Consumer Rights Bill

Debate between Chris Kelly and Sheila Gilmore

Tuesday 28th January 2014 Commons Chamber

[Sheila Gilmore (Edinburgh East) (Lab)]

The hon. Member for South Thanet (Laura Sandys) said that she had previously worked for the Consumers Association. Earlier in my career I worked for the Scottish Consumer Council. It is important to recognise that Governments of all colours have wanted to strengthen in various ways the rights of consumers. The National Consumer Council and its Scottish and Welsh equivalents were set up by the Labour Government of the 1970s, so everyone has aspired to putting the consumer at the heart of things. The problem sometimes is how to make that a reality for those consumers. How can we ensure that people understand how to use the rights that they are given?

People often encounter the greatest difficulty when dealing with smaller retailers, because in larger companies staff are generally better trained and so better able to respond. Indeed, some larger retailers would rather allow the consumer to go away happy, even if that means going beyond the basic statutory minimum. Many smaller retailers, however, either seem unaware of what the law states or deliberately obfuscate when a consumer complains. They say, “You have to go to the manufacturer for that,” even though that has not been the case for many years.

Citizens Advice has suggested amending the Bill—perhaps the Minister will consider this—to make it a requirement that information on consumer rights is provided at the point of sale. It has made some suggestions on how such information could be presented, because it is aware that it could be quite difficult to convey simply. I think that that information, whether it is on a notice in the shop or on the till receipt, would be helpful, as consumers would be clear about what to do if something goes wrong.

Another relatively minor amendment that Citizens Advice proposes is including a time limit for repairs and replacements. I remember what things used to be like, when I had to try to explain to people what was going on with repairs, when they could get a refund and whether accepting a repair put them in a difficult position. The simplification is to be welcomed. However, the question remains whether there should be a limit on the time a company can take to repair and return a product. Citizens Advice suggests a 30-day limit. I would like to know whether the Minister will consider such a change.

Services have always been more difficult to regulate than goods—when we buy an object, it is much clearer what we are buying. The relevant legal wording, which effectively requires one to make a judgment on whether reasonable care and skill has been used in the performance of the service, has always been quite difficult. It is good to have that made explicit, rather than implicit. It is not an implied term; it is to be taken as an expressed term in the provision of services. However, that still leaves open the question of precisely what that means. Could it be measured in some way?

I was interested to hear what the Chair of the Business, Innovation and Skills Committee, my hon. Friend the Member for West Bromwich West (Mr Bailey), had to say on that and about the Committee’s recommendation. I hope that it can be explored more fully to see whether other measures could be used, at least in relation to some services, to give a clearer and more explicit measure of whether a service has been performed in the way it should have been, rather than having to rely on a debate on what is a reasonable level of skill.

Ultimately, we must also look at how people exercise their rights. Ideally, they should be able to exercise them face to face with the person providing the service or selling the goods. Things should be sufficiently clear that the consumer can go back, exercise their rights and get a good response, but we know that that does not always happen. We must therefore look at the means by which people can get redress.

Citizens Advice also wants the Government to consider the question of collective redress in relation to competition cases—if there is a particular kind of mis-selling or product or service failure—that affect not just individuals, but people in particular localities or up and down the country, and on which a collective response is available, because there is strength in numbers.

Although allowing an individual consumer to have all their rights and choices is clearly important, they are sometimes a small cog in the wheel, and it can be very difficult for them to push a case. Many people simply give up, because it is not worth the effort: if they are rebuffed at first, they will not necessarily pursue their case further, because they do not know how to do so or find the whole process so difficult.

Even for people who contemplate going to court, the process can be quite expensive. Other hon. Members have spoken about the difficulty of getting legal aid to go to court or even for legal advice. A court fee can be a considerable block to people’s ability to exercise their right. For example, in Scotland, an action for a small claim can be made for something worth more than £200, which is not a huge amount in relation to various consumer purchases, but it costs £71, which is quite a lot for someone to risk if they feel that they might not win the case. We therefore have to consider the whole idea of redress.

When I was involved with the Scottish Consumer Council, we did much work on developing proper small claims courts to which people could easily go, be represented and get a lot of help. There is still merit in trying to develop such an approach, rather than people feeling that their case cannot be taken forward. That is where the collective becomes important. For one individual, the cost and effort of pursuing a case will be great. As my hon. Friend the Member for Inverclyde (Mr McKenzie) said, even in relation to what seem very small amounts—less than a fiver—such amounts add up and, collectively, it should be possible to put such cases together.

I share the concern expressed by my hon. Friend the Member for Walthamstow (Stella Creasy) that no one wants a book of law of huge size, as was suggested by the hon. Member for Eastleigh (Mike Thornton), but this is an opportunity to legislate on some of the issues that hon. Members raise time and again because of their constituents’ experiences. Various people are campaigning on many of the issues, because they understand the detriment that people are suffering. This seems to be an opportunity to legislate, and it is sometimes important to legislate. Rather than end up with smaller pieces of legislation in future, which would recreate the difficulty that we now have in consumer legislation, we could take the opportunity of having this Bill to consider some of the issues.

My geographical, if not adjacent neighbour or political colleague, the hon. Member for Edinburgh West (Mike Crockart), has pursued the issue of nuisance calls. With other hon. Members, he has made some progress in highlighting that important subject. Nuisance calls are an irritant to those of us who thought that we were on the Telephone Preference Service, but still get calls that we are told are for research or some other spurious reason, or calls where only one in 20 people who have been rung is spoken to when they answer.

That is an irritant for those of us who cope with that sort of thing very or reasonably well, but it can be worse than an irritant for others. My father, who is now in his 90s, has got to the stage where he hardly ever answers the phone, which is not particularly practical. He certainly will not answer the phone if it is an unknown number. As Members will know, if somebody phones from an institution, such as this place, it comes up as an unknown number. He is not only exasperated by such phone calls, but anxious about answering the phone. It is highly harmful that nuisance calls are being made and it is important that we legislate to deal with them.

[Chris Kelly]

Has the hon. Lady found, as I have, that this matter is of particular concern to our older constituents because they tend to rely more on landlines than any other age group? Many young people do not have a landline or have one only for broadband services and use their mobile phone for incoming calls. They are therefore not affected in the same way as many older people.

[Sheila Gilmore]

That is correct. I suspect that that may be a reason why older people get so many nuisance calls.

A related concern, particularly for less well-off consumers, is the phone numbers that are used. When I tried to pay my electricity bill by calling from my mobile phone, because that was the most convenient way for me to call, there was a message to say that I would be charged if I called that kind of number. I put the phone down and made a mental note to call from a landline. That probably led to a delay in the bill being paid. However, some people would find it very difficult to call from a landline and so would be charged a premium.

Government Departments are not immune from the problem of premium rate numbers. It is a major issue for many people that the Department for Work and Pensions still uses numbers that cost them a lot of money when they phone in for information, to report changes in circumstances or to change an appointment because they cannot attend. We need to look at that problem. People should not be charged—sometimes they do not even realise that they are being charged—to engage with a private firm that is selling them goods or services, or with a public agency.

I hope that the Bill has room to cover the problem that less well-off consumers and older consumers often pay more for their utilities than the rest of us, which the hon. Member for Harlow (Robert Halfon) and I have raised. I think that he was planning to seek a debate on that issue at the Backbench Business Committee this afternoon, because he has approached various Members for support. It is one thing for companies to say that direct debits are so much more convenient and cheaper to process than other forms of payment that they will give direct debit consumers a discount and everybody else will pay a standard charge, but companies have gone beyond that and are making other customers pay an additional charge. Not only energy companies but organisations such as BT are charging people a £6 fee to pay via PayPoint.

The constituent who brought that issue to my attention did so on behalf of her elderly uncle, who was insistent that he wanted to pay in that way. He had always managed his finances in cash and was going to go on doing so. He could no longer use certain methods that he had used before and the only way in which he could pay by cash was to use PayPoint. It is not only people on low incomes who are affected, but such people are more likely to use the cash economy and can be wary of banks.

I was talking recently to one of the housing associations that took part in the pilots set up by the Department for Work and Pensions for the direct payment of housing benefit. The DWP would like people to get bank accounts and pay by direct debit, and that would certainly help housing associations as well, because it would help people to be responsible for their own payments. The problem that the housing association found was that a lot of its tenants were not comfortable with doing that, either because they had had bad experiences of being charged because their direct debit went out at the wrong time of the month or because they knew people who had. They preferred to pay when they wanted to pay, preferably in cash or through some other payment mechanism. They were not keen on banks and direct debits, even if they could get a bank account, which still not everybody can. We must think about the aspects of the system that harm the least well-off consumers as well as competent and able consumers. It would be helpful if room could be found in the Bill for some of those issues.