Unsolicited Telephone Communications Bill [HL]

Baroness Hayter of Kentish Town Excerpts

Friday 8th November 2013 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

My Lords, I apologise to the noble Lord, Lord Selsdon, for not giving him warning that I would speak in the gap. I have, however, informed both the Front Benches. I was not certain that I would be here in time today, which is why I was not able to put my name on the list. I apologise to the House for that.

I speak because of a particular interest of mine arising from my earlier role as vice-chairman of the Financial Services Consumer Panel. We were dealing with PPI and pressed first the Financial Ombudsman Service and then the FSA very hard to take action on its mis-selling. We thought that we had achieved a lot when it was realised that, while the product was not necessarily bad in itself, it was being mis-sold. It took a long time to persuade people of that, but when we had it was clear that a number of them would get redress. I was therefore not ashamed but immensely disappointed to discover that the unintended consequence of that was this absolute barrage of phone calls; many noble Lords, many of whom may not be here today, have recounted stories of being offered money back that they had never actually spent.

As the House will know—there was an exchange on this just yesterday—we are quite chuffed that we have now got a similar move forward on the ability of tenants and landlords who might have been mis-sold something, or mistreated by a letting agent, to take that to an ombudsman. That will become legislation and will come into force some time in the coming year. However, I fear that the same lot of people will again be after rich pickings and will start phoning up tenants and landlords in the same sort of way. We cannot just deal with this problem issue by issue.

The Bill therefore seems extremely timely. I myself have opted out but I still get these calls, mostly from abroad, which do not seem to be caught by the opt-out. One is also not able to trace the number to call back and make complaints. Partly personally, but partly on behalf of those consumer groups that do so much to get things such as redress and then find that that leads to this sort of nonsense, I thank the noble Lord for introducing the Bill and I wish it well.

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[Lord Gardiner of Kimble (Con)]

My Lords, I make it clear from the outset that the Government very much welcome and appreciate the efforts and concern that my noble friend has shown in highlighting this important issue. I am sure that, for many consumers, my noble friend reflects the feeling that something more needs to be done to deal with this problem. The noble Baroness, Lady Hayter, and the noble Lord, Lord Stevenson of Balmacara, also raised the points about consumers and the redress and improvements we all seek. The Bill is welcome in that it is a timely opportunity for further discussion.

The resolution of this issue is more complex than at first sight it might appear. It requires industry, government and consumers to collaborate if there is to be any chance of success. Unsolicited telephone marketing nuisance calls are certainly topical and have been the focus of vast amounts of correspondence, many Parliamentary Questions, a Select Committee inquiry in the other place and an inquiry led by the All-Party Parliamentary Group on Nuisance Calls, as mentioned by the noble Lord, Lord Stevenson, whose report was published last week.

These reflect the clear fact that, despite the Privacy and Electronic Communications (EC Directive) Regulations 2003 being in place, unsolicited marketing nuisance calls are a source of great annoyance and inconvenience for consumers. Indeed, when I pick up a message which starts, “That’s right!”, I am pretty certain that it is not. I also may well ignore being instructed to press a certain number to get further information. To many, however, and especially the elderly and more vulnerable, as all noble Lords have said, this causes confusion and great anxiety. I wish that there were a magic wand that could be waved to eradicate the problem but, sadly, that is simply not possible.

I assure noble Lords that we are absolutely determined to take action on this issue. That is why the Minister for Culture, Communications and Creative Industries has initiated and led a serious of meetings over the past 18 months which have brought together the key interested parties to press for change. Unsolicited calls and texts are a problem, but we have to be careful that, in dealing with this issue, we do not harm the direct marketing industry, which is a legitimate industry that provides employment and opportunities in support of our economy. The noble Lord, Lord Stevenson, made precisely that point. Direct marketing can be beneficial for consumers—for example, calls from telecoms or energy companies advising on better deals or tariffs potentially save consumers money. An opt-in register, as in the Bill, would severely constrain such activities. We must therefore consider the matter carefully.

What action are the Government taking? From those meetings, we now have clearer and improved guidance and information for consumers, to help ensure that they are aware of where to go to register complaints on regulators’ websites. I realise that, of course, to many of the elderly this may not be an option, but this information is now more consistent and readily available. The consumer organisation Which? has also been engaged in the meetings and has developed a useful mechanism on its website by which consumers are automatically directed to the right place to access information as well as to make complaints.

On enforcement, we have ensured that the monetary penalties that the Information Commissioner’s Office and Ofcom can use have been increased and, equally importantly, used more frequently to fine companies which break the regulations. We have made clear in tasking regulators that, through robust action, they must send a clear signal that those who flout the rules will be caught. We are pleased that, since January 2012, more than £2.3 million has been issued in fines and would want to see more.

Persistent offending companies are also now named and shamed on the Information Commissioner’s Office website, so that those who engage in poor practice are made known to the public, as informed consumers are safer consumers. There is also greater collaboration between regulators, sharing knowledge and expertise to improve compliance throughout. However, we are fully aware that much more needs to be done. That is why our future proposals for nuisance calls were set out in our strategy paper published on 30 July. These include legislating to ensure that Ofcom can share information more easily with the Information Commissioner’s Office. We will be implementing this through a statutory instrument that will be laid shortly, with a view to it coming into force by 6 April 2014 at the latest, if not sooner.

We are also actively considering the scope to legislate to lower the legal threshold the ICO needs to demonstrate before issuing a monetary penalty, which the noble Lord, Lord Stevenson of Balmacara, mentioned. We are assessing the business case and the cost before we take action on this. In view of the large number of nuisance calls relating to the payment protection insurance sector, which the noble Baroness, Lady Hayter, referred to, we are also working closely with the Claims Management Regulator. It is welcome to see that the CMR is taking action against claims management companies which fail to comply with the rules.

[Baroness Hayter of Kentish Town]

The Government have made no progress yet on the funding of the claims management ombudsman. If the Minister is not able to answer now, I hope he can come back and maybe give a report to the House on that.

[Lord Gardiner of Kimble]

It is probably best if I write to your Lordships so I can give chapter and verse on that matter.

The main issue in this Bill is changing from the current opt-out requirement to an opt-in system for unsolicited direct marketing calls. There is a feeling that this is unlikely by itself to make an impact on the present situation, as calls to consumers who are registered with the Telephone Preference Service, provided they have not given explicit consent to receive such calls, are already outlawed under the Privacy and Electronic Communications Regulations. Germany has an opt-in system but, according to a study in 2011 by trueCall Ltd, complaint levels are broadly similar to those in the UK. The Government’s view is that those breaking the law by calling consumers registered with the Telephone Preference Service are just as likely to ignore the law, regardless of whether there is an opt-in or opt-out system. Tackling nuisance calls would be better addressed by focusing on improving enforcement rather than changing the nature of the register; legislation of this nature is unlikely to be the answer.

The Government will continue to work with regulators, network operators, consumer group representatives, interested Members of Parliament and Members of your Lordships’ House to find solutions. A combined effort by all parties is needed. This is now beginning to happen and we are ensuring that work by the industry is also under way including, for example, the ability to trace calls where the calling number is deliberately withheld or spoofed. This will also help contribute towards achieving more long-term solutions. We welcome the fact that TalkTalk last week launched a network-level solution for its customers and that BT will be displaying full call-line identification for incoming international calls, where available, on its network by next autumn. Last week, the Telephone Preference Service launched its accreditation scheme, TPS Assured, which seeks to improve best practice among companies. We know that there are already products on the market which can help consumers filter calls. We are keen for the UK to take a lead in developing the solutions that put the power in the hands of consumers. We are aware that, as part of the joint action plan to tackle nuisance calls and messages, which was launched by Ofcom and the Information Commissioner’s Office in July, research is being undertaken to see what further improvements can be made to the Telephone Preference Service. All this is extremely welcome.

We take the issues raised in this Bill very seriously and very careful consideration needs to be given to them. The reservation we have about my noble friend’s Bill is not that we do not share the intention to remedy the matter but that we think there is a more effective route to securing what my noble friend’s Bill seeks to achieve. We already have regulations in place that protect consumers, so the focus needs to be on better enforcement in support of them. In addition to the measures noted earlier, we are actively considering proposals for further reform. The recommendations of the report from the All-Party Parliamentary Group on Nuisance Calls, published last week, and the forthcoming report of the recent CMS Select Committee inquiry will be useful in informing further our thinking in this area. The work is ongoing, and the Government will publish their action plan on nuisance calls later this year. I hope that your Lordships will understand that this reflects the importance and urgency of this issue.

The practical way to solve this issue is to get industry and regulators to work together. Like my noble friend, I am eager to find effective solutions, both legislative and non-legislative. In doing that we need to balance the right of business to conduct legitimate direct marketing while strengthening the regulatory framework and industry best practice to target companies that flout the rules. In view of the work, legislative and non-legislative, I assure your Lordships that we are progressing efforts to counter the issue of unsolicited marketing of nuisance calls with vigour.