Lord Clement-Jones
Main Page: Lord Clement-Jones (Liberal Democrat - Life peer)Consumer Rights Bill
Lord Clement-Jones Excerpts(9 years, 7 months ago)
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Lord Hodgson of Astley Abbotts
My Lords, this amendment appears to be sticking one’s head in the lion’s mouth, in that it appears at first sight to be an amendment in favour of double-glazing salesmen. Like many Members of the Committee, I have seen examples on various consumer protection programmes where the behaviour has been completely unacceptable. Before Members switch off completely, though, I wonder whether they will bear with me while I drill down a bit into the issue. There have been egregious examples of fly-by-night double-glazing operators but equally there are many reputable firms, some of which offer guarantees as long as 10 years for the performance of their products. It is of course also worth being aware that double-glazing plays an important part in improving the insulation of people’s homes and in the fight against global warming. Therefore this industry has an important commercial role to play in our society. However, the nature of its bespoke—I use the word carefully—way of working can make it the victim of the unscrupulous customer. I will explain briefly what I mean.
New double-glazed windows have to be custom-made. They have to be measured individually, and the new window is thereafter made appropriately. Under present regulations—the consumer contracts regulations; I am sure that the Minister will correct me if I have this wrong—if the windows are wrongly installed, the customer has, quite appropriately, the right to repair. If the repairs are unsatisfactory, the customer is entitled in the end to a discount on the price. Those remedies are of course reinforced in Clause 23: the “Right to repair or replacement”, or in Clause 24: the “Right to price reduction or final right to reject”. I think the industry, and others, would say that in so far as the new provisions do not repeal the existing consumer contracts regulations, we need to make sure that they mesh up and match precisely. The industry supports the provisions of Clauses 23 and 24, as my amendment makes clear.
The challenge to the industry comes from the provisions of Clause 20 and the apparent lack—I hope that the Minister will be able to reassure me on this—of any test of proportionality. If I may take an example, a customer might order a dozen windows to double-glaze his or her house. The windows are measured, manufactured, and fitted. At that point, the provisions of Clause 20 appear to give the customer almost any grounds for rejecting the goods and treating the contract as being at an end. There is no requirement, as I read it, to seek any remedial work before ending the contract. At this point, the supplier is of course in a very weak position. The fitted windows have no alternative use, as they have been specifically measured and made. Moreover, they now form part of the structure of the building, which makes their removal even more legally complex. Amendment 16 merely seeks to achieve some equality of arms, that this absolute unproportional right of rejection as in Clause 20 is limited where goods are personalised and have been installed in a building.
To conclude, this Bill is entitled “Consumer Rights Bill”, and I support its principles. However, not all consumers are angels; therefore there is a concern that without some protection of proportionality these firms may find themselves taken advantage of by the unscrupulous. In addition, of course, the better the firm, the greater the risk, because the fly-by-night operators who should be the focus of our regulatory efforts will by then be over the hills and far away. I beg to move.
Lord Clement-Jones (LD)
My Lords, I will briefly support the amendment in the name of the noble Lord, Lord Hodgson. He has made an even better case than the one that was presented to him in the first case. It struck me that in principle, if we set our minds to it, we could probably find quite a number of other areas apart from double-glazing, which was the example that the noble Lord gave, where goods are manufactured, bespoke, to a customer’s requirements. This particular case is very strong because of the construction work that is required to be done, which you cannot undo without serious damage to a property. I therefore hope that the Minister can give either clarification or assurance that something in the Bill deals with these kinds of made-to-measure products. A very valid point has been raised, and the noble Lord, Lord Hodgson, has put the case extremely well.
Baroness Hayter of Kentish Town
My Lords, the amendment as it is written, not necessarily as it is intended, is what concerns us. As written, it would undermine the right to reject. We do not see why a consumer should have any less of a remedy when something has been made to their specification than anything else. In fact, very often if it is made to their specification it may be particularly valuable, desired and even expensive. They certainly should not lose their rights just because of that. To some extent their rights should be stronger. because they have negotiated and explained exactly what it is that they want. As I was saying to the Minister earlier, I am wearing a made-to-measure garment.
Baroness King of Bow (Lab)
My Lords, Amendment 19 allows the period within which a consumer can exercise the short-term right to reject to be extended beyond 30 days when necessary to give the consumer sufficient time to assess the goods. In other words, the amendment is about limited flexibility and maintaining rights available to consumers under current law.
When the Law Commission recommended a 30-day period for a consumer to exercise the initial right to reject, it was on the basis that 30 days would be the “normal period” but that there would be flexibility in appropriate circumstances. The Bill recognises that some goods will typically perish within 30 days, and in those cases a 30-day right-to-reject period clearly is not appropriate. However, the Bill does not recognise that a longer period may be needed in some circumstances. Under current law, a consumer has a “reasonable” period within which to exercise the initial right to reject. The Law Commission recognised that for many purchases a court may consider a reasonable time to be longer than 30 days. We have some of the current case law, including the court finding it reasonable for a consumer to reject a new car after seven months. Presumably without this amendment a consumer would not have that protection from the courts. A more obvious example is a pregnant woman buying a pram before her baby’s birth or goods bought out of season—skis during the summer, lawnmowers in the winter, or the obvious Christmas present scenario.
Without the ability to extend the right to reject in such circumstances, consumers might be worse off under the Bill than under the current law, which allows that reasonable period. That is obviously our concern—and not just ours: apart from the Law Commission, the BIS Select Committee recommended that,
“the Government reconsider an exception to the time limit for the early right to reject where it is reasonably foreseeable that the consumer would need a longer period to inspect the goods and to try them out in practice”.
Amendment 19 would implement that recommendation. I beg to move.
Lord Clement-Jones
My Lords, I am intervening rather unfairly on this amendment to say that I do not support it and that, as the Bill’s passage carries on, a number of sectors will have their voices represented. I want to raise issues that have been raised with me by the motor sector, particularly the Finance and Leasing Association, which represents a wide range of those who finance the purchase of motor cars by consumers.
As we heard, Clause 22 introduces this 30-day right to reject goods if they are of unsatisfactory quality, however minor the defect. Sellers are unable to deduct the costs incurred—for example, depreciations—while the goods have been used by the consumer. As a result, the right to reject could have a particular cost implication in the world of motor finance, where 75% of private new car sales are bought on finance. New cars, as my noble friend may know, typically lose 15% to 20% of their value in the first 30 days, and in the event of a defect the car dealer will have to offer to repair the car, although the customer is not obliged to accept that and can simply opt to hand back the vehicle. In a worst-case scenario, as the FLA says, the customer might have had the car for a month and driven it extensively, clocking up thousands of miles, only to hand it back because of a very minor defect—for example, the windscreen wipers failing to work properly. That is the case that the FLA makes.
I am very happy for my noble friend to write, since this is a rather unexpected intervention. There is clearly a balance to be struck between ensuring that customers are able to return faulty goods and preventing potential abuse. I therefore ask my noble friend whether the department will clarify, in the accompanying guidance to the Bill and in any associated publicity, that this new short-term right to reject should be invoked only if the quality of the goods is genuinely unsatisfactory—that is, the defects are not simply minor mechanical or cosmetic ones—and ideally it should be done as soon as possible within the 30-day period.
Secondly, could my noble friend confirm how this new short-term right to reject fits with Section 75 of the Consumer Credit Act, which already allows the customer to make a claim against a supplier or lender for breach of contract? This Consumer Rights Bill gives the consumer a right to challenge the supplier, whereas Section 75 of the CCA establishes an additional right to pursue the creditor for breach by the supplier. Will the Government be making clear in the guidance that the customer must obtain recourse from the supplier first, and that the supplier must not renounce responsibility on the grounds of Section 75?
Baroness Jolly
My Lords, this amendment reflects a recommendation by the Law Commission in its 2009 report, Consumer Remedies for Faulty Goods. Many of the recommendations in that report are implemented in the goods chapter of the Bill. Indeed, a normal period of 30 days was recommended by the Law Commission as giving a reasonable opportunity for a consumer to inspect goods, as well as meeting the expectation of consumers. However, I am concerned that the amendment would undermine the benefits of certainty provided by the 30-day time limit for the short-term right to reject.
Here I am staying with the example of the pregnant lady buying a pram. Let us look at the example of a pregnant woman who buys baby equipment in preparation for the birth of her child. The amendment would allow her to exercise the short-term right to reject potentially months after purchasing the goods, should it transpire that they were faulty. On the face of it, that may seem fair, but I see many issues that could arise to make this impractical. If a friend who was not pregnant bought the same goods for the same unborn baby, it is not clear whether it would be reasonably foreseeable that there might be a delay before they were used. Should all baby-related goods be subject to a longer period for rejection because it is not unreasonable to think that they may be for a baby who has not yet been born? Or would this only be reasonably foreseeable if the consumer said something to indicate it, or had a sign, such as being pregnant?
If it was reasonably foreseeable that there may be a delay before the consumer would use the goods fully, it seems difficult to know what the reasonable period would be. Take the example of a consumer buying skis in the summer. What is the reasonable period for the consumer to be able to test them? A week into the European ski season, or a month? Not until the end of the season? How would the trader know when the consumer came to return the goods whether a delay was reasonably foreseeable when the consumer bought them? Would the trader have to keep a record of who bought what and any relevant circumstances, such as when they said they would start to use it? This would be extremely burdensome on businesses.
Lord Clement-Jones
(a) ”
Lord Clement-Jones
My Lords, I shall speak also to Amendment 20B. I am afraid that I am going to do exactly what the noble Baroness, Lady Hayter, did not want to do, which is to question the “one repair” point. I return to some of the concerns of the motor industry. The Society of Motor Manufacturers and Traders and the National Franchised Dealers Association have raised significant concerns over the wording of Clause 24 regarding “one repair” and the right to reject the product and demand a refund. These concerns are centred not on the principle of the right to repair or replacement itself but rather specifically on what “one repair” entails. This issue is of course particularly pertinent to the final right to reject in Clause 24.
At present the Bill does not specify what “one repair” would entail but the draft guidance states that one repair means a single attempt at repair and that the trader can offer further repairs and replacements, but only if the consumer agrees. Members of the motor industry and the trade seek clarity over the definition of “one repair”, and do not accept that the current status of the draft guidance provides a fair interpretation of what is really needed to give clarity. They point out that the notion of a single attempt at repair, as set out in the draft guidance, is problematic for highly complex consumer goods such as motor vehicles. They say that these complex products may show a fault that requires more than one repair, involving a series of visits to the garage so that the fault can be diagnosed and tested, and have causes ruled out. In addition, a repair may appear complete but the fault may reappear, as can be the case with electrical faults, and a second or subsequent repair may fix the problem. These issues are likely to become increasingly apparent as motor vehicles become even more technologically complex, as they have done over the past few years.
The amendment seeks to include a definition of “one repair” to permit a process of repair and provide traders and dealers with a fair opportunity to fix these complex goods. It is worth noting that the consumer will still be fully protected by the right to repair or replacement under the amendment, as the process of repair would still need to be completed within a reasonable time and without significant inconvenience to the consumer. I hope that at least meets the interest of my noble friend, as this is a matter of considerable concern. On the previous amendment to which I spoke while seeking further clarification on the guidance, I note that my noble friend answered the second point about the CCA but not the first: what clarification the guidance would give for minor defects. Perhaps my noble friend can write to me on that matter. In the mean time, I beg to move.
Baroness Hayter of Kentish Town
We think that the noble Lord has brought an interesting issue to the Committee; I do not know whether the Government find it such. However, we are unconvinced that this needs to be detailed in the Bill as suggested. The Bill simply states that repair means making the goods conform to the contract, which means making them deliver what was promised. I do not think that it says “at one go”. Obviously, we look forward to hearing what the Minister will say on that.
However, the Committee will not be surprised that our worry is that the danger of the new wording is to allow a trader to make more than one repair and then claim that it was simply different stages of the same job, whereas actually they may have tried this, that and then something else—and want another go if they did not do it at first. I recognise that that is not what the noble Lord, Lord Clement-Jones, is aiming at, but the wording might allow for that. It is exactly to avoid such situations where consumers are fobbed off by a number of unsuccessful repairs before they can move to the next stage that we like the clarity of the Bill and would not want it jeopardised by these amendments, no matter how well-intentioned they might be.
As we are into personal stories, such as my clothes, let us take my new car. Of course, it got a great big problem and I took it back to Nick but rather than opening the bonnet all he did was to put a computer on top of the car, which seemed to tell him what was wrong. I do not know how that worked but 55 minutes later it was completely mended. Cars, which I no longer understand even if I once did, may be more complex but one does not want to have to keep going back to the trader. We worry that the amendment would lose the clarity that there is in the Bill.
Lord Clement-Jones
My Lords, I thank my noble friend for her response, rather negative though it was. I suspect that to some degree we are victims of our own personal experiences in this respect. The noble Lord, Lord Borwick, whose support I am grateful for, has had some unfortunate experiences from a business point of view; on the other hand, the noble Baroness, Lady Hayter, looks at this through rose-tinted glasses, having had her car repaired in a trice. It therefore depends on where you stand on this. I do not accept the Minister’s point that the amendment would have the effect of extending the repair indefinitely or undermining, which was the word that she used, the whole edifice that has been established here—that is a rather an extreme view about this.
The Minister’s statement about what “one repair” constitutes may go further than the wording of the guidance, some of elements of which I found quite helpful. That may horrify her, but she may have gone further than guidance, in which case I would ask that the guidance is looked at in the light of what has been constructed as a response today. That would be helpful.
I suspect that the industry will continue to kick the tyres of these clauses, to coin a phrase. It is still concerned about them. It may be that some tweaking could be done without opening the door in the way that the Minister thinks we have done in these amendments. I think that there will be some further discussions and I welcome in particular her offer, and indeed on behalf of her noble friend Lady Neville-Rolfe as well, to continue those discussions with the industry, which after all is an extremely important sector for us. In the mean time, I beg leave to withdraw the amendment.
Lord Clement-Jones
My Lords, I shall speak to Amendments 29 to 31. Although I think that I am singing very much from the same hymn sheet as the noble Lord, Lord Stevenson—I apologise if I go over some of the same ground because, as was the case in the Commons, these amendments are in parallel to those of the Labour Front Bench—these amendments follow directly from the conclusions and recommendations of the recent excellent report by the All-Party Group on Ticket Abuse. I happen to be a member of that group but, since I was not able to take part in the inquiry, I cannot claim any credit for it.
The amendments are not an attempt to shackle an important and growing service for consumers or to ban the resale of tickets. While accepting that there is a role for a legitimate secondary ticket market, the all-party group found considerable problems with how this market, which is estimated to be worth about £1 billion a year, works at present.
In particular, it does not adhere to the same principles of transparency and consumer protection to which other markets are held. With internet ticket selling becoming more streamlined, touts are able to use sophisticated computer systems to buy large volumes of tickets automatically, mere seconds or minutes after they are available online. That can often mean that it is practically impossible for genuine fans to access the event, forcing them to rely on an artificially created secondary market and depriving content creators of revenue for their event.
As the noble Lord, Lord Stevenson, mentioned, the Met Police published a comprehensive report on fraudulent ticketing and the dangers it posed to the Olympics. It specifically cited ticket fraud, touting and ticket reselling websites as areas of concern. The report stressed the need for an open and transparent system for ticket reselling, with clear and appropriate regulations. The new clauses address those shortcomings and would increase consumer confidence in the secondary market.
The first two new clauses address the lack of transparency, which the noble Lord, Lord Stevenson, emphasised. Amendment 28 is about who is selling the ticket. It would place a duty on secondary ticketing platforms to provide basic identifying information about the individual or business offering a particular ticket or set of tickets for sale. It would allow consumers to say how prolific and reliable a particular seller was; that would make the secondary ticketing platforms much more transparent. Importantly, it would also require secondary ticketing platforms to be transparent in cases where the seller was also the event holder. The practice of events organisers secretly allocating whole blocks of tickets directly to the secondary market has been on the rise. It was the subject of the Channel 4 “Dispatches” programme broadcast in 2012, entitled “The Great Ticket Scandal”. There is also a dishonest practice whereby a secondary ticketing platform, or rather its employees or shareholders, buy and sell tickets themselves, as the “Dispatches” programme also exposed.
Amendment 29 relates to the transparency of the ticket itself. I was very interested in the introduction of the noble Lord, Lord Stevenson, when he talked about the ticket itself; in many cases, knowing the characteristics of a ticket would make a material difference to a buying decision, particularly in the case of seated events, in which a person’s position in the venue can make a significant difference to their enjoyment of the performance or experience. Providing that information would also give consumers the confidence that the individual or company selling the ticket actually had tickets in hand and was not just speculating that it would be able to provide them at a later date. Making sure that consumers are made aware of the original price of the ticket that they are buying at the earliest opportunity gives them another piece of the information that they need to make an informed choice about whether to enter into such a purchase. Any genuine fans who need to sell on their tickets should not have a problem providing the basic information about the product that they are selling; nor should any professional reseller. The secondary ticketing platforms which claim to have higher standards should therefore have no problem adapting to the new provisions.
Amendment 30 concerns the recourse available to consumers. There have been numerous reports of event-goers being turned away with counterfeit or invalid tickets that they have bought via the big four secondary ticketing websites, all of which heavily promote their reliability and guarantee that their tickets are genuine. Of course those websites offer refunds, but people who come to venues with unusable tickets have all incurred at least some travel cost getting there. In some cases, they have come from abroad for the express purpose of using the ticket. For such people, a full refund on the ticket, while welcome, will still leave them out of pocket. The new clause would therefore allow those consumers to claim back the extra cost associated with attending an event, up to a reasonable level.
In practice, some resellers already offer reimbursement of travel costs. The new clause would place primary responsibility for that initial payback on the secondary ticketing platforms because they offer guarantees which, they say, consumers pay for in their significant service charges. However, having paid out that money, the new clause makes clear that the secondary ticketing platform may recover it from the seller of the ticket. The only individuals or businesses that the new clause would hurt, therefore, are those who have sold fake or invalid tickets and consequently caused financial loss to the consumer. The new clause would have the positive benefit of giving consumers the confidence that they would not be left out of pocket when they purchased tickets through the secondary market.
Baroness Neville-Rolfe
My Lords, we have heard a range of detailed and informed comments during this debate and I thank all noble Lords for their contributions, to which I have listened very carefully; it was good to have a variety of points made, and I am grateful to all noble Lords who have spoken. I am also grateful to the various sports, music and ticketing businesses that have spent time briefing me and the Government on these issues. In fact I should probably declare an interest as a big sports fan and a mother of cricketers.
Given the breadth of this issue and the different angles that people are coming from, I will divide my response into the two main types of sales in this market: sales from a trader to a consumer, and sales between consumers. I will then touch on the issue in Amendment 30 concerning refunds and compensation.
Before I do that, I shall briefly address the philosophical question posed by the noble Lord, Lord Stevenson, of whether a ticket—because it is either a goods item or an intangible legal right—is even capable of being sold on or transferred. The answer is that it is possible for a ticket to be defined either way. However, I am advised that this is ultimately a matter for judicial consideration, so it is not appropriate to attempt a determination in this Bill, or indeed for the Government to state publicly how we think a court would or should determine that question.
I turn to Amendments 26, 28 and 29 on business-to-consumer sales. I reassure the Committee that when traders sell to consumers there are already rules in place to ensure that consumers are aware who they are buying from and what they are buying. My noble friend Lord Clement-Jones said that the market was not subject to the same rules on transparency as other sectors, but this is simply not the case. The ticketing market is subject to consumer laws, including information requirements, to the same extent as any other retail sector.
The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, to which my noble friend Lady Heyhoe Flint referred, set out clearly in list form what information must be provided. For distance and online sales, such as ticket sales, that includes the price, the identity of the trader, contact details for the trader and the main characteristics of the ticket. In fact, there are no fewer than 24 information requirements on that list covering all the information that the consumer needs to make an informed decision.
In guidance on the regulations, we have included a specific paragraph on how the information requirements apply to tickets. I can quote directly from the guidance to reassure your Lordships that much of the information listed in the amendment is already required. The guidance states:
“Information on the main characteristics of the tickets and their total price (including delivery costs and other charges) must be given to the consumer in a clear and comprehensible way before the consumer purchases the ticket … For a ticket associated with a particular reserved seat (e.g. Seat 1, Row A) the seat number is a main characteristic”.
The regulations build on existing consumer law. The Consumer Protection from Unfair Trading Regulations 2008 protect consumers from being misled into a purchase by a trader.
The noble Lord, Lord Clement-Jones, asked about the October regulations. They are the Consumer Protection (Amendment) Regulations 2014; is that right?
Lord Clement-Jones
I did, but before my noble friend moves on to that, I quoted from the guidance and pointed out that, effectively, this is voluntary. The guidance states:
“Main characteristics include (if known to you)”.
I directly quoted from the regulations, as well. My noble friend has cited other parts of the guidance, but that is the crucial part.
Baroness Neville-Rolfe
I thank the noble Lord for that clarification. Perhaps I can continue to address the trader side. Where a consumer is sold a ticket that is claimed to be on the front row, for example, which turns out to be on the back row, that would breach the 2008 regulations. Advertising for sale a ticket that a trader is not in a position to sell because the ticket is either not available through the primary outlet yet or because the trader is awaiting the outcome of a ballot would also be a breach of the regulations, as well as a potential Fraud Act offence. Criminal penalties reinforce the legislation. A trader or a marketplace can be subject to a fine or even imprisonment if these regulations are breached. In conclusion, we believe that there is already sufficient law in place to ensure that consumers have all the information they need about what they are buying before they buy from a trader.
The noble Lord, Lord Stevenson, asked about botnets. A range of offences is available to law enforcement to tackle the fraudulent sale of tickets and the criminal harvesting of tickets from online ticket sales. The Computer Misuse Act 1990 sets out the framework of offences associated with interfering with a computer, including the criminal use of tools or articles to commit a computer misuse offence, such as a botnet. It was good to hear from my noble friend Lord Borwick that he believes that we are on the way to solving the botnet problem.
The noble Lord, Lord Stevenson, also asserted that there is evidence of large-scale criminal activity. We disagree. Europe Economics found that 90% of sales are by consumers such as you or me. There is already a strong framework to deal with criminality, such as fraud and money-laundering laws, which the noble Lord mentioned, that might take place in a market. Additional legislation for ticket marketing would not address such criminal activity. Obviously it is important to work with the police and other enforcement authorities, and we will review the data that the noble Lord asked for to see what up-to-date data we have. I will write to him on that point.
My noble friend Lady Heyhoe Flint said, “Will the Minister look at the websites?”. I will, but the enforcement of the law is for the CMA and trading standards. We have done some research. These sites already require key information to be given. All these sites have money-back guarantees. Most ticket transactions pass without problem—it is over 90%—so I think progress has been made there.
My noble friend Lord Moynihan gave us a very interesting summary of his experience with the Olympics—that wonderful summer which we all enjoyed in the brilliant sunshine, and the success of the Games. Indeed, as he described, it was very successful in terms of ticket sales, although of course there were some gaps in the audience, which was a sadness for consumers who would have liked to have been sitting in those seats. A ticket resale regime was a condition for hosting the Olympic Games. We brought that in and said at the time that such cases have to be considered on a case-by-case basis. I do not think that my noble friend was suggesting that this should be extended widely but he was asking us to consider that issue.
My noble friend Lord Moynihan also asserted that other countries had found a good way to regulate ticket sales. Our finding is that the evidence is mixed. New South Wales has a draft Fair Trading Amendment (Ticket Reselling) Bill restricting ticket resales, and we do not yet know its impact. As we understand it, these new restrictions are not the same as those in one of the amendments under discussion today. We have also seen press reports arguing that Queensland’s anti-scalping laws, as I think they call them, have had little effect. However, obviously we will keep those under review.
I have tried to talk about traders. I should now like to turn to the subject of Amendments 26, 28 and 29, which is consumer-to-consumer sales. We want consumers to be active and empowered in the market as buyers and sellers. It is a fact of life that sometimes consumers have a ticket that they cannot use. At this time of year I might buy tickets for my husband, a son and myself for a classical concert in the Royal Parks next summer. If my husband is taken ill six months later and cannot attend, I need to resell the ticket. That means that I can get my money back and it gives other consumers the chance to attend the sold-out event. We see no need to restrict this. Consumers should be able to freely and easily resell in this way tickets that they cannot use; my noble friend Lord Borwick made this point very well. The OFT has said that secondary agents can,
“provide a useful function for consumers who need tickets for events and are willing and able to pay premium prices”.
My noble friend Lady Heyhoe Flint asked about the impact of her amendment and how to build on the 2013 regulations. I shall try to answer. We know that over 70% of consumers think that they should be able to resell their tickets. Not only is it the right thing to do to allow this market to operate, but that statistic also indicates that if we restricted the legitimate resale market, consumers would find other ways to sell on the black or grey markets. We also know that consumers care about protecting their data and identity online. The Communications Consumer Panel reports that nearly two-thirds of social network users said that they had a high level of concern about the use of information from profiles by companies. In that same survey, the largest top-of-mind concern related to the safety of personal details or ID theft, with just over one-quarter of internet users spontaneously mentioning it.
Most consumers would not be comfortable having their contact details prominently displayed on a website. I am not sure I would like that—but I am sure I am not the only one who already receives too much junk mail. Consumers want to sell online and to protect their personal data. The current regulatory system allows that, while protecting consumers when they buy from traders.
Lord Clement-Jones
Before the noble Lord, Lord Stevenson, responds, I want to make just a couple of comments. I, of course, also will read Hansard carefully. I am somewhat disappointed because I am not sure that the voices in the debate have been heard clearly. I feel that somewhat of the straw man or Aunt Sally is being erected here as if the proponents of these amendments are trying to restrict the secondary market and prevent resale. My noble friend Lord Stoneham talked about restraint of trade. I thought that that was quite extraordinary and that we were almost in the realms of the EU or something. That is not the intention; nor is it the intention to drive people away from the event organisers to the secondary market. I do not believe that that would be the impact of what we are talking about here; that is, to get the benefit of a guarantee delivered by a secondary market in the possible event that a ticket is invalid or fraudulent. Surely, when you buy it from the event organiser, you know that it jolly well is not fraudulent or invalid. I am not really sure about that argument.
I could say many other things. As to the whole notion of the secondary market being entrepreneurial, if you know that a major sporting event is coming down the track, I do not know how entrepreneurial you have to be to reckon that a ticket for the World Cup is worth money and will be worth a great deal more money the nearer the time. I am sure that the noble Lord, Lord Borwick, is a great friend of entrepreneurs but there is entrepreneurialism and entrepreneurialism, in my view, in all of this. I think that a little bit of a splendid smokescreen is being erected around this issue. However, I take it from what my noble friend has said that there is an issue about the information given about an ordinary seller who is an ordinary consumer who has bought a ticket and wants to resell it, and the whole of their history is revealed for all to see on the secondary market. That is a perfectly valid objection and it may be a bridge too far. But there are many other aspects of these amendments which are extremely important.
My noble friend prayed in aid the regulations. The fact is that they are there but they are not adequate. I am grateful to the noble Lord, Lord Moynihan, for using the word “forensic”. If you look at the impact of these consumer regulations, you see that they are not sufficient to drive good behaviour, which is all that we are talking about in these circumstances. The main four resellers in the secondary market may well do what they can. They do not always publicise exactly what the tickets relate to. There may be merit in considering some sort of regulation where consumers do not have to pay for their tickets until the identity is known. It may be that you need a condition precedent: for example, having made the reservation, the consumer perhaps should not have to pay until the seat number can be stated. It is perfectly possible to think of a situation where that would be a valid way of behaving.
I will chew over what my noble friend has said but we have quite a bit more discussion to take place. Clearly, she recognises the strength of feeling in Committee. I think that this is a matter that we will take further during the course of the Bill.
Lord Stevenson of Balmacara
My Lords, I share the disappointment that the noble Lord, Lord Clement-Jones, expressed at the response to the debate. It was a very high-quality debate with some very important and influential speakers with track records and experience. It is not so much that their points were rebutted—that is what Governments do—but to have them rebutted in such an inventive way seems to me to trivialise what is an important point. We need to think very hard about what the next steps in this should be. For example, the Government do not seem to have a view on my genuine question of what a ticket is, yet they are regulating out of their ears—or that is what they say they are doing. To do so on the basis of not knowing what the central point is seems to be specious in the extreme. If they do not know what a ticket is, is it any wonder that the regulations do not do the trick?
It is absolutely clear from what has been said today and from the evidence that we have received that the current regulatory structure is a bit of a joke. It does not do what it is required to do: to make an efficient market for those who are trying to sell tickets for events they are running and for those who wish to attend them in a genuine capacity. It is not catching all the activity that is going through. The Government say that it is designed for traders, but somehow consumers are in a different category. I do not think that distinction stands up in what we are doing.
The guidance that has been issued has been tried and tested already and is clearly failing. It does not work. We need to do something about that. Under the regulations that have been in force since June 2014, I have been told by several sports bodies that no tickets that they can find on sale have the seat numbers or seller details provided. Are we to believe that no tickets at all are being sold by these traders? I do not think so.
Also, what exactly is a trader? During her response the Minister seemed to imply that there would be a case for arguing that people who bought tickets in excess of their personal demand could be treated as traders. If that is the situation, why do we not say that in regulatory form so that it is clear? It is currently up to the seller to define whether they are a trader or a consumer. In the example given by the noble Baroness, Lady Heyhoe Flint, the BA pilot who was caught selling several hundred Ashes tickets would definitely have been a trader by any definition yet was not prosecuted in that way. This is largely about consumer protection. Consumers are not going to be concerned about whether their ticket is coming from a trader or a consumer. They should have the right to know what they are buying. That is the basis of all the consumer discussions we have had on the Bill so far. It seems odd to carve this out in a different way.
I take the view that, if the Government are not going to outlaw secondary ticketing—I do not think they should—they must regulate properly for what they want: the desirable things, the things that will help the sports and help consumers. That will help to create a proper and open arrangement that is not susceptible to criminal activity of the type that we heard about from the noble Lord, Lord Moynihan, but which seemed to be rebutted by the Minister when she responded. The noble Lord, Lord Moynihan, said that there were about 1,000 people involved in criminal activity from known facts as a result of the Government’s investigations into the Olympic and Paralympic Games. What exactly is she saying if she says that some economists say that there is not any criminal activity because it was consumers who were buying the tickets? Of course it was consumers who were buying them, but if they were arriving through some form of criminal gang activity, that is not a very satisfactory situation.
As was made very clear in the debates, the amendments taken together give a range of options for the Government to look at. That is a rich opportunity for the Government to come back with something sensible at later stages in the Bill. We are not saying that there is a particular solution to this; there is a range of things that the Government could do. We are tending not to be draconian. We are not insisting on banning secondary ticketing; we are trying to say that there is a gap here in expectation. The genuine fan, the keen person who wishes to go to an activity but cannot access tickets at the beginning of the process and has to pay over the odds for them, is not well served by the information requirements. This simply is not working well. It could be changed through very minor regulatory change. It should be in the Bill because it is clear that the secondary legislation is not working. I really cannot understand why the Government are happy to be accused of standing by while consumers are being exploited.
We will undoubtedly return to this. I hope that between now and when this matter comes back on Report there may be an opportunity to have a further, more in-depth discussion with the Minister where we might get further down the line on this. In the interim, I beg leave to withdraw my amendment.