Public Bodies Bill [HL]

Baroness Hayter of Kentish Town Excerpts

Tuesday 11th January 2011 Lords Chamber

Moved by

[Baroness Hayter of Kentish Town]

43: Schedule 1, page 17, line 7, leave out “National Consumer Council (“Consumer Focus”).”

[Baroness Hayter of Kentish Town]

My Lords, although I now have no involvement with Consumer Focus, I was on the National Consumer Council—something that I gather I share with the noble Baroness, Lady Wilcox—before its merger with Energywatch and Postwatch. The merger in 2008 that created Consumer Focus, under the Consumers, Estate Agents and Redress Act 2007, was the result of extensive parliamentary debate. The merger was carefully designed—including here in this House—and was implemented with good planning as well as wholehearted and widespread support. The merger has created a highly successful independent champion for all consumers across England, Wales and Scotland and for postal services consumers in Northern Ireland. Consumer Focus has specific responsibilities for energy and postal services users—and, from next year, for water users in Scotland—and is admired around the world as the leading voice for consumers.

I have a number of fears about the Government’s intention to abolish Consumer Focus and to pass its work to Citizens Advice. My concerns centre partly on the very different roles of Consumer Focus and Citizens Advice and partly on the duties that Parliament gave to Consumer Focus. I also have concerns about the impact on devolution, on consumer affairs and on accountability as well as on the capacity of Citizens Advice. There is also a fundamental concern about the undermining of consumer protection. Consumer Focus is not an advice or complaint-handling body but a policy and advocacy voice across the whole of consumer affairs with a record in industry-wide investigations and achievements. I have real concern about how Consumer Focus’s work on behalf of consumers—the least represented group in our economy compared with unions or business—will be maintained.

Let me start by taking the example of a current consumer topic—this may sound an unusual issue—which is the volume by which bread and beer may be sold. Over the Christmas Recess, David Willetts, the Minister in the other House, started his new year by suggesting the abolition of the regulations that provide the 400-gram rule for the sale of bread and that require beer to be sold in pints and wine to be sold in specified measures. I emphasise that the National Consumer Council and Consumer Focus have never been pro regulation for the sake of it. Indeed, Consumer Focus has often championed and helped to obtain deregulation, for example, over dispensing opticians and over the numbers of licensed hackney cabs. However, it seems to me that in any such discussions on the issue of how bread is sold or whether beer should be sold only in pints, it is absolutely right that the voice of the consumer is heard.

On such matters, producers will have their own view, whether that is about the profit that they can make or the freedom to innovate—which probably means selling smaller loaves. Government will have a view on whether, in the case of beer and whisky, a proposed change could affect the tax take, or, in the case of bread, on the cost of monitoring compliance. Regulators will have a view on competition and whether rules ease or hamper new entrants. However, where is the voice of the consumer without Consumer Focus? An experienced trading standards officer wrote to me when he heard about the possibility of bread quantities being changed and all those safeguards going. He said that he could not imagine that any well informed consumer would call for those changes. I do not know whether he is right or wrong, but I know that there needs to be a body that will obtain the views of consumers and reflect those in the debate.

Citizens Advice is much more focused on providing advice and guidance to individuals who come through the doors of citizens advice bureaux. Theirs is not the role of looking at market structures and at future regulation, in which Consumer Focus—independent of Government and with a specific consumer interest—is so expert.

Bread is just one current issue that requires what Consumer Focus can contribute to our national life, but another historic example is that of ombudsmen. Consumer Focus—then the National Consumer Council, which was possibly even chaired at the time by the noble Baroness, Lady Wilcox—made one of its most significant achievements for consumers by its original support for the concept of ombudsmen, which we all now take for granted. The National Consumer Council saw not only how consumers, once they knew that they could get their complaints heard and assessed independently, would have more confidence in the product or service but how businesses could learn from good systems of complaint handling and how regulators or the press could judge industries or individual suppliers from such intelligence. The ombudsman system has been copied worldwide, but the credit for this forward-looking advance for consumers must lie with the NCC as was. We risk losing that service to consumers by placing the policy function within an organisation whose local funding is seriously stretched and whose core function is to help those who come through its doors rather than to plan systems for decades ahead.

--- Later in debate ---

[Baroness Wilcox]

My Lords, late though the hour is, that is a very good question. The consultation that we will have will take on board everything that has been raised tonight and is raised by people taking part in the consultation. Obviously, if we intend doing something as changing as this, everything will be considered. It would be foolish indeed if we just allowed everything to close. We must remember that Citizens Advice back at base is where so much of the work will be done. People will be able to contact Citizens Advice online, but I agree that the high street is where Citizens Advice as majored and I am sure that we will do all we can to make sure that that visible presence does not get reduced.

It is perhaps worth saying that the consultation will happen in the spring, which of course is within the next few weeks. We propose to make any changes in the consumer landscape by April 2013, so we have plenty of time to get this right and to see exactly what is happening out there and what we are creating.

[Baroness Hayter of Kentish Town]

My Lords, I thank the speakers, who have been impressive, if not overwhelming, for me today. They include a former director-general of OFT, three—including the intervention —former chairs of the NCC and a former Minister in this area. It shows the degree of concern about how consumers within civil society can have their voices heard in decision-making, whether that be in the public sector through industry, by regulators or by elsewhere. It seems to me that this is a key area.

The original purpose of the Government was to reduce the number and cost of quangos—hence its so-called review. We hear that the consultation will be early this year or in springtime. It is at least something that that review has taken place. The House of Commons Public Administration Select Committee in its report thought that the review to date was poorly managed. I fear that even the Minister’s answers have substantiated that. I am delighted to hear her say that the Government will look at, are looking at and are giving consideration. That is great. It is just rather sad that that has happened after the decision and after this Bill is before us rather than before.

There was precious little consultation with Scotland and none with Wales, none with the wider consumer movement or representatives of users or clients, or indeed anyone else. As my noble friend Lord Whitty said, the Bill does not provide for a transfer of functions—it is an abolition. My noble friend Lord Borrie did not ask who is going to provide help on the high street, important though that is, but put the vital question of who will do the high-quality research, investigatory and advocacy work across the whole economy that is being done by Consumer Focus and the NCC before that. I do not think the Minister has answered that question.

The proposal, according to my noble friend Lord Liddle, is anti-big society, and I think that is right because the big society should be about having the consumer voice at the heart of every decision that takes place. The reasons given for other bodies in the Bill is that they are old, a bit cranky and in need of an MOT, or even removal. That is not the case with Consumer Focus because it is two years old. Nevertheless, I agree very strongly with what the noble Baroness, Lady Deech, said. If this Bill had led to rationalisation and to better protection and advice, she would be with it. At the time when I was still with the NCC and we were discussing the mergers, we would have loved to have the water watchdog, Passenger Focus and others coming in so as to provide a really strong and dynamic voice for consumers. Had this led to such a rationalisation, I would not be here arguing against it—I would be cheering it on. We need consumers across all sectors to have a stronger voice, so if the desire expressed by the noble Baroness, Lady Deech, was to be met, I too would be with it.

As the noble Lord, Lord Maclennan, said, it is not a positive proposal for change; rather it is a winding-up process. I think he also agreed with the notion of “Rationalise, yes; abolish, no”. He said he did not think that the Bill would achieve the aims of better consumer protection and certainly is not going to save public money. The noble Lord fears that this marriage will not work. I think he may be right and that it may be a marriage made in hell. He also asked whether Citizens Advice could undertake the probing, analytical work that has been done. Citizens Advice is about solving individual problems, but we need a consumer voice that goes to Government, to industry and to services.

I am delighted that the Minister said that discussions and talks are now taking place. They may be late, but better late than never. I will also be delighted if Scotland and Wales have time to consider whether there is an alternative model that suits the devolved areas better. The Select Committee also said that the Government face the much larger challenge of successfully implementing these reforms. That is right because there are still questions about funding. I was sorry to hear the Minister use words like “efficiency” and “savings” in her discussion on funding when I had rather hoped to hear about a promise and, “Yes, that is fine”. I would have liked that better. There are still questions of accountability and about whether Citizens Advice is the right organisation to do this job. There is also the question of what happens if finally it says no.

I hope that the Government will continue in their thinking and do a proper consultation, even if it is being done a bit later than perhaps it could have been. But in order to assist them, of course I beg leave to withdraw the amendment.

Amendment 43 withdrawn.