Trading Standards and the Green Deal

Chloe Smith Excerpts

Tuesday 10th February 2015 Westminster Hall

[Chloe Smith (Norwich North) (Con)]

I recently received an e-mail from a constituent, that stated the following—[Interruption.] I will let the Minister take his place, because there is a word in this e-mail that will shock him to his core, as it shocked me. My constituent said:

“At 12.55 I dashed to the telephone to hear a cheerful voice announcing that he was speaking from the ‘Energy Awareness Centre’ to advise me of the government’s free energy schemes.

I informed him that I was fed up with these unwanted calls, that I was on Telephone Preference Service, and that I had written to my MP…to complain about the matter. He replied ‘And what do you think she is going to do about that, you T-W-A-T.’

I put the phone down and thought that I would address his question to you.

These are supposedly government schemes which are being promoted at considerable cost and nuisance the public. Could you please ask the Prime Minister, or appropriate government minister, what he is going to do to mitigate this nuisance?”

I was as shocked as you are, Mr Streeter, to hear the language reported, and asked myself what I should do. As an elected Member of Parliament, with the right and responsibility to speak on behalf of my constituents—unlike that anonymous and pathetic coward at the end of the telephone—I said to myself, “I shall attempt to repeat that e-mail in Parliament. This will ensure that the Minister is able to take action on a scam-type activity and will also shame the company and its kind.” I want to raise two issues: nuisance calling purporting to relate to Government energy schemes and the actions of one particular company in purporting to sell green deal products to my constituent.

I support the green deal. It is a good scheme that can help households to lower their bills and keep their homes warmer. I have directed many constituents to the services of Norwich city council and Broadland district council for good advice and information on reputable providers, but I will not stand by while rogue traders fraudulently claim to be registered providers of these products and services or while they intimidate residents, who are often elderly and particularly vulnerable to losing precious savings. I would like an assurance that consumers are properly protected from such disgraceful scams, and I hope that the Minister will explain what procedures are in place and what can be improved to protect consumers from such scams.

First, to add a little more detail on nuisance calls, you have heard, Mr Streeter, the worst of what my constituents are having to put up with, although I have not outlined the quantity of calls that that constituent and others receive. Other constituents tell me that they are also being bothered, despite being on the Telephone Preference Service. The TPS website, I noted this morning, has an entire section entitled “Still Getting Calls”, which states:

“On the whole the TPS is very effective. Any reputable company that values its customers and its brand image takes the TPS very seriously.”

However, it goes on to state:

“We are aware that in recent months there has been a rise in the number of unsolicited calls being received by people registered on the TPS.”

The Trading Standards Institute adds:

“GD accredited suppliers must respect ‘no cold calling’ stickers and respect properly established ‘no cold calling zones’.”

I would be grateful if the Minister explained to me—and to my deeply offended constituent, who has borne the brunt of these idiotic calls—what further the Government might be doing about nuisance calling, whether by phone or in person and whether green deal-related or otherwise.

Let me turn to the actions of a company that has taken hundreds of pounds from my constituents. The company is called Tivium Ltd. It is based in Gateshead and has recently touted for trade extensively in Norwich, including by phone. I understand it has also been active elsewhere in the country. Tivium has charged £299 to at least three of my constituents to assess homes for improvements, including new boilers, purporting to be part of the Government’s green deal, but my constituents have been left out of pocket and with no new boiler.

One constituent told me that Tivium advised him after he had paid for the survey and report that he would be eligible for a replacement boiler under the scheme only if he purchased another installation product from the company. His long, disgraceful story includes misinformation, products he did not ask for, misleading assertions and an utterly false cashback promise. He feels ashamed that he let Tivium pass his judgment and

“can imagine this plausible salesperson intimidating others with such assertions”.

He would like to know the actions available to him to reclaim money extracted from him on false premises, so I would be grateful if the Minister provided such advice or directed my constituent to where to find it.

Another constituent, aged 82, paid for an assessment by Tivium that never came to pass, and all she is left with is an A4 sheet full of numbers. A third constituent—she has recently lost her job, making the situation all the more difficult for her—paid for two assessments on two properties, putting her out of pocket by £598. She has had “constant excuses”, followed by silence from Tivium. I wrote to Tivium’s managing director on 7 January on behalf of that constituent, and I have received no reply. That is not only discourteous, but the collection of stories is despicable and the situations are tantamount to theft.

To give some context, Broadland district council, via its very capable portfolio holder for environmental excellence, Councillor John Fisher, has given me comparable prices for a green deal assessment. He said:

“We have negotiated with our Providers to charge £65 for the same product/service via the ‘Warm Up Broadland & South Norfolk’ Green Deal Communities scheme. Our main provider charges £95 for a full Green Deal Assessment Report to anyone across the county.”

That puts the prices that Tivium charges in context, but the point is this: a consumer needs their product. If they do not get their product, they have been defrauded or stolen from. I have, of course, reported the firm to trading standards and contacted Stroma, which administers the green deal, for further investigation. Norfolk county council trading standards service has told me that it is monitoring Tivium and that Gateshead trading standards service is investigating the company, which has 84 county court judgements against it. Trading standards advises my constituents to contact the Citizens Advice consumer helpline, which has information available for victims of Tivium. It is also asking some of them to provide witness statements.

The Trading Standards Institute is concerned that

“there are other businesses using similar tactics”

to Tivium, and I know that it has acted in concert with the Minister’s colleague, the Under-Secretary of State for Energy and Climate Change, my hon. Friend the Member for Hastings and Rye (Amber Rudd), to try to make the issue clear. Tivium would be an example of the Trading Standards Institute’s concern about lead generators having inserted themselves into the supply chain in a way that could encourage mis-selling or over-selling, where consumers have to place heavy reliance on the information given by sales representatives. The TSI and the ombudsman services also express another concern that I am sure the Minister is aware of, which is the gap in protection where those who have an assessment done and take out no further package have no redress via the green deal ombudsman.

As should come as no surprise to any Member of Parliament who seeks to assist their constituents and take up their concerns, I think this behaviour is despicable. It is unacceptable, illicit behaviour that requires the strongest possible response, whether from trading standards or, if sufficient evidence can be gathered, through the justice system. It is not acceptable for elderly and vulnerable people in particular—they may well be considering putting hard-earned savings into good products and a good scheme that should help them to better insulate their home and go greener, which also helps broader society—to be defrauded of their savings and left out of pocket, feeling ashamed and worried that the same could happen again and again if the problem is not corrected.

To sum up, I am asking the Minister for three things: first, to explain what procedures are currently in place to protect consumers from both nuisance calls and rogue trading; secondly, to advise me of what action is available to my constituents to reclaim money that has been taken on false premises; and thirdly, to explain his thoughts on what needs to be improved to protect the public better from such traders, given that the Trading Standards Institute estimates that similar consumer complaints have gone up by 10% in the past 12 months. I do not want to see more Norwich people insulted, defrauded or ripped off, and nor, I think, does the Minister. I would be grateful for his advice on the three questions that I have posed, and I am confident that he will join me in utterly condemning the behaviour that I have described for my constituents, which I imagine is repeated elsewhere in the country.

[The Minister of State, Department of Energy and Climate Change (Matthew Hancock)]

It is a pleasure to serve under your chairmanship, Mr Streeter. I am grateful to my hon. Friend the Member for Norwich North (Chloe Smith) for securing this debate on such an important issue. It shows that she is a powerful voice for her constituency, working with her constituents to stand up to those who engage in disreputable and unacceptable behaviour, and that the people of the northern part of Norwich who are treated badly on the phone should expect that their MP will come to their aid and ensure that the company in question is brought to account. It also raises an important issue that, as my hon. Friend says, is a problem not only in Norwich but across the nation.

Whenever we deliver a Government scheme, we think about how it can support consumer interests and how to protect consumers from people who would misuse such a scheme. I will come to the wider issues relating to the Telephone Preference Service, but first I want to discuss the green deal, which is a positive programme. We have had almost half a million assessments, around three quarters of which lead to people either making improvements or planning to make improvements to their properties to bring about energy efficiency savings that can be paid for through the reduced cost of energy bills. It is a successful programme—alongside the energy companies obligation—that is funded through bill payers, and it is rolling forward with a great, regular momentum throughout the country. I am glad that my hon. Friend supports it.

People must be able to use the green deal with confidence and trust, so we have a robust authorisation process for all green deal participants, with a comprehensive monitoring and compliance structure that sets out clearly the roles and responsibilities for all involved. Authorised participants must abide by a code of practice and comply with the green deal quality mark, which must be used on the marketing material of all green deal assessors, providers, installers and certification bodies. Organisations that are not authorised to trade as a green deal participant and work outside the framework and code of practice must be dealt with in exactly the same way as any other commercial rogue trader, and the company referred to by my hon. Friend is a rogue trader.

The green deal code and attached conditions state that cold calling telephone numbers that are registered with the TPS because those households do not want to be cold called is not permitted. The TPS is an important part of having a telephone directory and the phone system, because it ensures that people who do not want nuisance calls do not get them. I will come later to the wider issue of nuisance calls.

Where legislation has been breached, it is for trading standards to be the enforcement agency for the relevant consumer protection law and its related regulations. In the past month, the Under-Secretary of State for Energy and Climate Change, my hon. Friend the Member for Hastings and Rye (Amber Rudd), has written to the chairman of the Association of Chief Trading Standards Officers to ensure that appropriate resources have been made available so that cases against rogue traders, particularly those who associate themselves with the green deal, are investigated thoroughly in a timely fashion. We have also sent out a joint communication with the chairman of the Association of Chief Trading Standards Officers to remind green deal market participants that it is their responsibility to uphold the green deal framework and ensure that there is protection for all parties. I am happy to share that information with my hon. Friend the Member for Norwich North and others.

The central point of this debate is that we must deal with companies that purport to be green deal participants but do not abide by the code. My hon. Friend mentioned a number of complaints about Tivium that she has received from her constituents—we have received a great deal of ministerial correspondence, including hundreds of cases throughout the country. It is totally unacceptable. Gateshead trading standards is currently leading an investigation into Tivium’s purported green deal activities. Along with the Financial Conduct Authority, we in the Department of Energy and Climate Change are supporting trading standards. I am sure that my hon. Friend understands that I cannot go into that ongoing investigation, but she should be in no doubt that where unacceptable behaviour has occurred, we will do everything we can to stamp it out. We want to protect the green deal’s integrity and reputation from rogue traders who have nothing to do with it and are simply behaving unacceptably.

It is worth mentioning that there have been a number of different cases, including one that concluded last month at Cardiff Crown court. The defendants were sentenced under consumer protection and unfair trading regulations for mis-selling the green deal scheme, failure to provide the correct cancellation rights and the unauthorised use of trade body logos. That shows that where organisations behave in such a manner, they will face prosecution. I hope that acts as a strong deterrent going forward and demonstrates that such behaviour is unacceptable.

[Chloe Smith]

I mentioned earlier that Norfolk county council trading standards told me that Tivium has 84 county court judgments against it, but I did not mention the second part of the sentence, which states that only three have been satisfied. While the Minister is talking about gaining redress through the courts, will he say how redress can be gained once a judgment has been issued and procedures need to be fulfilled?

[Matthew Hancock]

There is provision in the legislation to ensure that enforcement occurs. I would also add that the Information Commissioner’s Office has successfully prosecuted Tivium Ltd, and we are now in discussions about tackling the wider problem. The message from the Government for companies that are engaged in this sort of activity is absolutely crystal clear: “We will come after you, and you will not benefit from ripping off people across the country and purporting to be that which you are not.” As my hon. Friend said, it is tantamount to theft to require payment but not deliver anything in return. I can see her argument; she put the case powerfully. The appropriate place for prosecutions is within the structure that has already been set up. My hon. Friend asked what her constituents should do in these sorts of circumstances. Trading standards bodies are the best first port of call. They are co-ordinating nationally to ensure that Gateshead trading standards has all the necessary information.

On the wider issue of the Telephone Preference Service, we are working hard with the Information Commissioner’s Office—including meeting this week—to ensure that phone users’ rights in relation to the TPS are protected. That is part of a much wider cross-Government action. Last year, we put in place the action plan for nuisance calls. We consulted on various options from across Government to tackle the problem of nuisance calls, and we reported in December 2014 on the actions that need to be taken by Government, by regulators, by civil society and by companies. The nuisance calls action plan simplified how Ofcom can share information with the Information Commissioner’s Office and the Insolvency Service on rogue companies.

Which? did a review of how consumers agree to receive calls from specific firms: they do not want general cold calls, but do want calls from specific firms. The Ministry of Justice has strengthened regulations regarding companies that breach the rules on nuisance calls, so there is a cross-Government action plan to ensure we are putting in place a robust framework to tackle nuisance calls. I will be happy to talk in more detail about that comprehensive plan, but it is vital that it is taken forward across Government and regulators, and also more broadly, to ensure that the problem is tackled at root.

[Chloe Smith]

I am aware of the action plan and pleased to hear the seriousness with which the Government take it. Will the Minister reflect on the problem of the ability of unscrupulous firms to call with a name that sounds plausible—for instance, the Energy Awareness Centre, Solar Panels Ltd or some other phrase constructed using familiar words? The name sounds about right, but is absolutely untraceable. The TPS has noted this on its website, where it has advice about how to tackle unwanted calls. Perhaps the Minister will reflect on the traceability question.

[Matthew Hancock]

I will certainly reflect on it. As with other behaviour that is without the rules, people can be ingenious in attempting to find new ways to break the rules. It is difficult to solve this problem once and for all, but I have no doubt that more action, as set out in the action plan, will help to tackle it. I am sure my hon. Friend will agree that we must keep up the pressure on the nuisance call action plan.

I want to assure my hon. Friend and all Members that we are doing all that we can to make sure rogue traders do not get away with mis-selling on the green deal, and, crucially, do not rip off consumers. There is always more that can be done, but we need to tackle the nuisance calls and such activity in a way that also allows us to promote and enhance the offer to the law-abiding, the responsible, and the companies that provide the green deal. They do so with a social conscience, in the best possible way, to help people reduce carbon emissions and their energy bills. Ultimately, this is an important area of policy to get right, and the public need to have confidence.

Finally, on the point about the names sounding plausible, there is a public list of authorised green deal participants for this specific area, which is searchable online, so consumers can verify and identify companies. The Department is working on making sure that more people know they can verify a green deal provider and check that the people they are doing business with have got a good track record. The internet is a very helpful tool for people to be able to do this in an unobtrusive and straightforward way. I hope that my hon. Friend will also continue to engage in the whole process, which is very important, of making sure that more and more people know who the good traders are. We must promote the good traders as well as tackling the rogue traders, and I look forward to working with her on that.

Question put and agreed to.