Consumer Rights Bill

Baroness Howe of Idlicote Excerpts

Tuesday 1st July 2014 Lords Chamber

[Baroness Howe of Idlicote (CB)]

My Lords, I am very pleased to be speaking in this important debate. Like other noble Lords, I firmly support the general principles underlying the Bill. It is crucial that consumers have greater choice, transparency and rights in the public services that they receive, and the Bill provides that.

The current approach, which involves setting out consumer rights across various pieces of legislation, between which there is on some occasions overlap and on other occasions tension, does not make for clarity. A call for evidence in the consumer law review in 2008 revealed strong support across the board for consolidating consumer legislation to make it clearer and more accessible. Respondents highlighted a number of benefits that a rewrite would bring, such as: removing discrepancies and inconsistencies; greater use of plain English; greater awareness of rights, remedies and obligations; greater flexibility; future-proofing and the aiding of business growth. The Bill provides these, too. As the Government have made plain, consumers who are well informed about their rights and what they are buying are more confident, and are more likely to spend money well, getting better deals or buying new goods and services.

There are of course aspects that consumer groups and voluntary organisations that have been in touch with us would like to improve even further. As the noble Baroness, Lady Bakewell, and my noble friend Lord Alton of Liverpool have rightly said, they would like the Government to use the Consumer Rights Bill better to protect children by banning payday lenders from advertising on children’s TV.

I am disappointed that the Government have not yet introduced a financial blocking measure in relation to transactions between people in the UK and online providers based outside the UK that do not possess a Gambling Commission licence. The Gambling (Licensing and Advertising) Act that we considered in the previous Session introduced important legal changes in relation to online gambling. The Government presented the Bill as a piece of legislation motivated very much by concerns for consumer protection. The Act requires that any online gambling provider wishing to access the UK market from another country must obtain a UK Gambling Commission licence, which of course sounds excellent, but there is a problem. The provision of this new licensing regime can enhance consumer protection only if it is harnessed to another provision that securely prevents online providers without a licence from accessing the UK market.

A second provision, however, was absent from the Bill. This problem was raised repeatedly in this House and in the other place. On Report, I moved an amendment to prevent unlicensed gambling providers selling to consumers in the UK. This has been termed “financial transaction blocking”. The amendment had the effect of requiring financial transaction providers not to service transactions between people in the UK and online gambling providers based outside the UK without a Gambling Commission licence.

The Government responded by announcing that the Gambling Commission had spoken to three financial transaction providers who had agreed to introduce financial transaction blocking on a voluntary basis. This was welcome news. At the meeting that I had with the Minister on that occasion, I was told that although the Government did not want a financial transaction blocking clause in the gambling Bill they would be open to making such a provision in a consumer protection Bill. Well, it so happens that we have a consumer protection Bill before us, but as I say no financial transaction blocking measure is proposed in it.

It is clear to me that while a voluntary agreement with three financial transaction providers is very welcome, what we need is a statutory approach covering all providers of financial transaction services. I am advised by online gambling providers that, if financial transaction blocking is not provided universally through law, financial transaction provision will simply migrate to providers that are beyond the voluntary agreement. I would like to ask the Minister whether he would update us on any developments in relation to the voluntary agreement. Are the Government willing to introduce an amendment to this Bill to make provision for financial transaction blocking in order to protect British consumers from unlicensed online gambling operators?

I turn to child protection from adult material and the system of age verification for 18 and R18 content online. In March this year, the online video watchdog ATVOD produced a report on children’s access to pornography. It reported that a staggering 200,000 under-16s viewed internet pornography in a single month in 2013. The study showed that one in five of all UK males aged 12 to 17 who went online looked at an adult website; the same age group was responsible for more than 110,000 visits to one pornographic website alone. The report went on to say that,

“it is very likely that the scale of use remains under-stated”,

because mobile phones and tablet computers were excluded from the research for technical reasons; only desktops and laptops were considered. ATVOD commented that the videos people looked at were similar to R18 videos that can be sold only to adults who visit sex shops.

ATVOD called on the Government to make it clear that adult websites must have a system of age verification in place to guarantee that only internet users aged 18 or over should be able to access material rated R18 by the British Board of Film Classification. But if we are serious about child protection, the system of age verification should block not just R18-rated video on-demand material but 18-rated video on demand material. I understand that the Government have suggested that they will aim to tighten up the Communications Act 2003 to make it plain that the providers of R18 video on-demand material must do so under a system of age verification. What steps have the Government taken so far, and does the Minister not agree that it would make no sense to require age verification in relation to only R18-rated material and not 18-rated material?

Finally, I turn to financial transaction blocking for adult online content. This will ensure that financial transaction providers do not process transactions between internet users in the UK and websites based outside the UK that provide 18 or R18 content without a system of age verification in place. This is a fundamental measure, which will cut the flow of money to such websites, ensuring that they act responsibly and introduce a system of age verification. Beyond filtering, what steps are the Government taking to protect British children from tube sites based outside the UK that show R18 material without any system of age verification? Does the Minister not agree that action must be taken and that financial transaction blocking presents the best way forward?

Like other noble Lords, I am looking forward to a lively discussion—and, I hope, some changes—during the next stages of this important Bill.