Ticket Abuse

Clive Efford Excerpts

Tuesday 21st January 2014 Westminster Hall

[Mrs Hodgson]

It should be enforced in the same way as we enforced the regulations on Olympics ticketing. Tickets could be sold abroad under different rules, but the number of tickets held here that had to go to UK fans had to follow UK legislation and the laws that we made.

[Clive Efford (Eltham) (Lab)]

Does my hon. Friend agree that if the details of tickets were provided to the organising body and they were being sold illegally, it could then cancel them? That information would be important in enforcing the proposal.

[Mrs Hodgson]

My hon. Friend is right. That already happens with some events, including those at the O2. If a ticket is found to have been resold illegally and can be traced, it can be cancelled. That is one mechanism that can be used. My proposal would give consumers the peace of mind that they will not be left out of pocket if they are the victim of ticket fraud. The websites that make money facilitating ticket touting say they currently aim to make that happen now, so I hope that my proposal will not be considered too much of a stretch.

To bring to the market the much-needed transparency that the police and many others say is needed, the websites should ensure that all ticket listings display the face value and seat number, where appropriate, of the tickets being purchased. That would prove that the tickets were real and already in existence. Websites selling tickets they have acquired themselves, or through direct allocations from an event holder, should disclose that clearly to buyers, and individuals selling tickets via these websites should be able to provide proof that they own the ticket they are selling.

EBay was probably the original platform for web-based touts. The main websites these days could learn a lot from the information about a seller that it allows to be seen. EBay no longer allows tickets to be sold; that part of its activity has been moved to StubHub, through which it makes commission from the buyer and seller. However, providing information could still apply to other listings, so that the number of tickets sold to other events, the number currently for sale, feedback from previous purchasers, and the record of any previous accounts held by the individual when possible could be detailed. That would allow consumers to make an informed choice about whether to buy from a tout who sells hundreds of tickets, or from a genuine fan who is selling tickets because they cannot go to the gig or event.

There is a serious problem with how some touts acquire tickets through the use of botnets and sophisticated software programmes to circumvent restrictions placed on sales by primary ticketing websites, but that is arguably more a case of detection and properly enforcing existing laws and regulations, rather than making new ones.

The secondary websites have a role to play in questioning the legality of the methods employed by their power sellers to acquire the vast inventories that some of them have. I hope that that will be explored more during the APPG’s inquiry.

I have given the Minister and the other Members here a lot to think about this afternoon, but I hope she will try to respond to as many of the different points as possible. If she cannot, I hope she will simply tell the House whether she thinks her Government should carry on entrenching and exacerbating the situation. Even the chair of the Association of Secondary Ticketing Agents admits that

“the ordinary fan is screwed. The decks are stacked against them.”

Please do not say that the previous Government and the Select Committee looked at this issue years ago, so it is all okay. I have spent the past 30 minutes explaining why that just does not wash any more and why everything that has happened in the past six years shows that the wrong decisions were made.

I could have spent much longer speaking, but I will not. I have had lots of material sent to me over the past few years, which I will present to Parliament in due course to back up the case. If, as I hope, the Minister does not want her Government to reach the end of their tenure having made the same mistakes, I will be delighted to work with her and colleagues from all parts of the House to come up with a solution that tips the balance back in favour of the fans.

As I have said before in debates on this subject, tickets give access to an experience—sometimes, a once-in-a-lifetime experience—and the normal market rules of supply and demand do not apply. The tickets should not go just to those with the deepest pockets, access to back-channel deals or criminal methods of acquiring them, unless that is what the person putting on the event wants. The Government’s job is to legislate to prevent such market failure and to ensure as far as possible that everyone has a fair and equal chance of purchasing a ticket to their dream event, at the price those putting on the event intended.

--- Later in debate ---

[Clive Efford (Eltham) (Lab)]

It is a pleasure to take part in this debate under your chairmanship, Mr Crausby. I start by paying tribute to my hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson). She has been a tireless campaigner on the matter and is determined to protect the consumer, who is frequently ripped off by people exploiting the secondary ticketing market.

We need to get one or two things clear at the start. No one is suggesting that people should not be able to resell their tickets if they have a legitimate reason to do so, such as if they are unable to attend an event. We have all been in similar situations. The viagogo figure of 50% of tickets being sold for their face value or less arises because many people use the secondary ticketing market to try to minimise their losses when they cannot attend events. They did not necessarily buy tickets with the intention of making a profit and fail to sell them on.

We must have a robust secondary ticketing market that is properly regulated and that gives consumers protection. The secondary ticketing market must also allow organisers to monitor what is going on. The hon. Member for Shipley (Philip Davies) said that if somebody buys a ticket, they own the rights to it and can do what they like with it, but that is not true. When someone buys a ticket, they enter into a contract with the organiser. In many instances, the organiser makes stipulations regarding the selling on of tickets, which must be honoured. The ticketing market must be regulated and provide that information so that organisers can check ticket details at the point of sale. Let us face it; there is no other form of retail in which a consumer cannot examine the full details of a product. Rugby union made a challenge against viagogo on that basis, to try to secure access to such information.

We must protect the consumer against organised gangs of touts. The hon. Members for High Peak (Andrew Bingham), for Bury North (Mr Nuttall) and for Shipley made passionate speeches in favour of the free market. I have had various descriptions of redistribution of wealth thrust at me, but that given by the hon. Member for Shipley was a new one on me. He did not mention the link between crime and many instances in which people hoover up large numbers of tickets and sell them on. Presumably, he sees bank robbery as a form of redistribution of wealth and considers any form of crime that takes from the rich and gives to the poor to be justifiable in terms of the free market.

At the moment, 14 sets of tickets for the rugby world cup are available on the viagogo site. Tickets for that event will not even go on sale until autumn of next year, and the tournament will take place a year after that. When people do not even own those tickets yet, how can they be offering them for sale? The tickets on offer range from £86 to £10,000, and the two £10,000 tickets carry a £3,000 surcharge to cover the ticket guarantee and customer service. I would have thought that that was well and truly covered in the £10,000 price. What sort of extra cover could anyone need from viagogo to get a ticket guarantee? I would expect that to be part of the deal, but it is obviously not. People who use such sites are subject to some dubious additional charges, which is another area of concern.

The police inform us that touts are often linked to criminal gangs, and touting is estimated to raise some £40 million a year for organised criminal networks. The report “Ticket Crime: Problem Profile” published by the Metropolitan police in February 2013 states:

“Intelligence suggests that OCNs engaged in ticket crime have links to other organised crime, including the importation and production of drugs, as well as the smuggling of firearms and money laundering.”

We have heard impassioned pleas for a free market that facilitates such criminal activity, which is totally irresponsible and unjustifiable. Criminal gangs are well equipped, as my hon. Friend has set out, to hoover up tickets through networks of computers, botnets and so on ahead of genuine fans—the hon. Member for Shipley is no doubt wriggling in his seat at the mention of those words—whom they will force to pay extortionately high prices for those tickets.

I wrote to the Minister to ask that the rugby world cup, like the 2012 Olympics and Paralympics, be given a specific designation as an event of national significance to protect rugby fans. The organisers of the rugby world cup have priced their tickets to make them accessible to a range of fans, and they want to be able to resell returned tickets at face value through their own ticketing regime and reimburse the original purchasers. They want fans to be able to buy tickets at affordable prices so that a good cross-section of our communities and sports fans attend the events. What is wrong with that? Inevitably, however, criminal organisations and people who, even if they are not involved in criminal gangs, attempt to avoid paying tax on the profits that they earn from reselling tickets will buy tickets from under the noses of the fans. In so doing, they will completely undermine the ticketing policy that we, as politicians, have demanded of the England rugby world cup 2015 to try to ensure that tickets are accessible.

In my letter to the Minister, I asked for co-operation across the House to pass legislation to protect rugby fans from such exploitation. In her response, she mentions a consultation by the previous Government on ticketing. She states that the responses were broadly in line with the findings of the report by the Culture, Media and Sport Committee in 2008, and says that the consultation found that the biggest issue with regard to ticket resale concerned the practice of purchasing large numbers of tickets with the sole intention of releasing them back into the secondary market. That is exactly the point that we were raising, and we did not need it to be reiterated. She went on to say that the Department had looked at the Select Committee findings and the conclusions of the previous Government, and that it was broadly in agreement.

Time has moved on, and the Metropolitan police report that I have referred to states:

“The absence of a regulatory or legislative framework (apart from designated football matches) enables fraud, unscrupulous practices and a lack of transparency. This clearly places the public at risk. This matter was last considered by a Culture, Media and Sport select committee report in 2007.”

I think that report was actually in 2008. The Metropolitan police report continues:

“It is noted that, since then, the Internet has grown exponentially providing even more opportunities for fraudsters and unauthorised sellers to exploit.”

The Metropolitan police force has conducted a serious study into this area of operation since the 2012 Olympics and since the Select Committee’s report, and it has reached the conclusion that something needs to happen. The Metropolitan police report later states that there is a “lack of legislation outlawing” the practice.

In 2005, the then shadow Minister, the right hon. Member for Faversham and Mid Kent (Hugh Robertson), who became the Minister for Sport and the Olympics, said that ticket touting had a “knock-on effect” on the availability of tickets for real fans, and that

“ticket touting is now part of a vast organised criminal business.”—[Official Report, Standing Committee D, 18 October 2005; c. 101.]

When the Government were in opposition, they put forward exactly the same arguments as we are making today. Those arguments apply even more so now with the advancement of the secondary ticketing market on the internet.

I welcome the Minister’s offer of a meeting to discuss the issue. We can wait for legislation—I am sure that we will have detailed discussions about secondary ticketing market regulation when the consumer protection Bill is introduced—but when we meet, will the Minister guarantee that we will sit down and talk about how we will designate the rugby union world cup 2015 in order to protect fans from being exploited in the secondary ticketing market on the internet?