Delivery Surcharges (Transparency for Consumers) Bill

Christopher Chope Excerpts

Friday 13th September 2013 Commons Chamber

[Sir Robert Smith]

The Bill requires the Government to state in the regulations the penalties that would be applied. They would obviously have to consult on that during the process of drawing up the regulations. One penalty might be a requirement to comply, and to place the details of the charges on the website so that they are established and clear.

Members will be reassured to learn that I have opted for the affirmative process. Any regulations that are produced as a result of the Bill will have to be debated and voted on in the House, so that Members can scrutinise them in detail. We do not want to impose excessive regulation or unnecessary burdens on industry. When the market is failing, giving more information to consumers can help it to become more focused and effective and to deliver a better deal to consumers, while also ensuring that retailers can sell their products in a competitive market.

[Mr Christopher Chope (Christchurch) (Con)]

The Bill is confined to online retailers. What about ordinary retailers? If someone goes into, say, John Lewis and orders some goods, the shop assistant will not say at the outset “Where do you live? If you live in X it will cost you Y.” The transaction will continue, and at the end of it the assistant will ask for the customer’s name and address, and will say “If you live in the highlands and islands, there will be a delivery surcharge.” Why should an online retailer have to say in advance what the costs will be?

[Sir Robert Smith]

Because it is much easier to ask about delivery in the shop. The nature of the exchange is more fluid. The customer can set the agenda and get the information they want before purchasing, whereas online, the information is not available until the end of the transaction. The online customer will have put in a lot of effort to get to that point of the maze and, having been led all that way, will feel immense frustration and anger at being clobbered at the end of the process. This problem has also been dealt with for airline bookings and credit card charges. They were being whacked on at the very end of the process, but now airlines have to be more upfront and be realistic about the charges.

I want to thank the Members who have supported the Bill: my right hon. Friends the Members for Gordon (Sir Malcolm Bruce) and for Ross, Skye and Lochaber (Mr Kennedy), my hon. Friends the Members for Caithness, Sutherland and Easter Ross and for Argyll and Bute (Mr Reid) and the hon. Members for Aberdeen North (Mr Doran), for Aberdeen South (Dame Anne Begg), for Angus (Mr Weir), for Na h-Eileanan an Iar (Mr MacNeil), for Isle of Wight (Mr Turner) and for Banff and Buchan (Dr Whiteford). This is an extensive problem affecting large parts of the United Kingdom, mainly in the highlands and the north of Scotland but also extending down to the borders and the islands of England—the Isle of Wight, the Channel Islands, the Isles of Scilly.

The Bill must be part of a wider awareness-raising process, because the retailers need to be more focused. They are thinking of the vast majority of their customers when they think of a delivery system, and they are not shopping around for one that will deal with those at the margins. Many retailers should consider using Royal Mail’s universal service delivery products for those areas that cannot be served by couriers. Bringing retailers together and shining a spotlight on this issue will help them to understand the frustration that is felt. The Bill would end that frustration and I commend it to the House.

--- Later in debate ---

[Mr Christopher Chope (Christchurch) (Con)]

This is an example of a private Member’s Bill that is well suited to raising the issue, having a proper discussion and getting a response from a Minister. I note that the Minister offered to have a delivery charges summit under her chairmanship. I hope that the promoter of the Bill thinks that that will be a sufficient reward for having been successful in the private Member’s Bill ballot.

I do not think that introducing new regulations with criminal sanctions against those who break the regulations is the way to improve matters. Of course, by shopping online one probably undermines the viability of many of one’s own local retailers, and if we want to campaign for small shops in rural areas we do not necessarily want to encourage people to engage in online retail. However, I do not think that there is anywhere in the retail world that is more competitive than online. I recently visited a shop in Christchurch that supplements direct retail with online retail. The proprietor told me about a product called “Bananarama”. Unless the shop is the cheapest online retailer of that product, they will not make any sales. The proprietor showed me at least 20 or 30 examples of where the product was available for sale, and the cut-throat way in which it was being sold. That shows the benefits of healthy competition. If an online retailer is alienating his customers by not providing clear information about delivery charges, then he is unlikely to stay in business for very long.

[Andrew Selous (South West Bedfordshire) (Con)]

Will my hon. Friend enlighten the House as to what “Bananarama” is?

[Mr Chope]

“Bananarama” is a sophisticated form of Scrabble, which comes in a small package. I think the pieces are yellow, but that is enough publicity for that product.

The Bill is an example of where people come forward and say, “There is a problem, therefore we must have more legislation”, but are we really going to start penalising online retailers by saying that if they do not provide all the information upfront as soon as the customer clicks on to their website, they will be subject to a criminal assessment? Apart from anything else, common sense dictates that it is only at the end of a transaction that one knows the bulk and scale of the products ordered. The retailer may offer a range of different products, some of which can be delivered by Royal Mail and some that might need to be transported by an elephant. It is only at the end of the transaction that the online retailer will be in a position to say what will be a reasonable charge.

The Bill, therefore, is completely over the top. It states that the Government would have to introduce regulations, thereby transferring responsibility for drafting from my hon. Friend the Member for West Aberdeenshire and Kincardine (Sir Robert Smith) to the Government. I just wonder how the Government would ever be able to introduce regulations requiring online retailers to include a clear statement of, for example, “a reasonable indication” of the total cost. What do we mean by “a reasonable indication”? Do we mean an approximate indication or a reasonable guess?

The Bill is riddled with anomalies and problems. I have always been a great believer in putting bad legislation out of its misery at the earliest possible stage, so I have no compunction in saying that I will be doing the House a great service if I ensure that the Bill does not have its Second Reading. It is ill-conceived and the wrong way to address the problem. I do not represent a rural constituency, but there are a lot of online retailers and they do not want to be burdened with the excessive regulations proposed in the Bill. Apart from anything else, and as so often happens with such proposed legislation, it would be counter-productive. Clause 1 requires that the online retailer sets out what the charges will be. An outline retailer would be able to avoid all the burden of this Bill by saying at the beginning that it did not sell goods to islands in Scotland or England, such as the Isles of Scilly or the highlands and islands, or the Isle of Man. That could be counter-productive, because people who live in those more remote areas want to have access to goods, but they recognise that the other side of the coin of living in a remote rural area is that delivery charges are higher. I do not think that anyone has suggested yet in this debate, and perhaps in due course they will, that there should be cross-subsidy of those—