Public Bodies (Abolition of the National Consumer Council and Transfer of the Office of Fair Trading’s Functions in relation to Estate Agents etc) Order 2014

Baroness Oppenheim-Barnes Excerpts

Tuesday 11th March 2014 Lords Chamber

The decision to wind up the NCC having been taken, we want the new system to work as well as it can for consumers. Our regret is that this order implements an overhasty, ill thought-out change caused simply by the Government wanting to reduce the number of quangos, and that it fails to produce a coherent framework or a single voice to protect consumers. It fails to harmonise redress for estate agents and letting agents, and it fails to produce adequate parliamentary or ministerial accountability for the new framework. I beg to move.

[Baroness Oppenheim-Barnes (Con)]

My Lords, I quite naturally have a great interest in this debate as not the mother or even the grandmother but probably the great-grandmother by now of the introduction of the very first National Consumer Council. My noble and learned friend Lord Howe was the Minister in charge and I think the first chairman was John Methven. The next chairman was the noble Lord, Lord Borrie. I had just come to office as a Minister of State and to establish my neutrality all my senior officials said, “You won’t want to reappoint him. He’s a supporter of the Labour Party”. I said, “I want to reappoint him because he’s the best for the job and has always been the best for the job”. Right up to the very end, he was the best for the job. That is just establishing that I am not making very much in the way of party political points. However, I would be much more sympathetic to what the noble Baroness has said today if not for the fact that during the Committee stage of the Enterprise and Regulatory Reform Bill I had a strong amendment to take out the provision that virtually ended the life of the Office of Fair Trading and another for the Monopolies Commission but I received no support whatever from the party opposite. If I had received support—meaningful support—I would have been quite willing to table amendments at Third Reading that would have had a great deal more importance and significance. After all the things that the noble Baroness has said, I regret very much that I did not get that support at that time.

When one looks back over the years, when we started the Office of Fair Trading and when the Monopolies Commission existed and then the NCC—of which I subsequently became chairman—things were done in great detail for the benefit of consumers and to a very high standard by both those organisations, and no one is sure what exactly is replacing them. It looks extremely like just another government department, which is not exactly what we would have accepted as a replacement that would be as available and as important as those two bodies. They have had a very quick demise, considering the date of the Bill and what was then going to happen. I regret this very much indeed. However, I say on behalf of the Government and also on behalf of the Conservative Party that we have been the leaders in all matters of consumer protection. We did not have junior Ministers; we had Ministers of State, with their main responsibility being consumer affairs. We did not have secondary Ministers. For the whole 13 years that I was in your Lordships’ House in opposition, we did not have anything very important and the only Minister was a very junior Minister, who had other things in his portfolio—which I think included the little matter of Northern Ireland.

I feel that the noble Baroness has to be fair in these matters and explain why I received no support. We might have had a different outcome or influenced the Government in what they were going to do next. Now we have a big, new Consumer Rights Bill going through the other place, which I know the noble Baroness supports, as do I. We might want to tweak it here and there—indeed, that is quite likely—but it establishes that this party and this Government are not anti-consumer. As a past chairman of the NCC, I understand her concerns and I sympathise. I want to give the Government a chance to take note of what we are saying and of what we said in Committee and at Third Reading, but there are still some areas that are not clear and not satisfactory. It is not just the voice or anything of that nature but how it is going to work, which is the most important thing about it.

Therefore, I have a great deal of sympathy with this Motion of Regret. However, I still would like somebody on the Opposition Front Bench to give the right amount of praise to Conservative Governments over the years for what they have done for consumers and for the trails that they blazed, and to welcome the new consumer legislation, which is still in the other place but will be in your Lordships’ House, I believe, in the autumn. Those are my views. They are mixed, but the principle of the Motion is one with which I have to sympathise.

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[Lord Harris of Haringey (Lab)]

My Lords, I declare an interest as chair of the National Trading Standards Board, which a number of noble Lords have mentioned. I am pleased to take part in a debate where so many distinguished Members of your Lordships’ House who have played a significant and major role in the development of consumer affairs and consumer protection in this country have participated: the noble Baroness, Lady Oppenheim-Barnes, and my noble friends Lord Borrie and Lord Whitty. I am not going to travel down the historical road on which the noble Baroness, Lady Oppenheim-Barnes, took us. I recall when I was a very junior staff member of an organisation—abolished I think by a Conservative Government—called the Electricity Consumers Council, her rather grand appearance before us when she was Minister for Consumer Affairs. I also remind her that it was, I think, a previous Labour Government who had consumer protection as a Cabinet role fulfilled by my noble friend Lord Hattersley, who is not in his place today. That was some years ago—

[Baroness Oppenheim-Barnes]

It was not quite the same thing.

[Lord Harris of Haringey]

I accept that it was not quite the same thing.

The Minister in his introduction told us that the Government’s aim was to improve the offer to consumers. When we talk about the transfer of estate agent functions, essentially we are not talking about a change in the offer. What is happening is a transfer of what I am assured—I am not sure that the Minister actually said this in Committee—is the same sum of money that was expended by the Office of Fair Trading on the estate agent regulation functions, through the National Trading Standards Board, for the function which has now been awarded to Powys. It is, therefore, the same money, not new money. It is not an improvement in the offer. I shall come back to why that is important in a moment.

The £178,000 or thereabouts spent by the Office of Fair Trading has now passed to the National Trading Standards Board. As a board, we went through a commissioning exercise. As has been reported, six bids were received from local authorities around the country and Powys was selected by the selection panel to be the successful bidder. For the avoidance of any doubt, given some of the comments made in the other place, I should make it clear that none of those involved in the selection process was associated with the bids considered.

My noble friend Lady Hayter implied slightly pejoratively—I think that she was slightly overegging the case for the purposes of debate—that one officer from Powys had been seconded into the Office of Fair Trading to learn how to do it. I had the benefit earlier today of meeting a number of the officers from Powys who are responsible for this function. As I understand it, two officers from Powys are working in the Office of Fair Trading at present, for a very specific reason. Because of the problems that the government business managers have in processing business through your Lordships’ House and elsewhere, this order has not yet been made. As a consequence, it is not possible for preparatory work to be done in respect of how this function is to be carried out because the information cannot legally be transferred from the Office of Fair Trading to Powys County Council. So until your Lordships pass this order, the files cannot be moved and it is necessary for the officers from Powys to work through the Office of Fair Trading and carry out that function.

It is worth emphasising that this is a national function that will be delivered by a single local authority. That is not a unique model. There are a number of functions financed through the National Trading Standards Board where that is the model. The Minister referred to the illegal money lending teams for England and Wales, which are administered by a single local authority. The Illegal Money Lending Team for England is a very large organisation with a large number of staff, delivering services around the country, not only to consumers but in terms of outreach, and using the money seized under the Proceeds of Crime Act to improve consumer education. I was involved at a launch in a school in north-west London only a few days ago where a teaching pack for schools was being launched to ensure that pupils acquire the necessary skills to manage their own money and to understand the dangers of them and their families falling into the hands of loan sharks. That is a national function being delivered by a single local authority—in that case, the City of Birmingham.

There are similar examples in the work that is done on e-crime, on behalf of trading standards, which is delivered by North Yorkshire County Council, and the work being done on the national intelligence hub, which is delivered by Suffolk County Council. You can go through a list of functions that are delivered by agreement, by a memorandum of understanding, by individual local authorities in this way. So the Powys example is by no means unique. It is worth recording that and to recognise that this is about establishing and maintaining a single national state agency enforcement unit, providing an appropriate adjudication system, including a process to manage appeals; to provide and maintain a web-based public register; and to approve and monitor the approved estate agent redress schemes to which my noble friend Lady Hayter referred.

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The noble Lord also raised the issues of the lack of staff transferring to Citizens Advice and the trimming of resources. I hope that I can give him some reassurance that the vast majority of policy staff will transfer to Citizens Advice. Next year’s levy-funded budget will be the same as this year’s. The noble Lord stated that funding for general advocacy has been cut. Budgets have been squeezed since 2008 in the light of pressure on the public finances, but we are confident that efficiencies created by this transfer will enable Citizens Advice to step into this role.

[Baroness Oppenheim-Barnes]

My noble friend will remember that in Committee during consideration of the then Enterprise and Regulatory Reform Bill I cited the amount of money that I made available to Citizens Advice in 1979-80 because of a small increase in its duties. It was £3 million then, which, in terms of what is being given now, causes me great concern. All members of citizens advice bureaux are not necessarily well versed in consumer affairs—they have other qualifications. If situations arise in which they do not know what to advise, who are they going to ask to tell them?

[Viscount Younger of Leckie]

I should like to write to my noble friend to clarify that question and give her more detail about the transfer. I hope that I will be able to give her some figures and will copy in other noble Lords to provide further details. I hope that that gives my noble friend some reassurance.

The noble Baroness, Lady Hayter, suggested that the provisions in the order do not provide—