Delivery Surcharges (Transparency for Consumers) Bill

Mike Weir Excerpts

Friday 13th September 2013 Commons Chamber

[Sir Robert Smith]

The hon. Gentleman has summed up extremely well the nature and purpose of the Bill. It is about transparency, so that shoppers do not have to spend ages shopping online only to discover at the end of the process, having put in all that effort, that they will have to face excessive charges, and then have to shop around elsewhere. The other benefit of early notification will be to encourage retailers to think more carefully about how they calculate those charges and about the nature of those charges.

[Mr Mike Weir (Angus) (SNP)]

In parts of Scotland, postcodes cover a huge area. For example, the DD8 to DD11 postcodes cover my constituency. I live in DD9. Brechin, the town in which I live, is just off the main road between Dundee and Aberdeen, but the postcode covers the whole area of the Glens. That is part of the problem.

[Sir Robert Smith]

It is indeed. Postcodes exist for Royal Mail’s purposes, to allocate addresses, but many people piggy-back on to them and then do not recognise the need to be more sophisticated and break them down further in order to establish the true nature of deliveries. Citizens Advice Scotland noted that it was possible for a delivery van to travel from a retailer in England to Edinburgh via the borders, passing houses whose occupants would end up paying excessive charges because they were further away from Edinburgh, although the van was passing their front doors and could have dropped the stuff off without having to go to Edinburgh. A resident of Inverness had to pay a £25 delivery charge despite living just two miles from the Inverness postal depot. Another highlands resident was shocked to discover when ordering a gift certificate from an electronics and camera retailer that there was a £15 charge for delivery, although the certificate was simply a postal card for which the normal rate could have been charged. That is another classic example of the failure of retailers to think when shopping around for delivery purposes.

The purpose of the Bill is to introduce more transparency and clarity. It requires the making of regulations, but does not introduce them itself; it allows the Government a year following its enactment in which to negotiate, consult and present the regulations to the House, which would then prescribe an early declaration of the charges for regional delivery so that shoppers could decide immediately whether or not to use a business advertised on a certain website.

--- Later in debate ---

[Jo Swinson]

I do not think that the problem has necessarily been quantified for all areas, but the hon. Gentleman is quite right. There has been a lot of campaigning on this issue in the north-east of Scotland and the highlands, not least because of work done by my hon. Friend the Member for West Aberdeenshire and Kincardine and others, but I am sure that it is also likely to be an issue for island or rural communities elsewhere in the United Kingdom.

[Mr Weir]

Citizens Advice also looked at Northern Ireland and found that there was an average mark-up of 216% for packages, so it is not just a problem for the highlands and islands of Scotland.

[Jo Swinson]

I thank the hon. Gentleman for that intervention. If I may add an anecdote, I was discussing the issue a few days ago in the Tea Room with my hon. Friend the Member for Argyll and Bute (Mr Reid), whose constituency is rather further south than West Aberdeenshire. He reported the frustration of some of his constituents in Dunoon when they telephone to ask why something could not be delivered or why it was so expensive. Dunoon, of course, is most often reached by ferry, and that information is clearly in a system somewhere, so the customer service assistant would explain to the customers that it was because they live on an island, which of course they do not, even if a ferry is often the most efficient way to reach it. That could create quite a lot of customer dissatisfaction. The important point for businesses to remember is that an unhappy customer is far more likely to tell other people that they are unhappy than a happy customer is likely to tell them that they are happy, so it is not necessarily in businesses’ interests for that to happen.

--- Later in debate ---

[Mr Mike Weir (Angus) (SNP)]

I am pleased to support the Bill promoted by the hon. Member for West Aberdeenshire and Kincardine (Sir Robert Smith), my parliamentary neighbour. The problem hits rural areas all over the UK, but particularly the highlands and islands of Scotland. I was somewhat surprised to hear the Minister say that she does not support the Bill—I believe I heard her correctly. That could be met with some consternation in a conference taking place in Glasgow this weekend.

Nevertheless, according to Citizens Advice research, more than 1 million Scots face surcharges, late delivery or refusals to deliver when they try to buy goods online. Consumers in Scotland’s island communities face a postcode penalty of nearly £19 on deliveries, which is a 500% mark-up on the standard delivery price. Of the 534 retailers whose policies were investigated, 63% charged extra for delivery to certain parts of the UK, and 72% of the surcharges apply to consumers in Scotland, which indicates that Scottish consumers are disproportionately affected by the surcharges.

Over the years, there have been attempts to do something about the problem. The Scottish Government held a summit—of the type that has been discussed—with retailers, trading standards and council officials to put pressure on retailers. It would be good if that pressure continued, because of the extent of the problem. However, one problem is that there is no consistency in how retailers deal with it—they have different delivery policies. For example, some charge extra for deliveries north of the line that runs approximately from Aberdeen to Fort William. Others do it by postcode, but that has ridiculous consequences. For example, many will not deliver to postcodes DD8 to DD11, which covers my constituency. I live in DD9 in Brechin, which is five minutes off the main A90 dual carriageway from Dundee to Aberdeen. They will not deliver there because of the huge area that some of these postcodes cover.

[Mr David Hamilton (Midlothian) (Lab)]

I agree with the hon. Gentleman, but this is not just a highlands issue. It also happens in the borders. People who live 90 miles south of Edinburgh can face the same problems.

[Mr Weir]

The hon. Gentleman is right, and to be fair, the hon. Member for West Aberdeenshire and Kincardine made that point.

We talk about consumers, but it cuts both ways; businesses in rural areas are also affected. Whether they are trying to get goods in or out, they cannot get couriers to deliver or pick up, so they are thrown back on the very good service that is currently provided by Royal Mail. It is, to put it mildly, ironic that this debate is taking place the day after it was announced that the Royal Mail is to be privatised, given the serious fears about the continuation of many services in rural areas. Notwithstanding what the hon. Gentleman said about this issue, those services may be under threat after privatisation and with increased competition in urban areas.

One example of the difficulties is given in the Citizens Advice report. One business faced carriage charges of £15 for a £8 plastic valve. That is uneconomic and mad. The company tried to get the supplier to send by Royal Mail, but the staff said that they did not have time to go to the post office, which seems a bit bizarre to me. The company got quotes from carriers ranging from £9.60 to £34. Part of the problem is the lack of clarity.

The report also looked at the main retailers and the views of their customers. The retailer trusted most by consumers was Amazon, because by and large it uses Royal Mail for its deliveries. The hon. Member for Christchurch (Mr Chope) mentioned John Lewis, which came in second, but way behind Amazon. If people order in store in John Lewis, it has displays giving the delivery areas. John Lewis will also deliver in my postcode area because it has a store in Aberdeen. All the major supermarkets will deliver in my area because they have stores nearby. It is about setting up a delivery system that understands the geography of Scotland, but many online retailers do not do that.

When people order goods online, they should know from the outset what delivery charges they will face. Other hon. Members may be more computer literate than I am, but I can spend a long time going through the process only to get to the end and find that I would be charged a ridiculous sum that I am not prepared to pay. I hope that the Minister will allow the Bill to make progress. It is not perfect, and it would not reduce the charges, but it would at least let people know what they face in charges. It would be a small step in tackling a difficult problem for many areas in the UK. My main interest is Scotland, but—as I pointed out to the hon. Member for Woking (Jonathan Lord)—there is evidence of a similar problem in Northern Ireland.

The problem is not confined to delivery charges. A constituent who came to see me was trying to get an assessment done under the green deal, but was told by British Gas that it did not send assessors north of Dundee. The issue affects rural areas in many ways, and I hope that the Minister will allow the Bill to make progress.