Pension Schemes Bill [HL]

Debate between Lord Sharkey and Baroness Drake

Committee stage & Committee: 3rd sitting (Hansard) & Committee: 3rd sitting (Hansard): House of Lords
Monday 2nd March 2020 Grand Committee

[Lord Sharkey (LD)]

My Lords, my noble friend’s amendment, among other things, speaks about advertising. The underlying question about advertising, however, is surely why allow it at all? That was touched upon by the noble Lord, Lord Vaux, and the noble Baroness, Lady Altmann. You can see the benefit, obviously, to commercial dashboard providers: another revenue stream and/or the cross-selling of their products. However, it is hard to see why the customer would want yet another advertising channel while there are already thousands—perhaps tens of thousands—of advertising channels. What really is the benefit to the consumer; or perhaps more accurately, what really is the risk-benefit balance for the consumer created by the existence of advertising on commercial dashboards? What assessment have the Government made of this risk-benefit balance? If the answer is none, perhaps they should consider doing exactly that. I am curious about whether the Government have, in fact, indicated to potential commercial dashboard providers that they will be able to run ads on their dashboards. Is there some implicit quid pro quo going on here?

[Baroness Drake]

My Lords, I have some sympathy with the noble Baroness’s amendment in wanting to set out in regulation, rather than rely on regulatory rules, some of the things that will be required to make the dashboard function well. I suspect that there are three drivers behind that sentiment. One is that, in this market, the providers are particularly dominant: there is not an equality of arms when it comes to seeking people’s opinion or influencing government policy. Secondly, the FCA itself recognises that it is very difficult to get a functioning market and that it needs to think more and more about intruding in controlling providers’ supply-side behaviour. Thirdly, although the Government understandably want to rely on consultation, those consultations can be dominated by the providers in this market.

Very often, some of the raw consumer issues somehow do not come to the surface and the consumer groups often do not have sufficient resources to do the kind of detailed analysis that a submission requires to pull out some of the fault lines when these things are looked at through a consumer perspective. Members of the public are not going to participate because they simply do not understand what the issues are in relation to their interests until they experience them. I therefore have a lot of sympathy, leaving aside the precise wording of this amendment. The Government need to understand that sense of those three sentiments that often drive many of these amendments: the providers are over-dominant; even the FCA recognises the need for greater intrusion on providers in the supply-side; and consultation is often not an effective remedy for sufficiently capturing the consumers’ interests. Therefore, the more that is put in regulation, the better.