Lord Whitty
Main Page: Lord Whitty (Labour - Life peer)Consumer Rights Bill
Lord Whitty Excerpts
Lord Knight of Weymouth (Lab)
My Lords, the amendment raises an interesting question, which I thought I should take the opportunity of posing to the Minister. A cursory glance at Hansard from the other place suggests that the Government’s intention is that consumer rights in this legislation should apply to consumers of public services as well as private services, which is what the amendment addresses. The question that arises refers back to the last time I attended this Committee, when we were discussing consumers’ rights in the context of digital.
With normal goods, one has the right to return them and seek a refund or replacement. I am intrigued as to how that would work with some public services. For example, does this apply to the licence fee? If I do not like what I consumed on my television, do I have the right to a refund or replacement? Of course not, but how does that work in the context of the Bill? If I have paid tuition fees and I am not satisfied with the nature of the service that I receive from a university— I hazard a guess that quite a few students might at times have problems with, for example, the amount of access they have to face-to-face tuition—am I considered, in the context of the Bill, to be a consumer with the same rights as I would have in the private sector? I should be interested to know how that plays out. Or do we, as the amendment suggests, rely on the regulator? In which case, is that all pinned down properly in the Bill?
Lord Whitty (Lab)
My Lords, I support what my noble friend has said in moving the amendment. I want to address for a couple of minutes Amendment 105A, which deals with the issue of consumer representation and how it is reflected within the structures of our regulators.
In general, it is stated early in each of the relevant Acts that the regulators are there to protect, advance or reflect the interests of consumers of gas, electricity, water, telecoms or whatever it may be. Much of the drive within those regulators is indeed geared towards that. However, it is also true that a whole lot of other broader, less direct duties in relation to consumers fall to those regulators. Successive Governments have, rightly or wrongly—I will not go into that too much—placed additional responsibilities on regulators to have regard to wider issues, to long-term and short-term issues, and to social and environmental consequences, for example. One understands all this if we are to develop industry in a way that meets those wider objectives and looks after the interests of consumers.
Put gently, in some cases the duty to look after the interests of consumers, in a simple sense, has been slightly lost. Some of that reflects the fact that the personnel who form the boards and the senior management of these regulators by and large do not come from a consumer background. They come from various technocratic and business backgrounds and in some cases from an academic background and they have the expertise that is necessary to understand the industry that the regulator is dealing with. However, the voice of the consumer in a clear sense is much more difficult to identify.
Lord Whitty
“Access to data
Schedule (Access to data) has effect.”
Lord Whitty
I shall speak also to the rather more substantial Amendment 81A for which Amendment 50L is the paving amendment. For this purpose I have briefly and temporarily transformed from a humble Back-Bencher to speak on behalf of the Labour Front Bench, but it will not last.
These amendments are about access to data for consumers. It is true that under existing data protection legislation British consumers have a legal right to request access to the personal data that businesses hold about them, but the majority of consumers have no idea of that, very few of them do it and, for those who do, it takes an inordinately long time to get the information out. Which? did a survey indicating that for those who do, it can take up to 40 days.
The Government are seized of this issue because in 2011 they set up the midata project, which is a voluntary programme covering four specific sectors. They are very important sectors, but there are only four: energy, mobile phones, providers of credit cards and providers of current accounts. The aim was to give consumers better access to their personal data in portable electronic form. The midata project has so far been somewhat disappointing. After 2012, the Government took an order under the Enterprise and Regulatory Reform Act to compel businesses within those areas to release consumers’ consumption and transaction data in a machine-readable portable electronic form on request. This has not really worked, and there has been no extension beyond those sectors. Data sharing between individuals and service providers and between intermediaries and those suppliers is still clunky and limited and, particularly for vulnerable consumers, difficult and potentially hazardous.
Our amendment in the new schedule which Amendment 81A would introduce is designed to tackle these problems by, first, ensuring that access to data is clearly a key consumer right and, secondly, by making sure that the Government use the powers that, in general, they already have to ensure that consumers are able to access portable data through the midata project and the provisions of the Enterprise and Regulatory Reform Act. That includes engaging third parties—the so-called next generation intermediaries in particular—to that data with appropriate protections. That can lead to redressing the balance significantly by at least allowing for the possibility of some collective bargaining for a group of consumers.
The amendment also asks the Government to report on other sectors to which the present midata provisions should and could apply; provides for traders to have to ensure that they have the best information; ensures safe data handling, including the consent of the individuals concerned and the appropriateness and identity of those concerned; and ensures that where there is a public benefit from generalising that data on an anonymised basis, it is genuinely anonymised and that consumers know their rights about their own data.
This amendment requires the Government to use their existing powers and to report back on how those powers should be extended. It requires them to look at other services and at the interplay with the intermediaries. First-generation intermediaries are what we call, generally speaking, comparison sites. There are problems with the quality of the data in comparison sites, as recent reports have shown. It is not always clear what range of companies within the sector comparison sites cover, nor is the commercial relationship between the comparison site and the providers clear.
The authentication of comparison sites is not yet substantially in place. The former Office of Fair Trading attempted to establish a confidence code. In the energy sector, there was a point when my old organisation, Consumer Focus, was subcontracted by Ofgem to look at the effectiveness of comparison sites, but there is no overall approach to ensure that those sites are genuinely doing the intermediary job of providing a range of information that would ensure that consumers can make a sensible and understandable choice. Millions of consumers benefit from access to comparison sites, but some sites are significantly better than others. Some are more subject to possible corruption—although corruption may be too strong a word. The relationship with the people whose information they provide to consumers is on a commercial basis and excludes other providers. This is an area in which the Government should intervene, as technology allows us to move further into the use of consumer data in these areas.
My noble friends under earlier amendments referred to the issue of the public sector, which also runs major projects on consumer transactions, particularly in the NHS and social care. Access to and knowledge of that information needs to be covered by any regulation and any provision of extension of rights for consumers on the data that public services provide. That includes not only the public services in the sense of the NHS itself but those organisations commissioned by the NHS to provide public services—so when they are outsourced, data also need to be covered by the provisions. We need tough penalties for the public sector as well as for the private sector when such information is misused.
This is a wide area on which we are asking the Government to report, but an important one. An empowered consumer should be able to rely on these intermediaries to present the information to them and to ensure that their own transactions are not misused in the compilation of both the providers’ and the intermediaries’ use of data. I would hope that the Government could at least accept the principle that a report on these areas should be required and should be, in our words,
“within six months of the passing of this”,
Bill, so that we can look at what further provisions are necessary. Then we can protect the consumer while enhancing the effective use of data and access to data in a way that empowers rather than threatens consumers, particularly the more vulnerable ones. I beg to move.
Lord Whitty
My Lords, I am grateful to the Minister for outlining the developments that have taken place in midata and related projects in recent months. Clearly, the Government have in mind the need to address some of the problems that arise from this range of data and the opportunities that they give and the dangers that they present.
The exchanges between my noble friend Lord Knight and the noble Baronesses, Lady Oppenheim-Barnes and Lady Wilcox, indicate the difficult road that we have to travel on this because there are some serious potential public benefits from the use of aggregated data and their use in individual circumstances provided the individual understands and knows that that is what is being done to their own individual information and has clearly consented to that.
In many fields this is not yet an issue but it will become one in a range of fields, as was recognised when the midata project was first being discussed. I am grateful for the information on the progress that has been made in relation to current accounts, for example. The purport of my amendment is not to tell the Government where they are to draw the line or where the need to protect the consumer should prevent potentially beneficial use of the data, or vice versa—that is, where the rights of the consumer could be overridden by the use of public data—but to assess across the board where we are on all this.
We ask for a report within six months. That may be a bit fast given that one or two other things have to happen within the next six months. However, the Government should pull all this together within a reasonable period. This is not a prescriptive amendment; it would require an overall analysis by the Government. I still think that is necessary. Some big issues are involved here and there is great potential in both the public and private sectors but there are also issues around confidence, control and vulnerability on the part of individual consumers which also need to be addressed, and I do not think that an entirely sector by sector approach will be sufficient.
I hope that the Government will consider this again, perhaps over a slightly longer timescale than is prescribed in the amendment. We will have to return to this issue at some stage, not necessarily during the passage of the Bill, but within a relatively short period of time. In the mean time, I accept that I should withdraw the amendment.
Lord Blencathra (Con)
My Lords, I support the thrust of this amendment. As my noble friend Lady Wilcox said, the regulators were all set up at different times and in different ways. I am not sure whether it is best to have an amendment in this Bill or to look at regulations applying to all the different regulators and toughen up their charters, so to speak. Perish the thought that I should disagree with the noble Lord, Lord Berkeley, but, leaving aside the London tideway tunnel, my experience of Ofwat was that it was slightly better than many of the other regulators because while the water and sewage industry needs billions of pounds’ worth of infrastructure development, at least Ofwat keeps a tight grip on many of the companies and guards consumers’ interests slightly better than some other regulators.
Leaving water aside, in my experience the worst regulator was Ofcom, which is utterly wet and useless in regulating telephone operators. Perhaps it is, understandably, too focused on radio and the independent television sector and on selling off 4G and things like that, but I do not feel it has been very effective in regulating mobile telephone companies.
I hope the Minister will accept the principle that regulators have to do more to protect consumers’ interests, tailor-made to their current legislation and the job they are doing in their own regulatory field. This Bill may not be the best vehicle for such legislation, but I hope the Minister will accept the principle that regulators have to do more to protect consumers’ interests.
Lord Whitty
My Lords, I, too, support the thrust of this amendment. As I said on an earlier amendment, the consumer interest has often been lost or redefined in the way in which regulators operate. They have often very effectively—I accept that some are more effective than others—looked at the outcome for consumers in terms of price and particular aspects of consumer service. This amendment requires them also to look at process—as to how customers are treated and informed and how prices are set and complaints are dealt with. It would probably be better if something relatively common appeared in the individual pieces of legislation for each regulator, but we have an opportunity in a general consumer Bill to set down the principle. I would hope that the Government could accept that the principle should be set down in something like the words here. The noble Baroness is probably pushing the boat a little far with subsection (4) in that no doubt somebody at the Treasury has already had a look at it and will be advising the Minister appropriately from that point of view. So while I support the principle, in reality the Minister will not be able to accept that—but I hope that she can accept the rest of it.