Draft Package Travel and linked travel arrangements regulations 2018

Maria Eagle Excerpts

Monday 14th May 2018 General Committees

[Maria Eagle (Garston and Halewood) (Lab)]

It is a great pleasure to serve under your chairmanship, Mr Hosie. I agree very much with what has already been said by my hon. Friend the Member for Sheffield, Brightside and Hillsborough, the hon. Member for Linlithgow and East Falkirk and, indeed, some of what was said by the Minister. The intention and implementation of these regulations are welcome across the Committee, although I seek one or two further points of clarification from the Minister, which I am sure he will be able to provide.

My hon. Friend the Member for Sheffield, Brightside and Hillsborough has already raised the issue of enforcement and the extent to which those who will be responsible for enforcing these new, more complex and extended regulations will be able so to do. She asked whether there will be specific moneys given, in particular to local trading standards departments, to ensure that they can enforce these new and more complex regulations. I want to reiterate that point.

My experience of local trading standards departments is that they are very hard pressed to meet their current statutory obligations, not to mention having to take on new and complex obligations. I wonder whether the Minister can be precise about the extent to which his Department will, under the new burdens principle, provide some resource to those hard-pressed organisations for them to be able properly to meet the new obligations they are to have under these regulations. He did not say that there would be new money, or give us any idea of how much was going to be available.

In similar vein, the CAA is the new central contact point. Clearly, it will also have new obligations under these regulations and a new function to fulfil across the country, and will therefore have to incur extra costs properly to carry out that function. Will the Minister be clear as to whether it, too, will receive commensurate extra resource to carry out the extra responsibilities that the regulations impose on it? The explanatory memorandum says that there is no impact on the public sector, but there are certainly impacts on those two organisations—local authority trading standards and the CAA—which will be expected to carry out further functions.

The directive’s new requirement for mutual recognition of insolvency protection arrangements across borders aims primarily at ensuring that cross-border trade is stimulated, and that when people are booking packages and putting together visits online in various ways, they can be assured and confident that, if there is insolvency around, they will be protected by whatever the arrangements are and that there will be mutual recognition of those arrangements across borders.

The Minister, to his credit, made some reference to Brexit, which is more than some of his colleagues do when considering the issues that face us in the coming reality of Britain leaving the EU. He expressed some hope that it will all be fine when we get to that point, but we need more information about the extent to which his Department has so far succeeded in making plans for after the UK leaves the EU, to ensure that the mutual recognition requirement is ongoing and can still be effective. He did not really give us any detail about the point that his Department has got to in the negotiations or the state of contacts with our EU colleagues. Although Labour Members note that he is hopeful, I am afraid that he has not given us any reason to be hopeful that the arrangements will be carried over in reality. Perhaps he will say more about that before he asks us to agree the motion.

[Andrew Griffiths]

I thank all Committee members for their positive contributions. I hope that I can shed a little more light to clarify some of the concerns and to reassure the Committee that we are in a good place in relation to protecting the rights of consumers when travelling in the UK and abroad.

I am grateful to the Committee for its consideration of the regulations. We all agree that booking package holidays and ensuring that people’s rights are protected, whichever way they book, can be a significant issue for consumers, and one on which we need to offer extra protection.

I thank the hon. Member for Sheffield, Brightside and Hillsborough for the positive way in which she engaged in the debate, as always. It is always a pleasure to debate with her. She asked a number of questions, first about analysis of the effect of organisations in the EU selling into the UK under the mutual recognition principle. The directive will raise the level of insurance protection across the EU and give greater protection. The new directive is far more robust about what insolvency protection must legally be in place. In addition, the central contact points, which I will come on to in a minute, and about which there were several questions, will provide a mechanism for us to monitor other member states’ insolvency regimes, so, in effect, there is extra protection as a result of these regulations.

There were some questions in relation to mutual recognition. Let me be clear: if a UK trader sells a package holiday into another EU member state, he can use the UK insolvency regime, rather than having to comply with the regime of the individual member state. The new mutual recognition principle that is introduced by these regulations makes it easier for UK businesses to sell package holidays across the EU.

[Maria Eagle]

Can the Minister tell us whether that will remain the case after the UK leaves the EU? What assurance does he have that it will?

[Andrew Griffiths]

The hon. Lady will know that, way above my paygrade, detailed negotiations are taking place. She will also know the phrase, “Nothing is agreed until everything is agreed,” which I must repeat. I reassure her that the UK has a great reputation and tradition of being at the forefront of protecting consumer rights. We do not need the EU to tell us how to protect the rights of our citizens and our consumers. We were at the forefront of the free market and of bringing in these protections.

I reassure the hon. Lady not only that these regulations will be copied across, as it were, on the day that we leave the European Union, but that ongoing and positive discussions are taking place to ensure that our consumers are protected when travelling abroad and buying packages or linked travel arrangements across the EU, and that European tourists can have confidence in buying packages from UK operators in future, knowing that their rights will be protected. UK consumer protection rights are based on EU law and they will be retained wherever practical.

There were a number of questions in relation to trading standards departments and their adequacy in providing the resources to support consumers in future. The hon. Lady will know that, through my Department, trading standards receives an annual budget of approximately £40 million, which has been pretty static in recent years. I agree that there are increasing demands on trading standards in a more complex world, in relation to package travel as well as consumer protections and safety. That is why the Government took the bold decision to set up the Office for Product Safety and Standards, which we debated last week, to give extra resource to trading standards across the country and act as a repository of information and expert advice. This year, the Government are putting an additional £9 million into that office and, in future, that budget will be £12 million. I reassure the Committee that the Government are putting extra resources into supporting our trading standards officers across the country.