Delivery Charges (Scotland)

Part of the debate – in Westminster Hall at 5:14 pm on 20th December 2017.

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Photo of Margot James Margot James Parliamentary Under-Secretary (Department for Business, Energy and Industrial Strategy) 5:14 pm, 20th December 2017

If the right hon. Gentleman will allow me, I will come on to what I propose to do before I close.

We already have legislation in place under the general Consumer Protection from Unfair Trading Regulations 2008 and the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, which apply to online purchases. They make it clear that information given by traders to consumers regarding delivery costs must be up front and transparent before a transaction is entered into. Any consumer who believes those rules are being breached should report it to trading standards through the Citizens Advice consumer service.

If misleading advertising about the cost of delivery is an issue, the Advertising Standards Authority, which has responsibility for ensuring compliance with the code of advertising sales, promotion and direct marketing, will act to ban or amend advertisements that have the potential to harm or mislead the public. Decisions on complaints are made public, and where necessary the ASA will report persistent offenders to trading standards for further enforcement action.

The Government’s view is that regulating prices, or intervening in how businesses and retailers establish their pricing structures, would not overall be in consumers’ best interests, because they are commercial matters. The market is highly competitive and innovative, with many different types of companies being selected by online retailers to provide delivery solutions. That has given rise to new ways of receiving packages, such as collecting them from more secure and more convenient locations and post offices.

The issues involve a three-way relationship between consumers, online retailers and delivery companies. As Members stated in the debate, the postal sector regulator, Ofcom, has just concluded a two-year study of parcel delivery surcharges that reflect the cost to operators and go beyond them. It found that some retailers apply a surcharge to consumers for delivery to certain locations, while others do not. It is therefore not clear that surcharges applied by parcel operators to online retailers are automatically passed on to consumers in all cases. The Government will consult Ofcom further on what might be done to improve competition. As highlighted by my hon. Friend the Member for Moray, the Consumer Protection Partnership, which brings together enforcement bodies and advice providers and is chaired by my Department, recognises that this is a priority that requires further work. It brings together a number of important bodies with an interest in this vexatious matter.

A number of Consumer Protection Partnership members, including Citizens Advice Scotland, the Consumer Council for Northern Ireland, the ASA and other enforcement bodies, along with Ofcom, are working together to undertake a review of parcel surcharging. That review is looking at the existing research, evidence and legislative framework, with the aim of improving compliance by online retailers with consumer protection law. It will also consider further proposals relating to concerns about the level and fairness of parcel surcharging, about which we have heard so much this afternoon.