary market, some of which were discussed in the other place at length. That good practice needs to be extended where event organisers have concerns. I reassure noble Lords that legislation is in place to protect consumers. It is already an offence for a trader to mislead a consumer. It is also a requirement that the main characteristics of goods and services, as well as the name and address of the trader, must be given to a consumer before they buy. For ticketing, I stress that the main characteristics should include the seat number, if one exists.

The Government are committed to ensuring that the law is enforced. In 2013 alone, the Advertising Standards Authority looked at 130 websites to ensure that pricing was accurate and not misleading, and this year it is reviewing 650 more. In addition, further legislation will come into force in October to give consumers who are misled better access to compensation. Therefore we are tightening consumer protections. However, industry best practice also needs to be extended. My noble friend Lady Heyhoe Flint, at least, recognises that particular point.

I very much appreciate and agree with the sentiments expressed by the noble Baroness, Lady Hayter, and the noble Lords, Lord Wills and Lord Stevenson, on the important point about unsolicited nuisance calls—or as the noble Lord, Lord Wills, put it, marketing calls—which can cause inconvenience, stress and anxiety for many consumers, in particular the elderly and the housebound. I am sure that we are all only too aware of situations when we could do without having to answer such calls. A phone ringing when you are making supper is very distracting even when you know who is calling, but when the call is unwanted and of no interest then it can be an unacceptable intrusion. However, I firmly believe that banning unsolicited calls will not solve the problem.

That is not only my view but the view of the Culture, Media and Sport Select Committee. In its report of 5 December 2013, the committee said that a ban on cold calling should not be introduced because there were many legitimate reasons why such calls might be made, such as by the emergency services, medical practitioners, pharmacists, even elected politicians, charities, and companies with which the recipient has a genuine relationship. For example, in its report the committee says:

“The National Autistic Society told us that the telephone is ‘the single most successful way that—as a charity reliant on public donations—we raise money from individuals’. The Society’s evidence ends with an appeal: ‘Please do not curtail our use of this marketing channel—I would implore you to fully consider the implications for society before making any changes’”.

We also have the example of other jurisdictions as further evidence that a ban does not actually work in practice. For example, Germany has a system that prohibits direct marketing calls unless an individual positively opts in to receiving such calls. Yet according to a study undertaken by trueCall Ltd in 2011, the level of complaints about nuisance calls was found to be broadly similar to the UK.

Despite what the noble Baroness, Lady Hayter, says, we need to focus our efforts on catching those that break the law—I believe that she did say that—which is why the Government’s action plan, published in March, focuses very firmly on improving enforcement. For example, we will shortly be consulting on lowering the legal threshold to allow more enforcement action, including penalties, to be taken. I make the point that some action is taking place.

The noble Lord, Lord Wills, spoke about consultation —a point which was well made. As I said, we will shortly be consulting on lowering the legal threshold to allow more enforcement action, including penalties, to be taken. Only last week this House approved an order that enables Ofcom to disclose information to the Information Commissioner’s Office about organisations that break the rules.