Consumer Rights Bill
Debate between Philip Davies and Mike Weatherley(9 years, 10 months ago)
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Nic Dakin
I must move on, as other Members want to speak.
Points made by Members on both sides of the House have reinforced what was said by my hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson). We should be focusing on market failure, and the need to make the market operate well in the interests of performers, venues and consumers. I did not expect to speak in this debate, but I am doing so because constituents have knocked on my door and said that they consider the present system to be unfair and not in their interests, and I tend to agree with them. However, it is not only my constituents and me—and other Members—who take that view. In a letter that it sent to Members, UK Music says:
“UK Music's position is that we would prefer there was no secondary ticketing market as it is often understood as it does a disservice to our customers. Profiteering undermines the enterprise, endeavours and investment of those whose livelihoods depend on the future sustainability of the music industry.”
We should focus on customers and on those whose livelihoods depend on the music industry, and the same applies to sporting and other events.
I agreed with my hon. Friend the Member for Washington and Sunderland West when she said, in simple terms, that at the heart of the debate, the amendment and consideration of the Lords amendment was the question of whose side we were on. Are we on the side of consumers, or are we on the side of ticket touts? That is the choice before the House, and I hope that we bear it in mind later when we vote.
Mike Weatherley
While the speech by my hon. Friend the Member for Shipley (Philip Davies) was thoroughly entertaining, the “facts” in it were totally wrong. I hope that both he and my hon. Friend the Member for Bury North (Mr Nuttall) will listen to my speech, because it will address many of the points that they made.
I thank the hon. Member for Washington and Sunderland West (Mrs Hodgson) for her contributions, which were very good. I shall try not to duplicate the points that she made, and to make additional points. I also thank the Minister for telephoning me earlier today to talk about the issue. I appreciate that. It was the right approach to the debate, unlike some of the references to trilby hats and so forth that we have heard from other speakers. Let us debate this in a serious manner, because it is a serious matter.
Live events, whether they consist of sport, music or theatre, are essential not only to the British economy, but to British society. Each year our creative industries generate more than £36 billion, and employ 1.5 million people. If they are to continue to be so successful, we need to ensure that performers and fans are given a fair deal through a transparent ticket market. Otherwise, inflated prices will mean that fans continue to pay more for tickets, and performers will lose revenue.
Mike Weatherley
I will explain that to my hon. Friend in a moment, and I shall be happy to take interventions later.
Society has moved on from the time when there were a few cheeky-chappie touts outside venues selling tickets at marked-up prices. There are some who would reasonably argue that the small scale “street” touts provided a reasonable free-market service. The new issue with which the ticketing industry is dealing is the use of computer programmes, known as botnets, which buy up tens of thousands of tickets only seconds after they have gone on sale, so genuine fans are unable to purchase them at source. That is happening on an industrial scale, and the tickets are then sold on the secondary market. Some botnets in themselves are illegal because they have been used through hacked computers. They are immensely useful to touts, who are able to conceal their identity while purchasing large volumes of tickets with minimal questions asked. Botnets allow touts to seize control of the market, thereby increasing ticket prices.
Part of the reluctance of some to consider allowing the proposed measures to be implemented is based on the mistaken premise that those who are buying and reselling are in some way “classic entrepreneurs”. If that were the case, I would be on their side. I am a Conservative because of Sir Keith Joseph and his principles of the free market. In this instance, however, the free-market scenario has been broken owing to severe supply shortage and unequal purchasing ability. [Interruption.] If my hon. Friend the Member for Shipley wishes to intervene to tell me the five principles of the free market and explain why they apply to secondary ticketing, I shall be glad to debate the point. However, the free market has clearly collapsed because the principles of the free market do not apply in this instance.
There is another important dimension, which was raised by my hon. Friend the Member for Shipley. A ticket is not a commodity like a car; it is a licence to view, owned by the artist. The performances are not a commodity, but a licence to experience. There is the principle of allowing artists to remain in control of their performances. Let me give an example. A football club could sell all its family and juvenile ticket allocations for much more, but it recognises the importance of building a fan base. If all under-16 tickets were bought by “classic entrepreneurs” and sold to adults, tourists or the highest bidder, football clubs would not be developing their long- term fan base. The football clubs know that making a short-term price profit is not in their long-term interests, and it is surely right for the provider of the entertainment to be able to make a commercial decision not to sell at top dollar but to invest in the future fan base. It is the same for live bands and many other events. What the free market does do, which I support, is allow football clubs, bands and theatres to choose how much to charge for their event.
Mike Weatherley
I thank the hon. Gentleman, and I would like to thank him for his contributions over the years; we have had good debates in this Chamber.
It is probably true that my hon. Friends the Members for Bury North and for Shipley have unlimited budgets, but most people have a finite budget and they have to make decisions on how to spend their money. If they spend it all on ticketing, they will not spend it on other things.
As has been mentioned, different methods have been tried to control secondary ticketing and to protect purchasers, such as named ticketing. It has been proved, however, that this will not work for every event. It works in some situations, but not others. The industry would like to take other steps to control these abuses but it cannot do so. It has been argued by the ticketing organisations that the measures already in place are enough. If that was the case, why are we still seeing cases where fans or performers are not protected from exploitation and revenue loss?
These amendments do not restrict the buying and resale of tickets. All they ask is that the process is transparent so that buyers have information such as where the seat is, who the seller is, and what the original price of the ticket was, and whether the resale of the ticket is against the terms and conditions of the original purchase. It does not expose the seller to data protection problems. Only those sellers whose job is related to the live entertainment sector will need to provide employment details. This means that an informed decision can be made whether or not to buy a ticket. Similarly, it would mean that in cases where tickets were resold by industry insiders for a profit, it was out in the open.
Creating such transparency means that it will be easier to prevent and detect ticket fraud, expose and reduce insider dealing of tickets, and assist event-holders in protecting their customers from the worst excesses of ticket touting. It will also assist the artists in ensuring that they are able to deliver tickets to the intended market at the intended price. In my view, these amendments provide the right balance to avoid full legislation criminalising the activity by implementing sensible, reasonable information requests. To quote Steve Parker, managing editor of Audience and Live UK:
“The proposed amendment to the Consumer Rights Bill simply requires transparency and the restoration of fairness to the market. It is not a threat, restriction or burden to anyone operating honestly in this sector—it is a threat to those that seek to secretly manipulate the market for their own greedy ends.”
Only the operators who want to hide this information could possibly object to a request for the system to be transparent. The proposed measures have been formally supported by a wide range of stakeholders from the live event sector, promoters including Harvey Goldsmith, the Lawn Tennis Association, the National Theatre, the Musicians Union, the England and Wales Cricket Board, UK Music, the premier music booking agencies, managers of major British bands like One Direction, Iron Maiden, Arctic Monkeys, Muse, Radiohead and Mumford and Sons, and over 50 more in a letter issued over the weekend. These amendments are only opposed by those profiteering from the confusion and technological shortcomings of event ticketing.
Philip Davies
The list of those that support this which my hon. Friend rattled off were, from what I could tell, all big businesses in the entertainment world, but has he looked at opinion polls which show that when people are asked, “If you have a ticket, should you be able to sell it on to somebody else at a price you determine yourself?”, an overwhelming majority say yes? The idea that only a few people are against this flies in the face of all the opinion poll evidence.
Mike Weatherley
I am so glad my hon. Friend intervened because I would like to quote back to him some things he said in the previous debate we had on the Consumer Rights Bill, on Report on 13 May 2014:
“I think that one of the fundamental rights of the consumer is to know what they are purchasing.”
That is what this measure proposes. [Interruption.] If I may continue, he went on to say that
“legislation requiring labelling is essential for consumers to exercise their right to make an informed decision.”—[Official Report, 13 May 2014; Vol. 580, c. 672-73.]
My goodness, he could be giving this speech for me, Mr Deputy Speaker!
On mobile phone internet usage coverage, which is important, my hon. Friend said on 16 June 2014:
“The lack of transparency and clarity that has persisted in the market has allowed consumers to be deceived.”
That is amazing; it could apply to the area under discussion now. He went on to say:
“It seems like the voluntary ways of ensuring greater transparency...have failed.”—[Official Report, 16 June 2014; Vol. 582, c. 896.]
He said that about mobile phones, but why should it not apply to this debate?
Philip Davies
I am sorry to urinate on my hon. Friend’s bonfire, but the point is that if I buy a ticket for the Lords test match, I know what I have got. There is no transparency issue; it is a ticket for the test match at Lords. The quotes he is giving on halal meat and all the rest of it are completely different from a ticket to a Lords test match, where it is perfectly clear what I have bought.
Consumer Rights Bill
Debate between Philip Davies and Mike Weatherley(10 years, 6 months ago)
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Philip Davies
Let me make something clear. I am not picking on anyone. I do not want to ban anything. People want to buy religiously slaughtered meat, although that may not be my choice. It is Labour Members who want to ban everything that they do not happen to like. That is not my style. I happen to believe in freedom of choice, and I want people who want to buy religiously slaughtered meat to be free to make that choice. Equally, people who specifically do not want to buy that meat should be free to make that choice. So this is not about picking on anyone. It is not about trying to ban anybody from doing anything.
I do not really see who loses out from the new clause. It is to the advantage of those people who want to buy halal and kosher meat and to the advantage of those who specifically do not that meat is properly labelled. So I do not see who the victim of my new clause is. Everyone is a winner. It is to everybody’s advantage that meat is properly labelled and above board so that everyone knows that what they are buying is what they want to buy. That is the only intention behind my new clause; there is no other objective. I am not seeking to ban anything or stop anybody from doing anything they want to do. I merely seek to allow people to make an informed choice. My hon. Friend the Member for Huntingdon (Mr Djanogly) asks why. The simple reason is that there is a huge demand for labelling out in the country—there certainly is in my constituency. That is why I introduced a ten-minute rule Bill on this very issue two years ago. It was defeated by three votes, largely by the politically correct brigade on the Opposition Benches. It was a big issue in my constituency then. I contend that it is an even bigger issue today. It has not mushroomed out of nowhere. There is widespread customer demand that proper information be given so that people can make an informed choice.
Philip Davies
I have said that I must make some headway.
British legislation requires the stunning of animals before slaughter, with the religious exemptions that the hon. Member for Birmingham, Ladywood (Shabana Mahmood) made clear. Religious traditions sometimes require people to slaughter without stunning. The exemption dates back to the Slaughter of Animals (Scotland) Act 1928 and the Slaughter of Animals Act 1933, which applies to England and Wales. The EU also granted derogations from stunning regulations for religious communities.
In recent years, animal groups, most notably the Farm Animal Welfare Council, have advocated labelling of some meat to decrease the amount purchased, thereby reducing the amount of unstunned meat, as my right hon. Friend the Member for East Yorkshire (Sir Greg Knight) said.
Neither the British Parliament nor the European Parliament has passed a law that requires labelling of unstunned meat, but there has been much debate about it in the past. My new clause would make it compulsory for halal and kosher meat to be labelled because, as a strong believer in freedom of choice, I think that one of the fundamental rights of the consumer is to know what they are purchasing.
I spent 12 years working for Asda before I entered the House. Some of the supermarkets are reluctant to do anything about this because it is inconvenient for them to go through the food chain to provide the labelling. When I was at Asda, I was taught that we were in business to do what was best for the customer—to do what the customer wanted, not what was for our convenience. I am rather worried that that attitude is slipping in some of our supermarket chains. It is not about what is most convenient for them; I do not care about that. They should be delivering what their customers want, and there is no doubt that this is what customers want to see.
Consumers cannot satisfy their preferences at present because not all meat products are labelled. Therefore, legislation requiring labelling is essential for consumers to exercise their right to make an informed decision.
Philip Davies
I am not going to give way.
I would much prefer it if legislation was not required. I am not the type of person who wants to rush to legislation, but in the two years since my ten-minute rule Bill was introduced absolutely nothing has happened. There have been plenty of opportunities for the retailers to sort this out for themselves, and they have failed spectacularly to do anything about it.
This is important. According to the EU DIALREL project, the exemption from religious slaughter in schedule 12 to the Welfare of Animals (Slaughter or Killing) Regulations 1995 clearly states that the exemption applies to people of that religion—not to everybody. That implies that halal and kosher meat should be consumed by those of Muslim and Jewish faiths respectively, because that type of slaughter is specified for their religious needs. That is clearly not the case, because Muslims make up a small proportion of the UK population, yet the Halal Food Authority estimated two years ago that halal meat makes up 25% of the meat market. I suspect that the figure is even higher. Similarly, approximately 70% of kosher meat that is sold is not consumed by the Jewish community.
We are going far beyond the exemption that was designed for those people with their particular religious beliefs. There have been cases of schools, hospitals, pubs, sports arenas, cafés, markets and hotels serving halal meat to customers without their knowledge. I am led to believe that it even happened in the House of Commons canteens in 2010. To my dismay as a former retailer, it has certainly happened in some of the larger supermarket chains, and in some of the largest food outlets such as Pizza Hut, Domino’s and KFC. It has also happened in schools. In 2010, Harrow council faced a massive protest after announcing a plan to serve halal-only menus in the borough’s state primary schools, and parents complained that it was forced on them against their will.
Some 98% of consumers in the 2004 Co-op survey of consumer attitudes to the ethics of the food industry stated that they supported the humane treatment of animals. Considering that some halal and kosher meats are slaughtered without pre-stunning, many such consumers would not buy the meat if they were aware of what it was. Interestingly, Massood Khawaja, president of the Halal Food Authority, stated in September 2010:
“As Muslims have a choice of eating halal meat, non-Muslims should also have the choice of not eating it. Customers should know it is halal meat.”
An amendment to induce the compulsory labelling of unstunned halal and kosher meat and products would give consumers more freedom of choice, increase market efficiency, as retailers are enabled to respond to customer demand, and help to protect animal welfare rights.
It is not just me who thinks that. The Sikh Council UK has put out a statement agreeing with that. It believes that everyone has the right to purchase and consume food in accordance with their religious beliefs. Hindus have said that they, too, agree with my new clause, and believe the same thing. Many of these groups do not focus on animal welfare but specifically object to the religious blessing that goes with the practice. I will conclude with this particular point about halal and kosher meat. I do not know if hon. Members read the article by Taj Hargey, the director of the Muslim Educational Centre of Oxford and the imam of the Oxford Islamic Congregation, who said that the practice is
“covert religious extremism and creeping Islamic fundamentalism making its way into Britain by the back door. It is completely wrong that the food sensitivities of Britain’s Muslims—who amount to just 4.8% of the population—should take precedence over the other 95%. Halal meat should never be forced on customers without their knowing, surreptitiously and using clandestine methods. It’s unfair to everyone, non-Muslims and Muslims alike.”
He also said that the idea that Muslims cannot eat non-halal meat is completely wrong, and
“has no theological basis in the Koran, the supreme text of Islam.”
He said:
“I’m a dedicated Muslim, a devout religionist, an imam and intellectual scholar of Islam, but I eat whatever food is placed before me, with the obvious exception of pork. If you’re kind enough to invite me to your home, I would eat whatever meat you chose to serve”.
He concluded:
“It is high time the white, liberal, Guardian-reading classes stopped behaving like apologists and woke up. There is a fundamentalist Trojan horse in our midst, and we must take corrective action.”
Many people in this country are demanding that this House take the action that they would like to see.
Mike Weatherley
I congratulate the hon. Member for Washington and Sunderland West (Mrs Hodgson) on a thorough interpretation of the new clauses.
Music, theatre, comedy and sport are a vital part of British society and the British economy, and our creative industries are worth more than £36 billion a year. They generate £70,000 every minute for the UK economy, and employ 1.5 million people in the UK. That is why it is vital to have a healthy and transparent ticket market, yet with increasing frequency, secondary ticketing resellers are causing dramatically inflated prices for the fans, and taking away revenue from performers. That has to stop.
I have consistently been a champion of the free market and I do not have a problem with artists or sports teams charging whatever they wish for their services. That is their prerogative, and they should be allowed to set the prices of their tickets or, if they choose, to sell them through secondary ticketing or auction websites. However, as the online marketplace has become quicker and easier to use, a large number of unsavoury and illegal practices have sprung up surrounding ticket reselling websites. That is why I, along with colleagues from both sides of the House, founded the all-party group on ticket abuse. We conducted a review and the results were published recently, as we have heard, with new clauses recommended as a result.
One key aspect of an honest and transparent ticket purchasing process is the intention of the buyer at the point of purchase. No one would begrudge a Rolling Stones fan who has become ill the day before the show the opportunity to sell their ticket to someone else. However, an increasing number of people are buying tickets with absolutely no intention of going to the event. Instead, those career touts buy tickets solely with the intention of denying them to real fans, whom they can squeeze for profit by reselling their tickets to a “sold out” event.
That situation is not limited to fans who simply waited too long to buy tickets. 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 go online. That can often mean that it is practically impossible for genuine fans to get access to the event, forcing them to rely on an artificially created secondary market, and depriving content creators of revenue for their event. That is unacceptable.
On this issue I fundamentally disagree with my hon. Friend the Member for Shipley (Philip Davies), who raised some points earlier, because we would all suffer, including the artists. Just because an artist has received the full value for a concert that is sold out does not mean that they—or another artist—would not suffer elsewhere. For example, suppose someone has a budget of £500 a year for going to venues. They might think, “I’ll go to 10 concerts in that year and buy some merchandising and other products while I am there”, but if they then spend £200, £300 or even £500 on one concert, they will not go to the other nine. No wonder there is underselling in other concerts because people do not necessarily have the money, and we all lose out as a result.
Mike Weatherley
My hon. Friend is shaking his head, but he must understand that my point is right. I would, of course, prefer no legislation on the subject and to rely on industry-led solutions, as we heard earlier. A potential solution to touting, which has been adopted by some venues already, is to use credit card verification. However, touts often generate such large profits from many events that that method is ineffective. There are also additional problems of crowd control and so on. If hon. Members who disagree with that point had bothered to come to the all-party group when we took evidence, they would have heard from promoters who have tried those other methods that such things do not work, and they would not try them again for all sorts of reasons.
The Metropolitan police published a comprehensive report on fraudulent ticketing and the dangers it posed to the Olympics; it specifically cites ticket fraud, touting and ticket reselling websites as areas of concern. Among several issues, the Met noted that websites with servers based overseas were causing serious problems by advertising fraudulent tickets, and making it difficult for law enforcement agencies to track the offenders or shut down illegal sites. The report stressed—as do I—the need for an open and transparent system for ticket reselling, with clear and appropriate regulations.
Transparency is key to protecting not just content creators but ticket buyers from dubious and misleading transactions. Again, I will refer to my hon. Friend the Member for Shipley because I never thought there would be a connection between halal meat and secondary ticketing. I was keen to intervene on him but he would not allow me to. All through his speech, however, he made the point that clear labelling and the consumer being aware of what they were buying was fundamental. He said—I wrote it down—that it is a fundamental right that consumers know what they are buying. That is exactly what the new clauses are saying, no more and no less. For instance, it is common in the entertainment industries for all or part of the fee for professionals involved in an event to be paid in tickets. The venue might be paid in tickets to a corporate box and a promoter or manager may be given some as part of their fee. That is done with the tacit understanding that recipients of such tickets will subsequently be able to sell them for significantly more than their face value. It is, of course, the prerogative of the content creators if they wish to do this, but it should be done transparently.
Some hon. Members, including my hon. Friend the Member for Shipley, have suggested that trying to regulate ticket touting is an interference in the natural free market. However to say this is to misunderstand—and be wrong about—one of the key principles of the free market, which is the ability for the market to respond to demand by increasing supply. In the case of sports matches or live music, there is no way to increase the supply. There are only so many games in the season and bands can only play so many dates. That is why it is so important for the content creators to be in control of how their tickets are sold. It does not in any way infringe their right to charge however much they want for the tickets, as long as it is part of a transparent and well regulated system that works in the best interests of fans and performers.
New clauses 18 to 21 are intended to assist that transparency. None of the clauses would restrict the secondary markets, but they would become more accountable. In particular, people who had been sold an invalid ticket would be compensated more than just the ticket price to reflect the true cost of attending. New clause 20 would restrict the cost to twice the price paid for the ticket, which might not be the full cost to those attending, but would at least give some incentive to those selling to get the ticket price right, without being an open cheque book.
We have come a long way since I first supported the private Member’s Bill of the hon. Member for Washington and Sunderland West (Mrs Hodgson) a few years ago. Then, there was little support for measures to protect consumers from the worst aspects of ticket touting. Now, I am pleased to say that, with increased knowledge and understanding, there is increased agreement on both sides of the House that something needs to be done. The small measures suggested in new clauses 18 to 21 are a step in the right direction, and I trust that the Minister will address at least some of the issues when she responds later.
Ticket Abuse
Debate between Philip Davies and Mike Weatherley(10 years, 10 months ago)
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Philip Davies
That might apply anyway. I do not know how shops operate, but it might well be that the shops say to staff, “If you want one, you can have one.” By the time any real punter gets in there, the items have all gone to members of staff. Does the hon. Lady really think that the Government should legislate to stop that from happening? That would be nonsensical. I do not see tickets as being different from anything else that people choose to buy and sell on at a higher price.
Mike Weatherley (Hove) (Con)
I also hesitate to rise to the bait, but is the point not about who owns the product? If someone buys a newly released iPad from someone else, it becomes their property to own and sell on, as would happen with baked beans. With tickets, the creative owner might prefer them to be sold in a particular way. For example, sports facilities might want a children’s area to build up support. The facilities could sell those tickets at much higher prices, but they prefer to sell them for a different reason than to be sold on again. It is the facilities’ products to do what they want with.
Philip Davies
My hon. Friend is right. It is the facilities’ product to do as they want with. If they want to go from house to house, picking the individual they want to sell those tickets to in a private transaction, they are free to do so. They choose to sell them in the public domain for anyone to apply for them. They sell them as they have chosen to sell them, and people are purchasing them as they have been invited to purchase them, so I am not sure what point my hon. Friend is making.
Mike Weatherley
That is an interesting point. If the owner of the ticket—the creative holder—wanted to restrict the people to whom it could be sold, does my hon. Friend agree that they should be able to?
Philip Davies
If the creator wants to sell the ticket in a particular way that to him or her guarantees that it goes to a particular person, they are free to do so. If they want to put it on the open market, the chances are that it will be purchased on the open market, and that is what happens. It is no good people bellyaching when people buy their tickets on the open market—presumably that is why they were put on the open market in the first place.
The idea that ticket touting negatively affects the artist or the person who is setting up the event is for the birds. If somebody is selling 50,000 tickets at £20 each, they have decided that they want to rake in £1 million in ticket sales from the event. It seems to me that the ticket touts are helping by buying up the tickets, because when the 50,000 tickets are sold, the event organiser and the artist have reached the amount—£1 million—that they were hoping to gain from ticket sales.
Whatever happens on the secondary market has no impact on the income that the event organiser has received from fixing up the event. It is still £1 million. If the event is not as popular as some people might have anticipated, the tout may well have done a favour by buying up tickets that they are not able to resell. They did not really want to go to the event, so they have helped the event organiser and the artist. The idea that reselling works is against the interests of the organiser and the artist is absolute nonsense. I hope that the Minister appreciates that and that we can nail the point for now.
My hon. Friend the Member for Hove is right: the event organiser can do lots of things to try to discourage people from selling tickets on. For example, for an event in, say, four months’ time, instead of selling all the tickets in one go the moment the gates open—therefore encouraging the secondary market—the event organiser could sell a few tickets week by week, including up to the final week before the event. In that case, the secondary market would not be quite as attractive because tickets were still going to be available the week before in the primary market.
If the issue is so massive for event promoters and organisers, why do they not take the steps within their capability to try and deter the market? As far as I can see, it is all crocodile tears. If such a terrible thing is happening, which is against the rules, and if people put on the tickets that they are not for resale, it is open for ticket sellers, event organisers and artists to take people who resell the tickets to court. If they are so sure of their ground on the issue, why not do that? Perhaps it is because they fear that the courts will decide that what they are trying to impose is an unfair condition on the selling of tickets. I suspect that they shy away from doing so because it will be exposed for the world to see that what they are trying to argue for is anti-competitive and an unfair thing to impose on somebody whom they are selling to. I suspect that is why we get all the hot air in places such as this, but why no one stumps up the money to take the case to court.
On looking after the interests of the consumer, I should mention the net book agreement. I was at Asda when we bust that agreement. What used to happen in years gone by was that publishers—I am sure my hon. Friend would have supported publishers at the time—produced a book and set its price, and nobody else could sell it at any other price. Asda, when I was there, felt that that was terrible for the consumer. We wanted to sell it for less and thought that our customers wanted to buy it for a lower price, so we decided, “Blow it, we’re going to sell them at a lower price anyway”. Of course, the publishers took Asda to court and what happened? The courts found in Asda’s favour and book prices collapsed, to the massive advantage of the consumer.
Presumably everybody here who is arguing against the secondary market for tickets are the sort of luddites who would have kept the net book agreement in place, thinking that publishers should have the right to charge whatever they like for a book and that retailers should not be able to sell it at a lower price. I think that was a nonsense then and it is a nonsense now, and there is absolutely no difference between the arguments. Saying that the event organiser should be able to charge what they like for a ticket and not allowing anyone to sell it for any other price is the same as saying that publishers should be able to sell a book at a price they set, and that nobody should be able to sell it on at a lower price themselves. I hope that the Minister accepts that argument as well.
The hon. Member for Washington and Sunderland West mentioned the rugby world cup. It seems to me that for that tournament, the secondary ticket market should not only be allowed to happen, but is desirable. As I mentioned to the Minister, people in New Zealand may well be very confident that their team will get to the final, so they might buy up tickets for the final in huge quantities. However, their team might get knocked out in the semi-final. We need some mechanism for allowing fans of South Africa, for example, who may have beaten New Zealand in the semi-final, to get hold of the tickets that all the New Zealanders have bought.
It seems to me that the secondary sale of tickets works to the advantage, rather than the disadvantage, of the consumer. It would be a bit of a sickener if someone bought the ticket for their country’s game, but could not sell it on because of some well meaning legislation that the hon. Lady is trying to impose.
We then hear the typical argument that real fans suffer. I have no idea how one defines a real fan, but I will hazard a guess that if someone is prepared to stump up £2,000 or £5,000 for a ticket to see a concert or a sporting occasion, they are a real fan. No real fan would stump up such a huge quantity of money to go and see something that they were not really interested in. It seems to me that the resale of tickets is more likely to guarantee that real fans turn up than any other mechanism.
The Labour party used to believe in the redistribution of wealth, but that is obviously long gone from its DNA. The chances are that the person wanting to buy a ticket for £5,000 is wealthier than the person wanting to sell it for £5,000. If somebody who is relatively poor wants to sell off their ticket at a huge profit, that seems a rather good redistribution of wealth from the rich to the poor. Obviously, however, the Labour party has given up on the redistribution of wealth. I am sure that many of its members and supporters would like to know that.
Nobody loses out at all with the resale of tickets. The event organiser gets the income that they had budgeted to get from the event, so they certainly do not lose out, nor does the artiste, who is guaranteed to perform before a packed audience. If I want to go to an event but am not sure whether I can, because of work commitments, when I finally decide that I can, I have only one mechanism through which to buy a ticket—the secondary market, which gives me an opportunity to go. If that market was not allowed, I would have no chance of going at all.
If I do not want to pay the inflated price that is being asked for the tickets, I do not have to. Nobody is forcing me to, so I have not lost out through the secondary market. I have been given a choice and an offer that otherwise I would not get. I am not entirely sure who loses out with the resale of tickets. I do not see who the loser is, to be perfectly honest, because for many occasions, the tickets will sell out in five minutes flat, so many legitimate people would not be able to go. The secondary market gives them a chance that they would not otherwise get.
The hon. Lady mentioned people selling on tickets that do not exist. That is called fraud. It is already illegal; I am not entirely sure why she wants to make it more illegal, but we cannot make something more illegal that is already illegal, so we can easily dismiss that.
Finally, the hon. Lady seems to think that the public are on her side on the issue, but I have no idea on what basis. ICM conducted opinion polls on the issue and asked people about this premise:
“If I had a ticket to a sporting event, concert or other event that I could no longer use, then I should be allowed to resell it.”
Some 86% agreed with that. Some 83% agreed with this premise:
“Once I’ve bought a ticket it is my property and I should be able to sell it just as I can any other private property”.
The enthusiasm of the hon. Member for Eltham appears to have wilted at that point, but that is not the case for 83% of the population. Some 86% of people polled agreed that
“It shouldn’t be against the law for people to resell tickets that they no longer want or can’t use.”
The same opinion poll showed that a clear majority thought that the price of a ticket should be determined only by what they were willing to pay. That seems to fly in the face of all the arguments that we have heard today.
I hope that I have instilled some balance into the debate, and that the Minister will bear in mind the Select Committee and Office of Fair Trading reports, as well as the excellent evidence given by the right hon. Member for Barking to the Select Committee, to the effect that what we are debating is the free market in operation. We should not try to outlaw it, but encourage it, because it works in the best interests of the consumer. That is what the Select Committee and the OFT found when they looked into the matter.
Mike Weatherley
I have no problem with someone doing that if they want to. My point is that someone who does not want to do that, but wants to sell to a particular sector of society, such as young fans or particular fans in certain areas, should be allowed to apply to do so. I see nothing wrong with the people who provide the content suggesting how much they should get for it. If they want the free market to decide the price, I would be the first to say that that is right. If they want to give tickets to the promoter to sell on for whatever price they can get, as part of the deal, that is fine. Let us not, however, say that there should be no transparency about it, and that it should be under the table. We should bear in mind the police’s comments about secondary sites driving illegality.
Philip Davies
Obviously the event organisers do not care very much about it. I know that my hon. Friend has influence with people in the music industry. If they want to sell tickets to a young target audience, I am happy to use my good offices to try to distribute them around schools in my constituency—I hope that he will tell them so. However, they choose not to. They put them on the open market for anyone to get them, as they choose. If they are that bothered, perhaps they will take up my offer to distribute them in such a way.
Mike Weatherley
I would be delighted if my hon. Friend would meet me and some of the people from the industry. In fact, it would be fantastic if he was able to come along to some of the meetings of our all-party group at which we could hear from band managers and promoters about some of the problems that they experience. They tell me that this is a huge problem and that their fan bases, to whom they would like to distribute the tickets, also find that it is a problem. That is not me saying it, but the people who are in control of these things. They are looking to the Government to help them with sensible and fair regulation.
The proposals from the hon. Member for Washington and Sunderland West are measured and sensible. This would be not a huge leap forward, but a gentle nudge in the right direction that would assist the process of tickets being provided at the price that people or performers would want. I see nothing wrong with the proposals. The free market can still operate in situations in which performers would like it to operate. All we are saying is that there should be some sense in the whole thing.
Sale of Tickets (Sporting and Cultural Events) Bill
Debate between Philip Davies and Mike Weatherley(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mike Weatherley (Hove) (Con)
I refer hon. Members to my entry in the Register of Members’ Financial Interests.
I congratulate the hon. Member for Washington and Sunderland West (Mrs Hodgson) on introducing the Bill and on allowing the House to have a lively debate.
Before I get on to the reasons why I—perhaps surprisingly—support the Bill, a little background is in order. At university, I was fortunate enough to attend a speech by the late Sir Keith Joseph, who changed my life. The speech was about free markets and, although I was studying business studies, I had the preconception that it would be boring—how wrong I was, because I was blown away by the arguments. I am a Conservative, because I believe that the free market is far and away the best method by which efficiently to allocate resources. Risk needs to be rewarded, and consumers should have the ultimate say on how products are delivered and at what price. In 90% of cases, the market should decide.
My second interest in the Bill stems from my love of live music and sport. Music and other forms of creative expression are vital to the British economy. I have delivered a number of speeches in the House about the importance of the music industry to the country for overseas earnings and suchlike. The performing arts and sport sustain employment and tax revenues, which benefit all our citizens. There is, however, a blight that creams off revenues by exploiting an imperfect market and contributes nothing to the creative copyright holders. That blight consists of those who profiteer by exploiting excess demand.
Ticket touts who take advantage of availability do nothing to promote our creative industries, and this is one of those rare examples where the Government need to step in to protect creative persons. There are five conditions for the formation of a perfect market, such as perfect knowledge of alternatives and so on. One of those conditions concerns the availability of supply. That is fine for physical products, which can be increased or decreased according to demand—for example, when manufacturing output is turned up, supply increases and the equilibrium price is found again. However, where supply is based on an individual, it is impossible for the number of hours in the day or the number of days in the year to be increased. A performer cannot be in two places at the same time. An imperfect market is then created, and prices rise due to a shortage of supply.
The question is whether intermediaries should be able to take advantage of that imperfection against the wishes of those providing the service. I certainly hope that everyone present in the House today recognises the value of copyright protection to the creative industries. If anyone does not, I suggest that they review the conclusions of the Gowers report, which agrees that intellectual property, and thereby the wishes of the creative person as to how their product is produced, marketed and used, should be protected. The copyright owner should retain control of their product.
Philip Davies
The problem with this line of argument—the comparison with general intellectual property—is that with other forms of intellectual property infringement, the person producing the goods or services loses out. With ticket touting, the promoter does not lose out because if they are selling 50,000 tickets at £20 each, they are hoping to get £1 million, and whether or not a ticket tout buys those tickets and sells them later they still get their £1 million, so they do not lose out financially.
Mike Weatherley
I am grateful to my hon. Friend for making that point, to which I shall give a specific answer later.
The issue is who owns the product that people are going to see. My view is that the copyright owner who produces the good, whether it is a concert or a sports event, is the owner and should have control of it for various reasons. There are many reasons why a business might want to price at below full market value—in specific sectors, market penetration is one such reason; reward for loyalty is another. Football is a good example. There is differential pricing in stadiums, but clubs depend on their regular, grass-roots fan base, and this is recognised in the lower prices in certain sections. Many clubs have a young persons’ section at half-price. They could easily charge full-price for that section, but they do not. If the argument of free market enterprise were applied to those tickets, young people would buy them and sell them on at a much higher value, but the club does not want them to resell those tickets at a higher price, as it knows they could, because it wants to encourage a loyal fan base and benefit the community.
Philip Davies
It is interesting that my hon. Friend uses football as an example because as the Minister said, the restrictions on ticket touting in football are to do not with ticket touting but security. Even so, an increasing number of clubs not only allow but actively encourage season ticket holders to resell their tickets through the secondary market when they are unable to go to a particular match.
Mike Weatherley
I have spoken to various football authorities about this, and the reason they allow the selling on of season tickets is that they recognise that people must have a mechanism for reselling if they cannot go to a match. However, the football authorities would not want someone to sell their season ticket for a particular match at 10 times its value. I happen to be going to a Chelsea-Manchester United match later in the season, but I have not paid 10 times the value of that ticket: I have been given it by a season ticket holder who cannot make the match. That is entirely proper.
Philip Davies
That is a perfectly fair point, but the hon. Gentleman did not manage to persuade his Government to adopt that approach when they were in office, as they killed the Bill when it last came up, so I am not entirely sure why anybody who is against it now should be considered a tyrant, because his Government killed exactly the same Bill in the previous Parliament.
New Labour clearly is not dead, because the hon. Gentleman seems to think that just by asserting something, it is therefore true: so if he says that he believes in the free market, it is therefore sufficient proof that the Labour party believes in the free market. I take a rather different view: I think our policies have to reflect our assertions. We cannot just say, “I believe in the free market” and then pass laws that completely fly in the face of the free market. I ask him for some consistency, so that his lofty words about believing in the free market might be followed up by action and policies that support them. I am afraid, however, that I cannot see any of that happening.
Mr Deputy Speaker, you are in a privileged position in this debate, because you were also on the Culture, Media and Sport Committee with me when we considered this matter two or three years ago. We conducted an interesting inquiry. The hon. Lady was absolutely right: not only did we find the secondary market to be perfectly legitimate, but her Government found exactly the same. She did not mention this point, but she will also be aware that the Office of Fair Trading has always made it clear that the secondary market for tickets is not only not a bad thing but actively works in the consumer’s favour.
That brings me to my hon. Friend the Member for Hove (Mike Weatherley), who says that the people who own the rights to an event—the promoters or, in his words, the holders of the intellectual property—should be free to determine such matters. That is a perfectly legitimate and respectable view to hold, but I do not agree. I was encouraged, nevertheless, as he said he was not really taking the consumer’s interests into consideration. They did not matter; what mattered was the intellectual property holder. That is a perfectly respectable view, but I do not agree. I think that the public—the consumers—are an important part of the process.
Mike Weatherley
My hon. Friend makes a good point, and I thank him for his comments, but does he agree that the point is not about the free market, which we all fully endorse and support, but about the ownership of the product, control over the creative product and the ability to determine whom one should sell to and deal with?
Philip Davies
I agree with my hon. Friend on many things, but not on this. I believe that if I sell a product to somebody else who hands over the money that I have asked for to purchase it, I have ceded that product to that person. That is the whole point of the free market. If somebody goes into a supermarket, buys a product and sells it on, I do not believe that the supermarket should have a go at that customer for doing that; once it had sold it, it was that person’s to do what they wanted with it.
The issue comes up in all sorts of things outside sporting and cultural events. We did not have time to go into other matters during the speech made by the hon. Member for Washington and Sunderland West, but I would be interested to know how she feels about them.
To save any misunderstanding, I make it clear that I am not arguing from a personal interest perspective, but there is often a big hoo-ha in the press when a limited edition of designer handbags goes on sale in Selfridge’s or some other big department store, and there is a huge queue outside to buy the 25 available. Alternatively, Buzz Lightyears go on sale at Christmas—everybody wants one, but there are hardly any left. Massive queues form outside overnight. The lucky 20 dash in and buy the few available and within five minutes flat the product is on eBay being sold at 20 times the price because the person who bought it knows that there is a much bigger demand than the shop was able to accommodate.
I am not entirely sure whether the hon. Lady or the hon. Member for Dudley North are suggesting that, from their party’s perspective, it is the Government’s job to start regulating all these matters, so that if somebody buys somebody else’s intellectual property and then uses the free market to sell it at 25 times the price, the Government should stop that. If the hon. Lady or the hon. Gentleman are suggesting that, I should like them to stand up and say so; if they are not, perhaps they will explain what the difference is between somebody who buys a ticket to an event and somebody who buys a limited edition of a Buzz Lightyear, a handbag or anything else. Perhaps my hon. Friend the Member for Hove could do the same. I see no difference at all. It seems to me that once the Government go down the road of controlling the market in tickets, they are opening up the floodgates, or a slippery slope, of intervening in every single nook and cranny of the commercial world.
Philip Davies
My hon. Friend makes a good point about what constitutes a “real fan” in these matters. If somebody is prepared to pay £2,000 or £5,000 for a ticket to a concert, I would argue that it provides the best example of a real fan. Nobody is going to pay that kind of money for a ticket to an event in which they are not really interested. It seems to me, then, that the free market and ticket touting help the real fans to find their way to the front of the queue rather than get clogged up by people who might be buying on a whim because the tickets are rather cheap.
The hon. Lady says that she is trying to help the organisers and others to sell the tickets for the benefit of real fans, but perhaps she should reflect a bit further. Some of the concert and sporting promoters should also reflect on the part of the ICM opinion poll showing that 71% of people agreed that too many tickets for major sporting and cultural events were allocated to corporate sponsors, hospitality packages and VIPs. On this particular matter, I tend to agree with my hon. Friend the Member for Hove, who would presumably say that these are their tickets and they are entitled to give them to whomever they want. I would not gainsay that in this particular case. It is a bit galling, however, for people to be lecturing everybody on how they want the real genuine fans to have the tickets at a price they can easily afford when they are some of the worst when it comes to real fans not getting their tickets, because of the “prawn sandwich brigade”.
Mike Weatherley
Would my hon. Friend care to meet some of the music managers with me and be lectured by them? Perhaps we could also invite some real and true fans to come along to express their opinion so that we get a breadth of viewpoint. I wonder whether the Minister would also like to accompany us on this particular venture.
Philip Davies
My hon. Friend makes a tempting offer and it would be churlish of me to turn it down, so I look forward to receiving that invitation. I am encouraged: the longer I speak, the better the invitations I get. That encourages me to keep going a little while longer. I do not mind the free market—if anyone has a better offer, I would be prepared to hear it. I can assure my hon. Friend that I have already heard these arguments, as the Select Committee heard the views of promoters. I suspect that even the mere mention of my name to a certain Harvey Goldsmith is likely to give him a near-heart attack. Some of the spats that he and I had—not just in the Select Committee, but on radio interviews afterwards on the issue—seem to have done his health more harm than good. I am certainly aware of the arguments, but I was not persuaded by them.
My hon. Friend the Member for Bury North made a good point about who the real fans are in this case. Who are we trying to protect? Who are the people who are losing out as result of ticket touting? I have never worked out who the losers are, but they are certainly not the promoters. They do not lose out in any shape or form from ticket touting and nor do the artists.
Philip Davies
My hon. Friend is ingenious as ever. That might be something that the Procedure Committee will want to consider. I suggest that my hon. Friend mentions it to our right hon. Friend the Member for East Yorkshire (Mr Knight). I shall look forward to that system being introduced.
I do not think that things work against the interests of the promoter. The promoter gets all the income that they were ever going to get in the first place, so the promoter is looked after. The issue is then whether things work in favour of the consumer. As I hope I have argued, the fact that the consumer can buy tickets right up to the end means that it works in their best interests, too. I must say in passing that if ticket touting is such a big issue for concert promoters and sporting promoters—if it is the be all and end all and the biggest single threat to their business—it is a wonder that they do not do more imaginative things to try to stop the antics of ticket touts. My hon. Friend the Member for Hove said that it should be up to them what they do, and it is. Perhaps, rather than selling all the tickets in one go right at the start so that they are sold out in five minutes flat, which provides a perfect market for the ticket tout because no tickets are on open sale, why not sell tickets gradually week by week, so that there are still some tickets on open sale right up to the day before the concert? There would therefore be no market for the ticket touts.
I do not think that the solutions to the problems lie with more legislation, but of course that is what the Labour party always reaches for. If Labour Members perceive a problem—for the avoidance of doubt, I am not saying that there is a problem—they think the only solution is more Government legislation, more Government interference and more of a nanny state. The solutions to these things are often in the hands of the promoters and I want to see an explanation of why more promoters do not sell tickets bit by bit, week by week and day by day, so that tickets are still available on the open market the day before. There would then be no market. Perhaps the hon. Member for Dudley North could explain what is wrong with that solution. I see that he does not want me to give way, so perhaps I have talked him round. Perhaps this is a triumph that I did not anticipate. He appears not to disagree with me, so I shall leave it at that.
I want to refer to the Office of Fair Trading. People seem to think that not allowing the person who owns the property to set the price will make the price more expensive for the consumer. I take issue with that, because when I had the pleasure of working for Asda, it challenged the net book agreement. I do not know whether hon. Members remember the net book agreement, which allowed publishers to set the price of books and which prevented anyone else from selling the book at a different price.
I presume that my hon. Friend the Member for Hove supports the net book agreement, because the book belongs to the publishers, who should therefore be able to force everybody to sell it at a particular price. At Asda, we thought that that was against the interest of the consumer, that it was a protection racket and that it flew in the face of the free market. We took our case to court to argue that we should be able to sell books at the price that we wanted to sell them at and that there should be a free market. After a lot of to-ing and fro-ing and a lot of expense, I am delighted to say that Asda won its case and the net book agreement was broken.
What has been the upshot of the end of the net book agreement? If the argument advanced by the hon. Member for Washington and Sunderland West holds, prices would have risen: people would have abused the system by charging all sorts of prices. The nice, kind publisher would have wanted as many people as possible to read the book, and would have sold at the cheapest possible price, while the nasty retailers would have hiked up the price to increase their profits. The exact opposite actually ensued. Since the net book agreement ended, book prices have decreased, so breaking that restriction worked in the best interest of consumers. I do not see the difference between books and tickets, because the principle is the same. The free market won out in the courts, and I hope that it will continue to do so.
Mike Weatherley
My hon. Friend has set out a good economic analysis. Does he accept that in commercial terms there is such a thing as price differentiation in different markets for various reasons by the producer for long-term commercial purposes?
Philip Davies
Indeed. My hon. Friend has made some perfectly reasonable points, but I happen to disagree with them. Most of the problems that he has identified can be solved by the industry itself, and I have made some imaginative suggestions. If ticket touting is such a big issue, tickets should be sold on the open market by auction, as my hon. Friend the Member for Christchurch has suggested, which would maximise income and get rid of ticket touts, who would have no business.