Consumer Rights Act 2015 and Consumer Ombudsman Scheme

Debate between Martyn Day and Yvonne Fovargue

Tuesday 11th February 2020 Westminster Hall

[Martyn Day]

I agree with the course of action suggested by my hon. Friend. It would benefit consumers and traders.

As I have pointed out, membership of an ombudsman scheme is voluntary, and a company can refuse to participate in an alternative dispute resolution process. Even though it may be in the best interest of consumers and companies to deal with problems quickly, effectively and amicably, I am sure no one will be surprised that unco-operative companies prefer to be obstructive, to prevent a quick, effective and amicable resolution. That was the experience of a constituent of mine with one such company, which I will come to shortly.

The Government response conceded that

“there is no mandatory requirement to use ADR although it is available for any dispute should the business decide they want to use it.”

This debate and my prior petition are about the Consumer Rights Act 2015, so it does not compute that businesses can decide whether they want to use an alternative dispute resolution while customers’ wishes are overlooked. It would be helpful if the Minister could explain how that relates to consumer rights. The production of the consumer Green Paper—a positive outcome of my petition—was meant to

“closely examine markets especially those which are not working fairly for consumers.”—[Official Report, 4 December 2017; Vol. 632, c. 6P.]

The example I will give is a good case of that. As my constituent’s experience will show, there are markets that are not working fairly for consumers. Despite the Green Paper, no amendments have been made to the 2015 Act to address the situation.

Among other things, the Green Paper consulted on two matters directly related to my constituent’s case: how to improve the system of alternative dispute resolution, and how to support local and national enforcers to work together to protects consumers. I draw Members’ attention to “Creating a successful enforcement system for UK consumers”, a policy report published a year ago by Which? Among other things, it directly addresses those two relevant matters. It proposes seven changes to create a regime that will protect consumers effectively, because the current system is, unfortunately, too weak.

The report proposes:

“A robust and accessible ADR system is vital for people who have been unable to resolve their complaint directly with the business concerned.”

It further states:

“Key to a successful system is… fair and enforceable decisions by ADR bodies”.

I fully endorse and agree with those points. The report goes on to address the proposed obligation for an ombudsman scheme to be compulsory, stating that

“an obligation on sectors (particularly where significant or essential purchases are involved)”

should be “part of a scheme”.

[Yvonne Fovargue (Makerfield) (Lab)]

Does the hon. Gentleman agree that the landscape of ombudsman schemes is very confusing, and that a single access portal would help the consumer?