Lord Bishop of Truro
Main Page: Lord Bishop of Truro (Bishops - Bishops)Consumer Rights Bill
Lord Bishop of Truro Excerpts
The Lord Bishop of Truro
My Lords, I support the amendment and am grateful to the noble Baroness for providing a comprehensive and excellent introduction to it. I do not want to repeat the important points that have already been made; I simply want to underline one particularly important point.
These days, we all have a responsibility to take child protection and safeguarding very seriously. Your Lordships may or may not be aware that you cannot be made a bishop in the Church of England unless you have had statutory safeguarding training. The most reverend Primate the Archbishop of Canterbury has made that very clear in all that he has said and done, and that seems absolutely right and proper.
It strikes me that, of all areas, this is one where we should do all that we can to protect our children. I sometimes worry about the matters that we are not worrying about now. I fear that in 20 years’ time we will look back and say, “Why on earth didn’t we do something about this?”. I often think back to the days when I would have got in a car and not been bothered that I was not wearing a safety belt. It strikes me that this is an issue that we can take seriously. We are of course dealing with the Consumer Rights Bill and I am concerned that we spend a lot of time worrying about rights but do not think about responsibilities. We have a responsibility to care for and protect our children.
I declare an interest as chairman of the Children’s Society. At every board meeting, we have a representative number of children and young people. I can tell your Lordships that at every single meeting those young people teach me something about the internet and the world wide web which I did not have a clue about. They are far savvier than I will ever be and allegedly I am not as old as some of my colleagues.
Therefore, I very much support the amendment and I stress that we have responsibilities as well as rights. The word “safeguarding” and the fact that we take child protection very seriously do not undermine in any way the important points that have been made. The imbalance between what happens offline and online seems quite extraordinary. Surely this is an area where we should have legislation that regulates and protects all children.
“High-cost short-term credit: unsolicited marketing
The Secretary of State must make regulations to prevent the sale of high-cost short-term credit through unsolicited marketing calls.”
The Lord Bishop of Truro
My Lords, Amendment 105C is in my name and those of the noble Lord, Lord Mitchell, and the noble Baroness, Lady Bakewell. I declare an interest: I am chair of the trustees of the Children’s Society, which has co-ordinated this amendment as part of its campaign—of which I am very proud—on the impact of debt on children and families. We produced a report entitled The Debt Trap earlier this year.
In September this year, the Children’s Society launched another report, entitled Playday not Payday, which looked at the effects of the advertising of payday loans on children, and in particular at the telemarketing of payday loans. The report identified a gap in the regulations which allows payday loan companies to use unsolicited marketing calls to offer people payday loans through phone calls and texts. For mortgage products, this type of unsolicited marketing is completely banned by the Mortgage Conduct of Business rules. The Financial Conduct Authority, which regulates payday lenders, said:
“Cold calling can expose consumers to high pressure sales tactics which mean they can end up with an inappropriate or over-expensive product or service. Our investment and mortgage financial promotion rules therefore ban cold calling … unless certain conditions are met”.
Why, therefore, does the Minister feel that this ban should apply only to mortgages and not to other forms of credit such as payday loans? According to a poll by the charity StepChange, a third of its clients have received an unsolicited marketing call offering them a payday loan. The average client said that they received an average of 10 calls per week. Calls at that frequency, if aimed at certain vulnerable parents and families, can have a detrimental effect on a person’s mental health and well-being.
The Children’s Society found that of those parents who had never taken out a loan, only 7% said that they were receiving calls from payday loan companies more than once a day. That increased to 42% for parents who had previously taken out a payday loan. Given that we know that young parents are more likely to take out a payday loan, I share the society’s concern that this suggests that young parents who are already in financial difficulty are receiving the brunt of those calls. Anecdotally, we hear stories of payday loan companies sending “I miss you” texts to parents who have not taken out a loan after a period of time. I am sure that the Minister agrees with me that that kind of behaviour is unacceptable.
I understand that the Department for Culture, Media and Sport has recently launched its long-awaited consultation on nuisance calls, which will also cover unsolicited telemarketing calls. The proposal to make it easier to prosecute and fine firms that break the nuisance calls rules is of course welcome and will in the long term help reduce the number of unsolicited payday loan marketing calls. However, I am concerned that this does not go far enough to protect consumers. An outright ban, similar to that applied to mortgage products, would almost guarantee protection for vulnerable families from harassing and persistent calls from payday loan firms. Will the Minister commit to looking at this issue ahead of Report to consider using the Bill to further protect vulnerable families?
Lord Deben (Con)
My Lords, I support this amendment. It is true that we have already complained about this constant nuisance. However, it is particularly true that many parents of vulnerable children are not at work, and therefore are present when the phone rings on a constant basis to offer people money in this way. It is intolerable, and an insult to family life. I do not understand why we have taken so long to deal with the overall nuisance, which most of us recognise in our own homes and our own places.
On those occasions on which we happen to be at home during the week, there is no doubt that the telephone rings on a regular basis to offer us all kinds of services, none of which we may want. There is no way of stopping them—in particular that annoying habit of a machine talking to you, so you do not even have the chance to be unfairly rude to the person who has rung you up. I try to be polite to the real people at the other end, because it is not their fault—that is the job they were given. However, it is extremely difficult, because this is an intrusion which modern life has not applied itself to. Why should we have the disadvantages of the telephone without doing something to compensate for them?
In general, this is a scandal, and in general it is fair to say that Governments of both parties have been very slow to deal with it. However, in particular what the right reverend Prelate has brought forward is a crucially important problem. Once a family has taken out a payday loan and has paid it off, they are very vulnerable to a repeat performance. These people go on and on at them, and the children are very much affected by that. It is one of those habits that people have to get out of. If they are trying to get out of it, the telephone call is intended to bring them back within the thraldom of the payday loan.
We should be much tougher about payday loans, right across the board. We should be doing a lot more to encourage the provision of the much more respectable and sensible means of people taking small loans and being able to pay them back in proper ways. Credit unions, and the extension of those credit unions, are very important. That is the positive side, but the negative side is that we have to take this seriously. I have tried very hard but I cannot for the life of me think of any logical reason for opposing these amendments.
I hope that my noble friend will not put forward the argument that we are consulting on something else. I have been in politics and in Parliament for 40 years, and I do not believe that argument. It is always used by civil servants who do not want their Minister to listen to the argument; they want them to put it off. Therefore, I hope that my noble friend will not raise that point. If she is able to find another point, I shall be thrilled, because I have not been able to find one myself. If she is either unable to find another point or unwilling to raise the usual answer, perhaps she will be kind enough to say yes to the right reverend Prelate.
Baroness Neville-Rolfe
Perhaps I could try harder; we will have to return to it if I cannot persuade the noble Baroness. The difficulty is that if, for example, someone rings up a domestic violence helpline and that number is public, it will then appear on the bill, so other members of the household will then know that people in their household have been ringing that number. This sounds like a detailed issue, although I think that our hearts are in the same place. My understanding is that this was debated at great length in Brussels at the time of this directive, and that these were the problems that came up. I thought that it was right to share that background with the Committee. I will go away to see whether the point that the noble Baroness has made about individual versus corporate stands; I think it is a legal point that I would need to take advice on. That is the difficulty; it was a combination of behavioural and legal points that reflected the concerns the EU had when it was talking about this, when obviously it was trying to do the right thing.
I turn to Amendment 105C. The Government share the concern of the right reverend Prelate and the Children’s Society about payday lenders using unsolicited calls to market inappropriate products to vulnerable consumers. Indeed, we had a long debate earlier in this Committee on the whole issue of payday loans. Such practices must not be allowed to occur, as the noble Lord, Lord Deben, said. I reiterate that the tough measures that I outlined as part of the nuisance calls action plan will capture the practices of payday firms, among other industries. Such firms will no longer be able to target consumers as they have previously been able to.
The right reverend Prelate asked why, as mortgage calls were banned, payday lenders’ calls could not be banned. I am afraid I must take that question away; I was not aware of the ban on mortgage calls, and I will investigate and write to the right reverend Prelate to see if that provides some new avenue into the debate.
To conclude, the Government take the issue of nuisance calls very seriously, and I have set out a number of ways in which we are tackling the problem and the way in which we have speeded up. The Government will continue to work with consumer groups, regulators and of course industry, which need to make changes to find effective solutions. The work outlined in our action plan is under way—new things are happening all the time—and this will help to contribute towards achieving more long-term solutions to deal with nuisance calls. I have outlined a couple of points of follow-up, which we will pursue before we get to the next stage of the Bill, but in the mean time, I ask the right reverend Prelate to withdraw his amendment.
The Lord Bishop of Truro
I am grateful to the Minister for her response, and I thank all noble Lords who took part in the debate. Clearly, unsolicited calls struck a nerve with most noble Lords here. It was therefore ironic that we should have our own version of an unsolicited call when the Division Bell rang to empty this Room.
By way of response, I thank the Minister very much for the offer of a letter on the point about mortgages, which, as was reinforced in the debate, is a significant issue. I will stress and underline a point on my amendment. I understand entirely the strength of feeling in the Room about the way in which we are affected by unsolicited calls, but I want noble Lords to imagine what it must be like if you are leading a chaotic life in a vulnerable situation, where bizarrely, the phone ringing might be seen as a good thing rather than a bad thing—as many of us would see it. In view of some of the amendments we will come to later, there is almost an addictive quality. Some of these payday loan firms will buy into and hook into these people, who do not have the resilience to resist in the way that I suspect we can. We can joke about it. It might be a nuisance for us—we might be able to shout down the phone at a machine—but for some of the people that we represent in the Children’s Society those strategies are just not available. This is therefore very important. I am grateful to the Minister for her assurance of a letter, and I beg leave to withdraw the amendment.