Digital Economy Bill

Lord Stevenson of Balmacara Excerpts

Report: 3rd sitting (Hansard): House of Lords
Wednesday 29th March 2017 Lords Chamber

[Lord Fox (LD)]

My Lords, as someone who has proposed amendments that go some way in this direction, I welcome this move, which in some part meets what we propose elsewhere. I have one question around the wording:

“OFCOM must have regard to the statement when carrying out”,


its related functions. What exactly does that mean? Is that language replicated exactly for Ofwat and Ofgem? How should that regard be manifested by Ofcom?

[Lord Stevenson of Balmacara (Lab)]

My Lords, rather like the last speaker, I welcome this measure but am a bit nervous about it. The idea that the Government of the day should be able to set out their forward thinking in a way which is helpful to the regulatory functions is a good one. However, as other external viewers have sought to point out, it raises worries about whether the regulator is truly independent of government in that mode, and whether the Government might be accused of setting an agenda which would then be imposed through a well-respected regulator which everyone thinks is doing a good job in a way that might not have been the case had the process of primary legislation followed by regulations been the approach taken. I hope that when the Minister responds he will confirm that there is no intention for this measure to circumvent the clearly established arm’s-length relationships between the regulator and government. It would be helpful if he could do so.

In another Bill—I sometimes get confused, so I hope that I am discussing the right one—we talked about how the Secretary of State for Education has responsibilities in relation to the new body that is to be set up in higher education, the Office for Students. However, we think that it should be called the Office for Higher Education. In that Bill, the words “have regard to” the instructions given by the Minister are very much part of the way in which that system operates. However, that situation is different in the sense that the measure replaces an existing arrangement for a body which was not a regulator—HEFCE—and for which the only mechanism whereby higher education policy could be created was by letters of instruction. That usually takes the form of an annual letter to HEFCE which sets out the Government’s wishes for the future year, sometimes for several years ahead. I make that point simply because it would be helpful if the Minister could make it very clear that the model here is one of improving an arrangement which will be for the benefit of the exercise of the powers that already exist, and does not add new layers of bureaucracy or new powers, and that the intention is not to set an agenda or to curtail the independence of Ofcom, as I think the system would not work without it. Otherwise, I welcome what is proposed.

--- Later in debate ---

[Lord Pendry (Lab)]

My Lords, many of us have been around this block many times before, and here we are again discussing the negative impact that secondary ticketing has on the sport and entertainment sectors. I therefore willingly support the amendments standing in the name of the noble Lord, Lord Moynihan, who, as we have all heard, has so ably spelled out his reasons for tabling them.

It is a particular pleasure for me that these amendments carry his name because many years ago we were old sparring partners in the days when he was Minister for Sport and—if noble Lords can believe it—I was his shadow. I could not keep up with all the Ministers for Sport whom I shadowed but certain names spring to mind: Atkins, Tracey, Key, Sproat and Spring. I wrestled with them all but, a priori, the best by far was Colin Moynihan MP, who now carries a different hat in tabling this amendment. However, because his tenure in office was a short one before he moved onwards and upwards to become a Minister in the Department of Energy, I did not receive his wise words on the vexed question of ticket touting at that time. I did, however, receive volumes of advice from other Ministers, telling me that it was not the time to enact legislation to curb the touters. Even as early as 28 September 1992, the then Prime Minister, John Major, wrote to me:

“Although committed to give effect to the recommendations of Lord Justice Taylor … because of the lack of parliamentary time”,


it was not the time to proceed with legislation on ticketing.

So progress has been slow. With the exception of legislation on football, not much has been achieved in the field of eliminating ticket touting. However, progress now seems to be at hand, thanks to the noble Lord and his colleagues, who I am sure will be the first to recognise the work of the late and lamented Lady Heyhoe Flint, who worked alongside them and did so much to give us the opportunity to debate the issue this evening. They are giving the Government the opportunity to embrace the need to protect consumers’ rights and to call for a thorough study into secondary ticketing. These are important measures.

I am sure that, by now, noble Lords will have recognised why I am adamant that these amendments should be passed. As shadow Minister for Sport from 1992 to 1997, I worked on a blueprint for sport for the Labour Party which was brought together for the 1997 general election. That manifesto, Labour’s Sporting Nation, was endorsed by the then Prime Minister-elect, Tony Blair. Of course it was an important time for me personally, as the one who wrote that document, as I believed that we were in sight of ensuring a breakthrough in this ticket touting problem. In particular, the passage on touting concluded with these words:

“A New Labour Government will make touting at all major sporting events illegal and therefore eliminate it”.


I do not want noble Lords to bring out their handkerchiefs and tissues in sympathy for me at this moment but, as the House knows, as the author of that dictum I was not given the opportunity to bring that commitment into legislative form. But seriously, the then intention was to introduce explicit legislation that directly dealt with the problem of ticket touting. But the world has moved on, as we all recognise, and we are in a different age. One has to recognise that the world of 1997 is not the world of 2017. A lot has happened since, which has been acknowledged by the noble Lord, Lord Moynihan, and his colleagues who submitted these amendments. We must also acknowledge the way that they have gone about that in the months preceding this debate.

By supporting these measures we will be giving further power to protecting consumers and ensuring that effective enforcement takes place. This will give greater choice and information to sports fans and help in the fight against those who commit fraud and seek to exploit the pockets of hard-working families. Like others, I have received correspondence from a number of bodies which usually support what we are doing this evening. The UK stages some of the world’s greatest sporting events. If we want them to flourish and for the country to continue to be open for business, we must protect those events from the profiteering of those committing fraud.

Organisations involved in rugby—both rugby league and rugby union—tennis, and cricket in England and Wales already do good work. We need to empower them to do more. The amendments before us give us that opportunity. They would give them the right to take civil action in a court if they so wished. The Minister will no doubt tell us when he replies about the importance of enforcement. I would like him, ideally, to accept the amendment before us. By accepting that progress has been slow, we have arrived at an important time when this House can endorse the amendment before us and people such as Lord Justice Taylor, Professor Waterson and those who have done so much in the past will, I am sure, benefit from what we do today.

[Lord Stevenson of Balmacara]

My Lords, I have been following the progress of this arrangement between all sides because the noble Lord, Lord Moynihan, and Lady Heyhoe Flint—who is terribly missed—the noble Lord, Lord Clement-Jones, and I have been doing this for about four years now. We are reaching the next stage. I do not think we are at the end of the track yet—there are still things that we would like to do—but we have reached an important stage and I should like to support what we are doing.

The issue is all about the rights of the promoters to organise the events that they want to and have control of them, and the rights of consumers who sign up to see these events to do so with the security and certainty that they will be able to see what they have paid for at reasonable prices. The Minister has said that what he has done with the bots amendment is to try to modernise the modern-day ticket touts. I absolutely agree with that. That is why I have signed up to his amendment. There were real difficulties getting this through, which I know because I have talked with the Bill team and the Minister about this. It is really good to see the amendment here today. We will support it and wish it well on its way.

However, the other amendments in this group, which we also support, should not be lost sight of and I hope very much that we will get some movement today. They stem from recommendations 4 and 5 of the Waterson review. They are in keeping with those and try to establish further what the Minister articulated when he introduced the original amendment: as well as having a good partnership with primary ticket sellers and the secondary market, it is really important that the law has a good relationship with consumers and event promoters. Only by providing additional transparency, which was requested in Amendment 33ZLZA—and possibly in the good suggestion that governing bodies get more power in Amendment 33ZLZC—will we begin to take the steps that will clean up this act.

We know from the police reports, from those who are active in this area and from talking to promoters that there is huge criminality and money laundering. There are issues that we really have to investigate. But at the heart of it stand consumers who cannot rely on the market providing them with the right choice and a fair one. This must stop. If the noble Lord wishes to take his amendment to a vote we will support him in the Lobby.

[Lord Ashton of Hyde]

My Lords, I am grateful to all noble Lords and I will try to be quick because I want to move on to the dinner break business. I pay tribute to my noble friend Lord Moynihan for his persistent campaigning on the subject. His work has influenced today’s government amendment, as has the work of other parliamentarians and particularly Nigel Adams MP and Sharon Hodgson MP.

Amendment 33ZLZA would amend the Consumer Rights Act 2015, by inserting a duty to provide the ticket reference or booking number when reselling tickets. This was specifically considered by Professor Waterson in his report. So I start by reminding noble Lords of the reasons that Professor Waterson gave for rejecting the same proposal that we now have before us in Amendment 33ZLZA. I refer to page 170 of his 226-page report. The first was cost. The amendment would require a system for the potential buyer to check a reference number, and in a manner that could be done quickly enough to facilitate internet sales. That requires infrastructure changes in both the primary and secondary market. The primary market would be asked to pay for changes to allow customers to authenticate tickets on the secondary market, for which they receive no additional income. Ultimately, the cost will be added to ticket prices.

Secondly, there is practicality. The secondary ticketing industry would need to establish a standard interface to enable cross-checking. There is strong competition between the platforms and no appropriate industry body to help bring such a system about. In such circumstances, it may be easier and possibly more productive for the secondary platforms simply to chase more exclusive authorised resale deals. Further, there is little evidence of there being the trust between the primary and secondary markets necessary to enable such verification.

Thirdly, my noble friend has mentioned the legal reasons. The EU consumer rights directive, which is the basis of the secondary ticketing information requirements in the Consumer Rights Act, prohibits member states going further in national law than the directive requires. My noble friend mentioned his telephone conversation with the European Commission. There are differences of opinion on the legal interpretation and clearly, at the very least, there may be litigation ahead if we go down this road.

The Government agree with Professor Waterson. We cannot see how Amendment 33ZLZA would actually benefit anyone. Even if those problems were overcome and the primary sellers would offer a consumer confirmation that a reference number was real, how do we know that the real ticket is available for sale? Might it have already been resold? Consumers who buy tickets online, only to be disappointed, will be even angrier having gone to the effort to “verify” yet still being left in the lurch.

Professor Waterson preaches caution in further legislating with good reason. Amendment 33ZLZA is untested and offers false hope. While ticket reference numbers do not offer a solution, we agree with the proposal to require consumers to be informed of the terms of resale. Indeed, we have already legislated to do just that in Section 90(3)(b) of the Consumer Rights Act. Rather than amending the Consumer Rights Act, we believe that the existing law should be tested.

The need for better enforcement was also the overwhelming view of those who gave evidence to the Culture, Media and Sport Select Committee last week, and the Competition and Markets Authority’s enforcement investigation is ongoing. In addition, National Trading Standards and Trading Standards Scotland have been tasked with investigating potential enforcement cases against sellers on secondary ticketing websites that do not comply with the legislation.

I turn to Amendment 33ZLZC. While injunctions are already possible, the amendment would introduce a new element into consumer law by seeking to shift the responsibility for enforcement to the primary ticket seller. This could risk putting an undue onus on event organisers regardless of their capacity to act because public enforcement bodies could use it as grounds to prioritise other areas for enforcement action. The amendment also requires us to trust primary sellers to self-regulate and self-enforce, yet to date the sector has often been too unwilling or unable to take action. There have been notable exceptions, but the strides that we are making, as I set out at the start of the debate, have been achieved by bringing together the parties, including law enforcement agencies, and we need to build on that.

Although Amendment 33ZLZB is similar to the one the Government have tabled on the use of bots, it goes further by attempting to ban the resale of tickets purchased by bots. I acknowledge my noble friend’s kind remarks along with those of the noble Lord, Lord Stevenson, so to save time I will not comment in detail as I understand that my noble friend is content with the government amendment.

In conclusion, the Government recognise that it is hugely frustrating for fans who miss out on tickets sold on the primary market only to see them appear on the secondary ticketing market at increased prices. The Government are acting—working with industry and law enforcement agencies. We need to let these developments grow and allow time to harvest the results of the legislation that we agreed in this House only two years ago. I would respectfully ask my noble friend to withdraw his amendments and noble Lords to support government Amendment 33ZL in their place.