Digital Markets, Competition and Consumers Bill

Richard Thomson Excerpts

2nd reading
Wednesday 17th May 2023 Commons Chamber

[Richard Thomson (Gordon) (SNP)]

The SNP welcomes very much the aims and objectives of the Bill, which broadly speaking fit well with the enhanced protections we have been calling for in the online space for some years.

For markets to be effective, they need a number of things, chief among them good market information for those participating, low barriers to entry, trust, the rule of law and a means of enforcing contracts where they are made. As the Minister alluded to, when the online marketplace emerged, there was always a risk—especially as it deals with entities that span several jurisdictions—that, for all its opportunities, it would become if not exactly a dystopian wild west, then certainly a less well-regulated space than physical trading spaces, which are more visible and more easily influenced by existing regulations. Given all the leaps and bounds that there have been in e-commerce, there is a need for the regulation of that marketplace to catch up and to rebalance it in the interest of consumers.

The Minister was correct to say that big does not always equal bad, but it is past time that we recognised that large digital entities with a significant public affairs presence can go around and say the right things, and even if their practices are not at variance with that, they can appear to be beyond the reach of and unbound by the obligations placed on other smaller market actors outside the digital space. That has long been an issue of concern, and anything that helps to rebalance that situation is a good thing.

We believe that conferring powers and duties on the Competition and Markets Authority to regulate that competition responsibly; updating powers to investigate and enforce both competition law and consumer protection law, where needed, and to resolve disputes; and enhancing protections in respect of unfair practices such as subscription traps and prepayment savings schemes, are good things in and of themselves and we welcome them.

To set out the scope of why those powers are necessary, recent figures from Action Fraud estimate that elderly people lose £1 million a day in the UK through online scams. The consumer organisation Which? estimates that one third of people in the UK experience at least one problem with a product or service each year, at an estimated cost of £54 billion, which is a tremendous drag on the economy. It prevents that money from being spent more productively in the economy, it reduces confidence and in many ways it reduces the competition that we would all like to see.

It is important to ensure that when people engage in the online market space they can do so with confidence, and we must recognise the role that the state has to play in that. No amount of competition can ever replicate what the state can do to act as the referee where necessary in this space, using a light touch. We very much welcome what the Government are setting out, particularly in defining organisations that have strategic market status and the additional responsibilities that will accompany that status.

The Bill goes a considerable distance to achieving those things but, given the scale of scams and unfair practices that, sadly, we witness on a daily basis, we think more needs to be done and that the Bill needs to go further in some respects. Like those on the Labour Front Bench, we believe that there are other areas where the Bill needs to go further.

At the risk of being criticised for making an unfavourable comparison with the Beelzebubs at the European Commission, there are many provisions in this Bill regarding firms with strategic market status that are broadly similar to those in the EU’s Digital Markets Act. The Bill falls short in that it does not explicitly include an equivalent to the EU’s right to redress, which would allow consumers to be paid with damages where they are misled by traders. Although the Bill gives the Secretary of State the power to do that in future through secondary legislation, it leaves a gap now, and there is the risk that that right will, over time, be watered down or removed entirely because there is no commitment to introducing it. If the ministerial team offer me some assurance about that, we can maybe explore it further in Committee, but that matter threatens to leave UK consumers behind.

The dangers there ought to be clear. Just last month, it was revealed that thousands of people from the UK who found themselves stranded in Dover following delays in coach trips faced losing their entitlement to compensation amid what was being billed as the “bonfire” of EU regulations. Rocio Concha, the director of policy and advocacy at Which?, noted that it is clear—or it was at that point, at any rate—

“that the government does not…have a firm enough grip on the extent of legislation which is at risk of simply slipping off the statute books by mistake.”

I welcome the Government’s change in tone last week, but right to redress is nevertheless an important consumer protection, and we certainly do not want to be in a position where our consumers have less leverage in that sense than their counterparts elsewhere in Europe.

Another area in which we believe the Bill should be getting its feet wet is greenwashing. It is not just in financial losses or deficient goods and services that consumers can be badly let down; it is also in goods marketed under misleading pretences, particularly when it comes to their environmental credentials. The Bill does not set out standards and practices that should be adhered to when making environmental claims. To give an example, in February, the Corporate Climate Responsibility Monitor found that many companies were involved in making misleading claims about their plans to tackle global warming and climate change. Sustainability is increasingly important for consumers choosing where to spend their money—particularly younger consumers—so it is vital that measures are put in place to ensure that people can have confidence in the claims being made for products, rather than being misled, wittingly or otherwise.

In terms of how the European Union is tackling that, around 230 separate sustainability labels and 100 green energy labels are commonly used across the EU, each with vastly different levels of transparency. Half of them offer weak or non-existent verification and 40% have no supporting evidence at all. The situation in the UK will be similar. Ensuring that labels and claims can be treated as credible and trustworthy would allow consumers to make better-informed purchasing decisions and boost the competitiveness of businesses that want to play a responsible role in the marketplace in terms of driving up standards to meet consumer demand. I urge Ministers to look at what the Commission is doing in that respect because this is a sufficient deficiency and a missed opportunity to make the Bill better than it already is.

The next point that I wish to endorse is one that was made by the right hon. Member for Calder Valley (Craig Whittaker) about charity lotteries. They do an awful lot of good, they give people an awful lot of enjoyment and they raise an awful lot of money for good causes. They are already in a very highly regulated marketplace, but we are concerned that the legislation could, in its present form, have a detrimental impact on their ability to raise funding and to give money to good causes. That concern applies in particular to clauses 148 to 253, which would—at least in my reading of them—introduce a significant number of new requirements on subscription products and pre-contract information. Schedule 19 already rightly contains a number of operators in the economy that are deemed sufficiently well regulated to be exempt from the requirements that the Bill would place upon them. I suggest that charity lotteries also fall into that category, and I urge Ministers to give that due consideration and make the necessary changes to schedule 19 to make it crystal clear that charity lotteries are exempt.

Another missed opportunity is on drip pricing, whereby companies add additional fees and costs that were not clearly stated at the beginning of a transaction. That tactic is commonly used by some airlines: the price given at the start bears little resemblance to the price that appears at the end, once the consumer has paid for everything that they assumed would come automatically with stepping on an airliner. The US is planning a crackdown on that through the Junk Fee Prevention Act. It would be a missed opportunity if the UK Government did not follow suit in the legislation before us.

I welcome the commitment to tackling fake reviews, which can cause a great deal of distress and harm. Many can be absolutely malicious—not on a personal level but in trying to discredit competitors and therefore reduce competition. That practice certainly requires a different approach in legislation, but it is unclear at this stage how the Bill would seek to deter it. If any ban is to work, it will have to be enforceable, it will need to have teeth and there will need to be appropriate redress.

[John Redwood]

I think we are all united in wanting to stop fake and damaging reviews, which are so unfair, but has the hon. Gentleman thought about how we would actually do it? Defining them, and deciding who judges that they are such, is not easy.

[Richard Thomson]

The right hon. Member is absolutely right that it is not easy, but that does not mean it is something that we should avoid trying to tackle, or that we should not try to come up with a way of improving the competitive environment. I am certainly more than happy to engage on an open and constructive basis with anyone about how we might do so.

[Kevin Hollinrake]

Will the hon. Gentleman therefore support our approach, which is to consult in parallel with the passage of the Bill through both Houses about things like drip pricing and fake reviews, so that we can have that open dialogue and make sure that we get the answers right, including to the questions posed by my right hon. Friend the Member for Wokingham (John Redwood)?

[Richard Thomson]

I thank the Minister for his intervention. Indeed, I would be quite happy to see what comes back from that consultation, because there are areas of real concern. If we can find consensus on how those matters can best be tackled—we might not be able to please everybody, but we can address them as best we can—that would be a welcome step forward.

In closing, the Bill is important for growth and competition, but also for consumer protection. The exchange that we collectively had just now on those matters was encouraging, and I would certainly like that spirit to continue in Committee. I do not think I have ever managed to successfully get something passed in Committee; I look forward to that changing.

[Alex Davies-Jones (Pontypridd) (Lab)]

Good luck!

[Richard Thomson]

I hear the hon. Member for Pontypridd say “Good luck”, but we will see how it goes. The Bill certainly does much that it needs to, but there are quite a few things that it misses; let us see what we can make it hit over the period ahead. As the Bill progresses, I look forward to working with others where it is possible to do so, in order to do precisely that.

Digital Markets, Competition and Consumers Bill (First sitting)

Richard Thomson Excerpts

Committee stage
Tuesday 13th June 2023 Public Bill Committees

[Kevin Hollinrake]

Q Sure, okay. Mr Upton, on subscription traps, do you not feel that the powers that the Bill affords the CMA on civil penalties will address some of the concerns you highlight of people trying to get around the rules, for example? Would that not be something it could act on when it sees gratuitous behaviour such as what you describe?

Matthew Upton: I think it could, but we worry that it will not in reality. It is quite difficult to decide, for example, what constitutes easy and timely exit from a contract. You cannot necessarily measure it incredibly specifically, and I could imagine enforcement being really complicated. I could imagine firms dragging their feet, despite the way powers would speed up the ability of the CMA to act, as I say, because the incentive structure is so great.

One reason for the growth of the subscription economy is that it is a great way to provide services, but another is that it is such an easy way to make money by trapping people in. That is our firm belief and what our evidence shows. I just think a simple default would be much more effective than basically having the CMA chasing its tail and chasing firms. It would not be of any detriment to good firms who want to provide really solid subscriptions that people should want to stay in.

[Richard Thomson (Gordon) (SNP)]

Q The EU has a right to redress for consumers, and there is a schedule in the Bill that would allow the Secretary of State to introduce that again in future through secondary legislation. Do either of you have any sort of sense of the extent to which UK consumers might be at risk of being at detriment compared with their EU counterparts while that secondary legislation is not in place?

Rocio Concha: Our view is that it should be on the face of the Bill. We do not know why the right to redress has not been transposed into the Bill. From our perspective, we do not want to leave it for the Secretary of State to decide once we have an Act. It should be included.

The other thing is that the right of redress does not cover all the practice in schedule 18, only misleading practice and aggressive practice. It does not really cover all the list of unfair practice in schedule 18. I think that the right to redress should also cover that.

[Richard Thomson]

Q On fake reviews, the challenge that came up at Second Reading was about how we might define, judge and act on them. How do you think it is best to tackle the problem of fake reviews? Have you any suggestions while we are engaged in this consultation?

Rocio Concha: You mean how—

[Richard Thomson]

How could we legislate create the framework by which the problem of fake reviews could be best addressed?

Rocio Concha: I think it needs to be in the list on schedule 18, and there is a very simple way to draft that amendment. We are going to suggest an amendment to help you with that, so I do not think that it is a major difficulty to include it on the face of the Bill.

[Dean Russell]

Q You are both at the coalface for consumers in terms of the challenges around all the issues addressed by the Bill. Can you briefly share some real-life examples of why the Bill is so important and what difference it will make to consumers?

Rocio Concha: I can give you some examples from the past so that you can see what consumers face. I already talked about the secondary ticketing problem, but I will give you another example. During covid, there were a lot of issues about people getting their refunds that they were entitled to by law. Many people could not really get them. I will give you another example on the digital side—that was on the consumer side.

At the moment, as you have heard from the CMA, digital advertising is basically controlled by two companies, Google and Facebook. Google has doubled its revenue from digital advertising since 2011 and Facebook used to make less than £5 per user—more recently, it has been around £50 per user. Google charges around 30% more for paid-for advertising than other search engines. All that cost translates into the products that we buy. We expect that once this pro-innovation, pro-competitive regulatory framework is put in place we will see it translate into prices.

We will also see it translate into more choice, in particular on data. At the moment, it is very difficult for consumers to have a choice on how much of our data is used for targeted advertising. You will have seen examples of that. When we talk to consumers in particular on the issues surrounding data, they feel disempowered. When we talk to consumers about the problems that they face in some of the markets where there are high levels of detriment, they also feel disempowered.

Matthew Upton: To be clear, there is a lot of good in the Bill. I echo Rocio’s first comments that there are a lot of positives. It has been a long time coming, and is a testament to the civil servants in the Department who have stuck with it. The main lens through which we see the impacts of the potential changes in the Bill is the cost of living. It is not exactly headline news that people are struggling with their bills. One of the main measures that we look at is whether one of our clients is in a negative budget: whether their income meets their essential outgoings. About 52% of our debt advice clients can no longer meet their essential—not desirable—outgoings with their income.

There are two areas where the Bill can make a real difference. One of the frustrations is that a debt adviser will go in detail through someone’s income and where they spend their money, helping them to balance their bills, and so on. You see the impact of other Government interventions, such as energy price support, putting money in their pockets and uprating benefits. You are combing through their expenditure and you find something like a subscription trial taking £10 a month—a huge amount for a lot of our clients—unnecessarily out of their account. They did not even know that it was there. Often, it is people who are not online, are not savvy, and are not combing their bills every month because they have a lot on. That is hugely frustrating, and things like this, especially if strengthened, could tackle that.

You will see similar things where people are just about balancing their monthly income with their expenditure and they get hit by some big scam bill or are let down by a company. Such companies are too often not held to account in the right way. It is a bit of a tangential example in some ways, but the hope is that the CMA’s increased ability to act and, in effect, to disincentivise poor behaviour towards consumers will lessen such instances as well.

Digital Markets, Competition and Consumers Bill (Twelfth sitting)

Richard Thomson Excerpts

Committee stage
Tuesday 4th July 2023 Public Bill Committees

[Neil Coyle]

With that reassurance of looking at this further over the summer and to improve on where things stand, I will take the Minister at his word. The idea that we can support everything in a product safety review that will start we know not when feels a bit like missing the bus—or missing the stagecoach, to stick with the analogy. The powers need to be in the Bill to ensure that when the product safety review is done, the vehicle is already available to enable dangerous or counterfeit goods to be removed, but given his reassurance, I beg to ask to leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 217, as amended, ordered to stand part of the Bill.

Schedule 18

Commercial practices which are in all circumstances considered unfair

[Richard Thomson (Gordon) (SNP)]

I beg to move amendment 68, in schedule 18, page 343, line 2, at end insert—

“32 Making claims about—

(a) the environmental benefits, or

(b) the sustainability (as defined by section 234(1C)) of a product or service which are not based on evidence which can be verified by a court.”

This amendment seeks to ban the practice of “greenwashing”. It would include the making of unsubstantiated claims about the sustainability of products and services an unfair commercial practice.

[The Chair]

With this it will be convenient to discuss amendment 69, in clause 234, page 157, line 29, at end insert—

“(1A) The Secretary of State must consult on a definition of sustainability for the purposes of paragraph 32 of Schedule 18.

(1B) A consultation under subsection (1A) must—

(a) set out which products and services can be labelled sustainable; and

(b) require the definition to comply with international standards.

(1C) Following a consultation under subsection (1A) the Secretary of State must by regulations amend this Chapter to add a definition of sustainable.”

This amendment seeks to ban the practice of “greenwashing”. It requires the Government to define which products and services can be labelled “sustainable” and requires that this definition complies with international standards.

[Richard Thomson]

It is a pleasure to serve under your chairmanship, Mr McCabe. With your indulgence, if it is appropriate, I will also speak to amendment 69 and am happy to speak to amendments 115 and 116.

[The Chair]

We will stick to amendments 68 and 69.

[Richard Thomson]

Thank you for your guidance, Mr McCabe.

I have not yet spoken in Committee, and the reason for that is simple. As I said on Second Reading, from a Scottish National party perspective, we think that the Bill is generally speaking a good Bill. Our concern is primarily with the bits that we feel are missing, so the amendments that I will speak to this morning and afternoon are with a view to fill in some of the potholes that we see in the road for the Bill.

Amendments 68 and 69 would tackle the phenomenon of greenwashing. By that, I mean the practice by which companies use advertising and/or public messaging to appear more eco-friendly, whether in the generality or with regard to specific products, than is actually the case. The amendments would compel the Secretary of State to consult on a definition of sustainability for these purposes that is in line with international standards and then to amend the relevant chapter to add that definition to the Bill, and to add greenwashing to the schedule 18 list of practices which are in all circumstances considered unfair.

--- Later in debate ---

[Kevin Hollinrake]

Amendments 68 and 69 would add the practice of greenwashing to the list of banned practices in schedule 18, and would introduce a requirement for the Government to consult on the matter. I thank the hon. Member for Gordon for his amendments, and I absolutely agree that consumers should not be misled. I admire his commitment to recycling, which is admirable. I wondered whether I should touch on that, given the difficulties that the SNP has got into with its deposit return scheme, but—

[Richard Thomson]

I thank the Minister for that sideswipe, but it would be a great deal easier for the Scottish Government to comply with an English-designed scheme if that scheme was actually in existence for us to emulate. Absent our deposit return scheme, we are stuck with the recycling schemes that we have, and I wonder whether the Minister will get to the point.

[Kevin Hollinrake]

I was just referring to the hon. Gentleman’s point. I will briefly say that our perspective is that a nationwide scheme would be best for business.

Misleading consumers about the environmental qualities or impact of goods and services in a way that causes, or would likely cause, consumers to take a different decision is already against the law. Furthermore, under clause 187, when the CMA gives a provisional notice to a person in respect of an infringement of the unfair trading provisions, the CMA can require the respondent to provide evidence to substantiate the claims that they make to consumers. That meets the shadow Minister’s requirement. It is against the law to mislead, and as she says, the CMA’s draft guidance on sustainability agreements between businesses, which aim to ensure that environmental goals are achieved, will give greater clarity on these issues. Those interventions are already significant. The Government’s priority is to ensure that interventions support our environmental goals; we would then observe their impact before taking further steps. I hope the hon. Member will withdraw amendment 68 on that basis.

[Richard Thomson]

I am sorry to disappoint the Minister, but this is an issue of fundamental importance, and if I withdrew the amendment, it would be an opportunity missed. Of course, we could go through any number of proposed amendments to the Bill and say that there is already legislation in place that in some way tackles that issue. Of course it is true that there are measures on this issue, but there is still a proliferation of claims out there that have not been tackled by existing legislation. I know the Minister is a keen advocate for ensuring that markets work as effectively as they can, and for allowing markets to reach conclusions. The amendment is simply a tool that would allow Ministers to act in the interests of consumers. It would be a missed opportunity not to push it to a vote, and not to include it in the Bill.

Question put, That the amendment be made.

--- Later in debate ---

[Seema Malhotra]

I am pleased to speak to amendment 116, tabled by my hon. Friend the Member for Pontypridd and me. I will also touch on amendment 125, tabled by my hon. Friend the Member for Bermondsey and Old Southwark. They are similar provisions, and he will want to make his own arguments for amendment 125.

Amendment 116 adds the practice of commissioning fake reviews, offering to provide the service of writing fake reviews, and displaying consumer reviews without taking reasonable steps to verify their accuracy to the list of unfair commercial practices. Amendment 125 would similarly add fake reviews to the list of banned practices. We support both the amendments, but I will speak to amendment 116 in more detail, as it provides a more comprehensive legislative basis for banning fake reviews, and was recommended by the consumer group Which?.

When the Bill was published, the Government announced with much fanfare that they would introduce provisions banning the unfair commercial practice of fake reviews. However, nowhere in the Bill is there any measure that bans fake reviews. The supposed banning of fake reviews can be found in clause 234, which gives the Secretary of State the power to add to the list of banned practices. Unless the Minister corrects me, all we have is a promise from the Government that at some point in the future—beyond 2025—fake reviews might be banned. As Which? said during the Committee’s evidence sessions,

“We do not think that we should wait. Clearly, fake reviews are harmful, so the buying, selling and hosting of fake reviews should be included in schedule 18.”––[Official Report, Digital Markets, Competition and Consumers Public Bill Committee, 13 June 2023; c. 13, Q16.]

It was not just consumer groups that expressed that sentiment; the British Retail Consortium also stated:

“We are concerned about fake reviews. We support the banning of them. We wish that what the Government propose for them was on the face of the Bill.”––[Official Report, Digital Markets, Competition and Consumers Public Bill Committee, 13 June 2023; c. 49, Q78.]

I would be grateful for the Minister’s explanation of why the Government have left a ban out of primary legislation. One view is that the Government intended to include a ban, but ran out of time. Well, we have time to catch up during the passage of the Bill. Retail and consumer groups consider this measure very much noticeable by its absence, and it is important and significant that we address it during the passage of the Bill.

I have no doubt that the Minister will stress the need for further work and consultation on the issue. If so, perhaps he could also reflect on the considerable evidence of consumer detriment caused by fake reviews. Which? research from 2020 found that consumers are far more than twice as likely to buy poor-quality products that have been boosted by fake reviews. That affects the Minister’s constituents, mine, and those of every Member of this Committee.

As the CMA has noted, the average UK household spends £900 a year as a result of being influenced by online reviews. That demonstrates how significant the financial damage of fake reviews can be. In the Department for Business and Trade’s research from April this year, 11% to 15% of reviews in the category that it assessed were fake. That is the Government’s own research. The evidence is clear: action on fake reviews is needed now to protect consumers from their negative consequences. I would go so far as to say that the Opposition are doing the Government a favour by introducing these amendments. We have done the Government’s work for them.

I urge the Minister to support the amendments. Perhaps he will want to bring forward his own, as the Government are known to take good ideas when they see them, many of which they take from the Opposition. We understand that there has been significant dysfunction in Government, which may have got in the way of their doing the work that the country needs them to do. I therefore urge the Minister to support the amendments. He may also want to bring forward his own amendments at a future stage of the Bill or in the other place. I jest, with good reason, but we are not precious; we just want the right thing to be done. I hope that in his response, the Minister will confirm what action the Government will take during the passage of the Bill.

[Richard Thomson]

I very much support amendment 116, to the extent that I withdrew my attempt at an amendment that would have countered fake reviews. It is clear that fake reviews are a matter of real concern, not just for reputable companies, but for consumers, who like to rely on customer feedback before making some of their most important financial choices. Schedule 18 defines and sets out unfair practices, and it is only right that fake reviews be added to them. We again come back to the fundamental principle that if a market is to work effectively and efficiently, people need access to timely and accurate information. That goal of having accurate information in the marketplace is subverted considerably when fake information and misinformation are allowed to abound.

--- Later in debate ---

[Seema Malhotra]

Under clause 224, as the Minister says, the consumer will be able to enforce their right to redress relating to unfair commercial practices, subject to conditions, including that they have entered into a relevant contract, that the trader has engaged in a prohibited practice, that the prohibited practice was a significant factor in the consumer’s decision to make payment, and that the product concerned is not of an excluded type. Those are important provisions, including in the context of our debate about greenwashing. That is why it is important that we take forward the issues we have debated. None the less, we welcome the clause and these important provisions.

Question put and agreed to.

Clause 224 accordingly ordered to stand part of the Bill.

Clause 225

Rights of redress: further provision

[Richard Thomson]

I beg to move amendment 67, in clause 225, page 152, line 30, at end insert—

“(4A) The Secretary of State must by regulations make any further provision necessary to ensure that the rights of redress available under this Chapter are equivalent to, and not lesser than, those available under the Consumer Protection from Unfair Trading Regulations 2008 (S.I. 2008/1277).”

This amendment seeks to ensure that the “Consumer Rights to Redress” that will be set out through secondary legislation cannot offer a reduced level of the protection than the Consumer Protection from Unfair Trading Regulations 2008.

[The Chair]

With this it will be convenient to discuss amendment 114, in clause 225, page 152, line 33, at end insert—

“(7) The Secretary of State must—

(a) prepare a report on the merits of introducing a consumer right to individual and collective redress by regulations set out in 225(1), and

(b) lay a copy of this report before Parliament.

(8) The report must be laid within the period of 12 months beginning with the day on which this Act is passed.”

This amendment would require the Secretary of State to prepare and lay before Parliament a report on the merits of introducing a consumer right to individual and collective redress through secondary legislation, as is the case in EU member states.

[Richard Thomson]

As the explanatory statement sets out, amendment 67 seeks to ensure that the consumer rights to redress introduced through secondary legislation by Ministers cannot offer less protection than the Consumer Protection from Unfair Trading Regulations 2008. That statutory instrument was effectively the successor to the Trade Descriptions Act 1968 and was designed to implement the unfair commercial practices directive as part of a common set of European minimum standards for consumer protection. Consumers, not just in Europe but throughout the UK, have benefited immensely from those protections. It is important as a point of principle that as legislation is repealed or evolves, there should be no inadvertent reduction in baseline consumer protections. There should be a reduction in consumer protections only where the Government deliberately choose to do so and we have an open debate.

The amendment is very much about ensuring that nothing slips down the drain inadvertently in terms of consumer protection. If the Government are not minded to accept it, what existing protections will they unwittingly let fall by the wayside? The amendment would capture the baseline level of protection through future secondary legislation. I look forward to the Minister’s remarks.

[Seema Malhotra]

I am pleased to speak to amendment 114, which stands in my name and that of my hon. Friend the Member for Pontypridd. I will also make reference to amendment 67, tabled by the hon. Member for Gordon.

Amendment 114 would require that the Secretary of State prepare and lay before Parliament a report on the merits of introducing a consumer right to individual and collective redress through secondary legislation, as is the case in EU member states. Amendment 67 would ensure that the consumer rights to redress set out in secondary legislation cannot offer less protection than the Consumer Protection from Unfair Trading Regulations 2008. We support the principle of amendment 67, which would have a similar effect to amendment 114 by ensuring a more robust consumer right to redress.

More specifically on amendment 114, I refer the Minister to the written evidence of Which?, which notes that

“the Bill states that ‘Consumer Rights to Redress’ may be provided for in future secondary legislation, so it will give the Secretary of State powers to amend these rights. These rights are fundamentally important, as they include payment of damages when a trader misleads a consumer. We want assurances that they will not be downgraded as a result of this process, and a commitment from the Government to strengthen redress procedures when these new regulations are drafted.”

Amendment 114 would require a commitment from the Government to report on doing that, aiding the process of strengthening redress procedures when new regulations are drafted. I urge the Government to support amendments 114 and 67, and to ensure that consumer rights to redress are as strong as they can be, particularly in an increasingly digital economy.

[Kevin Hollinrake]

Amendments 67 and 114 deal with consumers’ private rights to redress. I agree with the hon. Members for Feltham and Heston and for Gordon that it is vital that consumers have robust private rights of redress.

Amendment 67 would limit changes by regulation to the consumer rights of redress to those that are equivalent to the remedies in the CPRs—the Consumer Protection from Unfair Trading Regulations 2008. The Bill includes powers to amend rights of redress. That could include how such rights are exercised; the powers could also be used to make those rights clearer and simpler. Those would be positive changes for consumers that might not meet the test of equivalence to the current regulations that the amendment would impose. We would like to retain the ability to exceed the existing private redress provisions, if appropriate, which may encourage more consumers to make use of these rights. The first regulations made using the power will be to create the new regime to replace the current private redress provisions in the CPRs. Accordingly, those regulations will be subject to parliamentary approval via the affirmative procedure, thereby providing for appropriate parliamentary oversight of use of the power.

I turn to amendment 114. The courts already have the power to make an enforcement order against an infringer, or to accept undertakings from them to provide redress to affected consumers, through the measures in part 3. Enforcers can also accept undertakings from infringers to provide redress to affected consumers. For example, in 2021 the CMA secured an undertaking from Teletext Holidays to pay over £7 million in outstanding refunds from package travel trips cancelled due to covid-19.

The Bill will make the power to require enhanced consumer measures directly available to the CMA. Consumers also already have individual private rights of redress. In the “Reforming competition and consumer policy” consultation, we consulted on whether to introduce a right for consumers to bring collective redress. Responses were mixed, with concerns raised about unintended consequences such as the creation of a claims culture and inadvertently disincentivising the bringing of proceedings by consumer groups.

The hon. Member for Feltham and Heston referred to the EU situation. The outcome, however, is similar to the desired situation under the EU’s directive on collective redress, which requires member states to designate entities, such as consumer organisations, that can bring actions for collective redress on consumers’ behalf. The EU does not mandate that member states introduce direct rights for individual consumers to bring an action for collective redress.

We will keep the evidence under review, but our priority is to embed the CMA direct enforcement regime and understand the impact that it makes. On that basis, I hope that hon. Members will not press their amendments.

[Richard Thomson]

With regret, I am not minded to withdraw amendment 67. I hear what the Minister says about how the Government may wish to go beyond existing levels of consumer protection. That is welcome where appropriate, but I do not see anything in the amendment that would prevent Ministers from doing that. The key element in the amendment is to capture a baseline level of protection, equivalent to what was in the 2008 regulations, to ensure that there is nothing that dips below that without a conscious decision to do so having been taken and debated. On the basis that there is nothing that would prevent the Government from enhancing the levels of protection at any time, I am keen to divide the Committee.

Question put, That the amendment be made.

Digital Markets, Competition and Consumers Bill

Richard Thomson Excerpts

Report stage
Monday 20th November 2023 Commons Chamber

[Madam Deputy Speaker]

I call the SNP spokesperson.

[Richard Thomson (Gordon) (SNP)]

My party broadly welcomed the Bill at its introduction and through Committee, and broadly speaking we still do. However, for our liking there remain too many gaps in consumer protection. The Bill does not include an equivalent to the EU’s consumer rights to redress when consumers are misled, and it does not baseline the protections that we had previously, which we think is a serious omission. Many consumers found that to their cost when their travel arrangements went haywire through chaos at the channel ports over the summer.

The Bill does not do enough to tackle greenwashing. As we have heard, there is a systemic failure to tackle drip pricing and subscription traps. We are also still unclear about how the Government intend to tackle the scourge of fake reviews; although secondary legislation could be introduced, the scope of the sanctions that could be brought to bear against the perpetrators would inevitably be restricted.

Rather to my surprise, we have 175 Government amendments to the Bill. That seems rather a lot to be bringing in. It can be gently elided over that this is a Government who have been listening carefully to all the arguments put, but, to be perfectly honest, I think it shows that this has become something of a Christmas tree Bill. It would have been better to have had much more parliamentary scrutiny in Committee of some of the things we now find coming in, no matter how well-intentioned they are.

A number of amendments to the Bill do cause me concern, including the series of amendments that changes the mechanism for appealing the Competition and Markets Authority’s decisions. In our view, Government amendments 6, 7, 10 and 30 will water down the Bill’s effectiveness, allowing tech companies described under the Bill as the most powerful firms and dynamic digital markets to be able to challenge the CMA’s decisions if they do not believe that they are proportionate.

Government amendments 51 to 53, 55 and 56 also have that effect, since they will prevent certain appeals by big-tech firms of decisions made by the CMA from being held to the judicial review standard. I am unpersuaded by the arguments that we have heard so far about that. We fear that, in practice, when a decision is taken that is not, for whatever reason, to the liking of big-tech companies with rather large budgets—to take one entirely at random, we have Apple, which makes profits and turnover yields that are bigger than most countries’ GDPs—they will inevitably be able to tie those decisions up in the courts for quite some time, all the while being able to secure whatever advantage they had which the CMA had judged they got unfairly. The CMA has warned that changing the appeal mechanism could lead to such a set of drawn-out legal battles and quite an adversarial relationship with the firms that it seeks to regulate, which I would venture is far removed from the Bill’s original intention.

It is unusual that I should ever pray in aid the other place in a political argument, but last month the House of Lords Communications and Digital Committee called on the Government to maintain the JR standard for all appeals. It is therefore worrying, if not entirely surprising, that the extensive lobbying that some of the bigger tech companies have subjected us to seems to have found the ear of the Government.

If the UK Government’s amendments 6, 7, 10 and 30, which seek to allow firms with strategic market status to appeal against CMA decisions, are accepted, that will essentially undermine the CMA’s job and ability to protect consumers. Those amendments would allow big tech firms to appeal against decisions taken by the regulators on significant issues such as blocking mergers and issuing fines simply on the basis of their feeling that they may not be proportionate. As I say, they can certainly afford to spend huge amounts of money on legal representations to quibble with these decisions, particularly if the fines or deprivation of the opportunity to make lots of money mean that they feel it is worth spending that money whatever the eventual chances of success are.

This is in addition to the letter that Baroness Stowell wrote to the PM last month warning that the UK Government must not “undermine” the Competition and Markets Authority, noting that these amendments would

“favour those with an interest in delaying regulatory intervention”

and give greater power to avoid scrutiny to the tech firms

“with the greatest resources”.

The UK Government should not be ignoring these warnings, and we believe that this is a detrimental addition to the Bill. This position was also backed up by Which? in April last year. In our view, these amendments show that the Government have done the exact opposite of sticking to their guns on this.

I am mindful of the time—as are you, Madam Deputy Speaker—so I shall come to the amendments that I believe we will be voting on later. Labour amendments 187 and 188 would enable the Competition and Markets Authority to consider any significant benefits, due to a combination of factors, that might result from a breach of the conduct requirement. We think that strikes a reasonable and fair balance on where we would like the outcomes to be, and should the amendments be pressed to a vote, the SNP will be supporting them.

--- Later in debate ---

[John Penrose]

My hon. Friend is right: I may have been guilty of being too glass half empty, rather than glass half full. The new clause goes a very long way and enfranchises large chunks of the economy that perhaps have not been dealt with properly up until now; I just wanted to go even further and cover the entire economy. He is right to point out that the new clause does quite a lot, but it is half a loaf rather than the whole loaf, if I can put it that way.

My hon. Friend is also right to say that the accountancy —the measurement of the costs—is crucial. If we are trying to do one in, one out, we have to know the cost of the things coming in so that we can know what savings we have to find elsewhere. As I mentioned, the crucial thing is that we need to have an independent accounting body—an independent measurement body. That will require the Regulatory Policy Committee to be made a little more independent and to be given more arm’s length ability to set those accounting and measurement standards in a way that cannot be leant on by senior Ministers, senior mandarins or senior regulators. The committee needs to be able to look those people in the eye and say, “No, this is the way it’s got to be.” Like any good external auditor, it needs to be sufficiently at arm’s length to deal with that. If it does so properly, it will mean that any set of measurements can be relied on, both by my hon. Friend’s Committee and the rest of this Chamber. That is essential.

To bring my remarks to a close, if we do not adopt the system proposed in the new clause, we need a system that provides proper accountability for anybody who fails to hit these targets; proper measurement and independent accounting standards to make sure that Government and regulators cannot mark their own homework; and proper targets of some kind to make sure there is a standard to which Ministers must be held. I hope that my hon. Friend the Minister will be able to reassure me, and I look forward to his remarks.

[Richard Thomson]

It is a pleasure to follow the hon. Member for Weston-super-Mare (John Penrose), who made some very interesting arguments. In some of them, I heard echoes of the arguments that have been made by the Opposition during my few years in this place about trying to measure the effect that legislation has when it is passed. Amendments that seek to measure that effect routinely get knocked down, but there is a fundamentally useful point in what he says about the need to make sure that we are not suffering from unintended consequences and that the goals we are seeking are the ones that result, so that corrective measures can be taken if they are not.

Hansard records that on Second Reading, I was wished “Good luck!” by the hon. Member for Pontypridd (Alex Davies-Jones) when—perhaps intoxicated by an overly friendly and useful exchange across the Floor about the scourge of fake reviews—I thought we might get to a consensus that would allow something to appear in the Bill. Sadly, the hon. Member’s cynicism appears to have been well founded: there is certainly nothing about fake reviews in the Bill that I can see. I accept that the Government might amend that in future through secondary legislation—they are certainly able to do so—but as I said earlier this afternoon, that inevitably restricts the scope of the sanctions that can be levied for that behaviour.

I appear to have had a little more success in another area. In his opening remarks, the Minister said that when it came to additional gold-plating of the rules and regulations affecting charity lotteries and gambling for that purpose, there was a risk of charitable organisations being caught up as an unintended consequence of the legislation. I am absolutely delighted that the Government appear to have listened, and have tabled Government amendment 170, which

“excludes contracts for gambling (that are regulated by other legislation) from the new regime for subscription contracts”.

I very much welcome that amendment. On that basis, I will not seek to move amendment 228, which stands in my name and which I pressed to a Division in Committee.

A rather gruesome spectre was raised in the debate earlier—phantasms and fears that will not arise, apparently. That brings me neatly to new clauses 1, 2 and 3, which were tabled by the right hon. Member for North East Somerset (Sir Jacob Rees-Mogg)—a series of amendments that appear to be aimed squarely at a somewhat contested narrative surrounding the personal financial arrangements of somebody currently residing in a very small part of a jungle somewhere in Australia. Their appearance there is set to land them a fee that—if the scale of that bounty is as reported—would surely have every private banking manager the length and breadth of London fighting for their custom. When most of us speak in this Chamber about financial exclusion, usually we are talking about a lack of access to cash or about the ability to access one’s cash without a service charge at an ATM. We are talking about a lack of access to credit or to any kind of bank account, and very much not about those suffering the privations and indignity of having to deal with a bog-standard current account rather than being courted by Coutts.

[Sir Jacob Rees-Mogg]

The hon. Gentleman is absolutely right that this issue has come to people’s attention because of Nigel Farage. I will talk about that case in a moment, but what has emerged is that actually, quite a lot of people—and sometimes charities—who have views that banks do not like find that they are not able to get access to a bank account, which nowadays is a fundamentally important thing for people’s carrying on an ordinary daily life.

[Richard Thomson]

I thank the right hon. Gentleman for his intervention. There is already a multiplicity of legislation and entitlements—indeed, he appears to reference them in new clause 1—that can be used to tackle such circumstances when they arise, if indeed they do. I find it very encouraging that in drafting new clause 1, the right hon. Gentleman has alighted on the relevant provisions of the European convention on human rights, which provides a very useful earthing point for many of the fundamental rights that we hold dear and, indeed, are a bulwark of a civilised society. Perhaps we will see a similarly stout defence of them in future debates in this Chamber.

I very much welcome new clause 14, which will require companies to comply with requests for information from the Competition and Markets Authority when it comes to the pricing of motor fuel. On 9 November, the CMA published its first monitoring report on the road fuel market, and while 12 of the largest retailers responded to that request, I am given to understand that two did not. From my perspective and, I am sure, the perspective of many others wherever in this Chamber they sit, that is simply not acceptable. I am sure we can all point to large variations in the cost of petrol, diesel and other forms of motor fuel across our constituencies, sometimes in filling stations that are only a few miles apart or even within relatively close proximity. That is certainly a great source of contention for people right across my constituency, so the Government requiring retailers to provide the CMA with that information is an important strengthening of its powers, and one that we welcome.

New clauses 29 and 30, which stand in the name of the hon. Member for Pontypridd, seek to tackle subscription traps. I appreciate that the Government have tabled amendment 93, which seeks to tackle these traps by issuing reminders, and that is a welcome step forward. Nevertheless, I am bound to observe that SNP Members, at least, believe that a better balance could be struck by asking consumers whether they wish to opt in to automatic renewals or to variable rate contracts, rather than simply getting reminders about them, which will inevitably end up in the recycling bin or junk mail folder, even for the most attentive of consumers. Having to opt in would be far better and it would protect the consumer’s interest to a far greater extent than simply having the opt-out option emailed or mailed, or conveyed in some other way, in due course. If those new clauses are put to a vote, the SNP will support them in the Lobby.

[Sir Robert Buckland]

I hope to speak briefly, as the hors d’oeuvres for the pièce de résistance, which will be the speech by my right hon. Friend the Member for North East Somerset (Sir Jacob Rees-Mogg), who has tabled excellent amendments. Although I did not sign them, for which I apologise, I very much endorse and support his efforts in these areas. These are important matters that need to be dealt with, and this is the right forum in which to do so. I wish to speak briefly in summary about provisions that I spoke to in the first group and simply reiterate that the thrust of the new clauses I have tabled, and am supported in by a number of right hon. and hon. Members, is all about accountability.

New clause 24 seeks a review of the work of the Competition Appeal Tribunal and is all about making sure that that body is functioning as effectively and expeditiously as possible to deal with these important matters. The work of the tribunal has become progressively more scrutinised. I do not wish to cast aspersions on its chairs or members, who work extremely hard. It is an impressive body, which is looked upon internationally for its work. However, there is no doubt in my mind and in the minds of many others that there is more work to be done to streamline and improve the CAT’s processes if it is increasingly to be looked upon and relied upon as an important arbiter of issues relating to digital markets, among other things.

The consumer interests duty set out in new clause 25 is at the heart of what we are trying to do here. Coupled with that, new clause 26 seeks to allow claims for damages under part 4 of the Bill and is an attempt to reframe the way in which the Government are approaching the provisions on subscriptions, to which I have tabled a number of amendments. I am grateful to my hon. Friend the Minister and the Government for having listened and moved on that issue. However, it seems to put the cart before the horse a little to not allow claims for damages, but to put through exemptions that would mean that if I were to seek to terminate my subscription via Twitter, the company concerned would not be liable. It would be far better to have a general liability in damages and not to have such prescriptive clauses in the first place that would be liable to misinterpretation. I am offering the Minister another way of looking at it that would be less prescriptive.

I have to come back to the Minister on the point that I made to the Under-Secretary of State for Science, Innovation and Technology, my hon. Friend the Member for Meriden (Saqib Bhatti): there is an odd juxtaposition between different parts of the Bill, where we are told in one breath that primary legislation is not the appropriate vehicle for prescribing procedures, yet here we are prescribing in minute detail procedures relating to subscriptions in the Bill. My hon. and learned Friend the Member for Eddisbury (Edward Timpson) has made the point for me, and it is one we well know: secondary legislation allows for greater flexibility, so that if a new potential problem or abuse is identified in this fast-growing market, the Government would be able to plug the hole and deal with the subscription issue.

--- Later in debate ---

[Sir Jacob Rees-Mogg]

It is a pleasure to follow the hon. Member for Bermondsey and Old Southwark (Neil Coyle). I am also grateful to the Minister for his thorough engagement on these matters. He has been extremely diligent, helpful and, as always, courteous. Let me begin by declaring a sort of semi-interest. I do not think it is technically one that the Standards Commissioner would worry about, but Mr Farage and I both appear on a television programme under the auspices of GB News at about the same time of day—I follow him. I have no financial relationship with Mr Farage; we merely appear on GB News at a similar time of day.

It was Mr Farage who brought to the attention of the public the issue of de-banking. It is a great problem; if someone’s bank suddenly says to them, “We are not providing you with any facilities”, where do they go? It is very hard to go to a new bank. New banks do not want people who have been de-banked. Nigel Farage became in a way the poster boy for this issue, highlighting something that was affecting people up and down the country, affecting charities, and affecting businesses that have been to see me as a constituency MP in the past—people running certain types of business, who found that their banking facilities were withdrawn without any proper answer or explanation. A pawnbroker who came to see me had had his banking facilities taken away. His is a perfectly honest and reputable business, but inevitably it deals with a lot of cash, which makes banks nervous and, when they are nervous, they need to give that customer a proper explanation as to why they are no longer getting that service.

The hon. Member for Gordon (Richard Thomson), in an elegant speech, teased me for standing up for Nigel Farage as if debanking was not a common problem. He mentioned that Mr Farage is off in the jungle eating offal and all sorts of other tasty morsels. Yes, that has had the benefit of bringing people’s attention to something that was affecting our constituents across the country. Therefore, I do indeed draw on definitions, but only definitions, from the European convention on human rights—this is not a sudden Damascene conversion to such a document; it is simply that those definitions are in our law and it is useful to base any amendment to a Bill before the House on existing law. That leads me, as always, to thank the Clerks for their mastery of ensuring that amendments are within scope, because getting the new clause into scope, as my hon. Friend the Member for Weston-super-Mare (John Penrose) found with his excellent new clause, which I will come to, was not particularly easy. That is why, in affecting consumers but not businesses, it does not go as far as I would have liked.

This matter is of such fundamental importance. You may think, Mr Deputy Speaker, that I am not all that much in favour of the modern world and that I think it would be nicer if we could go round with the odd groat or perhaps a sovereign to pay our way, but sadly that age of specie has gone—you might even say that the age of specie had become specious, but it is in the past. Everybody now needs modern banking facilities. Cash is not used anything like as much as it was, and every transaction that people carry out needs a piece of plastic, a bank that it comes from and a telephone or some type of technology. When somebody is debanked, it is like the Outlawries Bill on which we only ever have a First Reading: they are effectively made an outlaw in their own land. They are without the normal law of the land and the ability to do ordinary things. That is why new clauses 1 to 4 are really important, and a protection for people.

To return again to Nigel Farage, the idea that someone should be debanked because of legal political opinions is outrageous. The hon. Member for Gordon teases me for mentioning Nigel Farage, but actually a separatist who wants to break up the nation has a political opinion that in other countries would be considered treason. Those in China who say, “Free Tibet—have an independent Tibet,” do not get a lot of quarter. So once we start saying that someone can be debanked for holding Nigel Farage’s views, what about being in favour of Scottish independence? Would that be a view that one bank might not like and might say that members of the SNP—a perfectly legal party—should not be banking with it? It affects every political opinion, and a political opinion may be fashionable today, but tomorrow it may not be. We always have to consider in legislation the protection of free speech against the interests of passing fashion, because we and Opposition Members may be affected by it in a slightly different or changed environment.

[Richard Thomson]

Are we not talking about slightly different things? There was a highly contested narrative around the circumstances the right hon. Gentleman describes, but my understanding is that the gentleman in question was not so much debanked as offered a lesser account and has subsequently found somewhere he can bank satisfactorily.

[Sir Jacob Rees-Mogg]

The hon. Gentleman is misinformed. Mr Farage was only offered any new bank account with NatWest rather than Coutts when the story became public. Prior to that, he had not been offered any banking facilities, nor had he been able to find another bank that would take him on. So the facts of the matter are that Coutts/NatWest debanked him because of the extraordinary internal set of communications, which have become public and led to the resignation—effectively the firing—of the chief executive of NatWest, partly for gossiping about his banking circumstances, but also for the behaviour that had led to his banking facilities being taken away for his political opinions. That is quite clear from the information that has emerged.

--- Later in debate ---

[Richard Thomson]

May I, too, add my thanks to the Bill Committee members and to all the Members who have contributed throughout the passage of the Bill? I also thank the Clerks for their wise guidance and assistance, and Sarah Callaghan, in the SNP’s research office, for the diligent work she has done on this.

I have said throughout that the amendments we sought to put forward were merely to fill the potholes that we saw in the Bill. It did not need a special fund from the Prime Minister to fill them; all it needed was for some action to be taken on greenwashing and drip pricing, and I am sure the Minister can understand the rest from what I have said. We think those issues still need addressing, but my concern is now about the impact that the Bill will or will not have on big tech and the freedom of the markets our consumers operate in. The success of the Bill will be measured not in the size of the majority that the Government could have had tonight, but in the impact it has on consumers and small businesses in the weeks, months and years ahead.

Question put and agreed to.

Bill accordingly read the Third time and passed.

Digital Markets, Competition and Consumers Bill

Richard Thomson Excerpts

Consideration of Lords amendments
Tuesday 30th April 2024 Commons Chamber

[John Penrose]

We will have to preserve our souls in patience for the Minister’s closing remarks. I will declare victory very shortly. It has been a helpful set of interventions, and I thank him for that.

My final point is not related to these Lords amendments, but to a commitment that the Minister made at the Dispatch Box on Report in response to an amendment on better regulation that I had tabled with the support of a great number of parliamentary colleagues. He made a commitment that a set of conclusions, matching a set of standards whose wording he and I had agreed in advance, would be in place before the Bill receives Royal Assent. Clearly we are getting close to that date—I hope very close—and I understand that a Government White Paper may be in the offing, but I am not sure whether that will arrive before Royal Assent. My point is intended not to delay Royal Assent, but to bring forward the White Paper or whatever document the Government may be thinking of.

Based on conversations I have had so far, I am also concerned that not all the commitments the Minister made from the Dispatch Box may be in that White Paper. I therefore urge him to make sure that between now and Royal Assent, he works assiduously with his fellow Ministers to make sure they have got the memo that should gone round after he made those commitments.

[Richard Thomson (Gordon) (SNP)]

Scottish National party Members continue to support this Bill, and we support each of the Lords amendments. Notwithstanding the rather dizzying pinball rattle of interventions that went on between the Minister, the shadow Minister and the hon. Member for Weston-super-Mare (John Penrose), I will be a bit of a traditionalist stick-in-the-mud and stick to the wording in the amendments and the Bill, no matter what references might be made subsequently to the ghosts of debates past in Hansard.

On Lords amendment 9 and “proportionate” versus “appropriate”, it might seem to people outside this Chamber that we are dancing on a pinhead, but such distinctions matter. It is important that decisions of the Competition and Markets Authority should be allowed to stand wherever they deserve to, but that means not allowing unnecessary wriggle room to creep in for entities with deep pockets to challenge decisions not on the basis of principle, but on the grounds of what those entities consider proportionate. We consider that replacing the word “proportionate” is appropriate in this case, and we support the Lords amendment on that basis.

Lords amendment 13 reinserts the word “indispensable”. As the shadow Minister said, that term is well understood in competition law, but it also happens to be proportionate and appropriate in this case. It is entirely possible to envisage anti-competitive behaviour that can bring about consumer benefit either as a direct or indirect consequence, but we are clear that any benefits that arise should be such that they cannot be done without or forgone and that the test should be set accordingly.

With Lords amendments 26, 28, 31 and 32, we have believed throughout the Bill’s passage that the judicial review level is the appropriate appeals standard, rather than a full merits review. That is why we support those Lords amendments.

Digital Markets, Competition and Consumers Bill

Richard Thomson Excerpts

Consideration of Lords message
Tuesday 21st May 2024 Commons Chamber

[Madam Deputy Speaker (Dame Eleanor Laing)]

I call the SNP spokesman.

[Richard Thomson (Gordon) (SNP)]

It is a pleasure to speak in this debate, much as I wish we were not here, because we would not need to be here if the Government had done the decent, sensible thing and accepted the Lords amendment.

We have heard stories in interventions and substantive contributions, and in past debates, about the effect of an under-regulated secondary market that leaves fans paying over the odds for tickets, and places experiences beyond the financial reach of families. There is also a high risk involved that tickets purchased that way will not even grant entry to the events, and I had hoped that by this stage the Government might have read the room, understood that, and decided to respond in a meaningful manner. Let us be in no doubt: the Government amendment does little other than add the Competition and Markets Authority to the list of bodies that are able to enforce the already existing and inadequate rules on secondary ticket sales. As just about all Opposition Members can see, even if Government Members cannot, the existing rules are not working as well as they are intended to work.

[Angus Brendan MacNeil]

My hon. Friend makes a good point about the powers given to the CMA, and I wonder whether the Government can increase the ability to finance and give capacity to the CMA to deal with this sort of stuff, or is this just something that has been passed on in paper?

[Richard Thomson]

Perhaps the Minister will be able to deal with that question when he responds to the debate. Certainly the measure might bring a bit more resource, but it will also spread the resource for the CMA that little bit more thinly. The fact that the rules are not working as effectively as they need to has been evidenced in previous debates, when we have heard of obscure charging practices, of pressure to pay with countdown timers, and of the exorbitant end prices that often result.

The Government amendment is fine as far as it goes. It might bring a little more resource to the problem and a more strategic capability when tackling rule-breakers. I also gave two cheers when the Minister announced the promise of an inquiry at the tail end of the previous debate, but the Government are still not taking those practical measures that could be taken today with amendment 104B to clean up the marketplace for secondary ticketing.

Amendment 104B would involve measures such as a requirement to provide proof of purchase or evidence of title for the tickets for sale, which would forbid resellers from selling more tickets than they would legally have been able to purchase from the primary market. It would ensure that the face value and end price paid are clearly visible, along with the name and trading address of those doing the secondary vending. Crucially, it would also allow secondary legislation to be introduced, which could take account of and bring in anything from the inquiry that the Minister has announced, and it would compel the Secretary of State to have concluded that work within nine months. Contrary to what the Minister says, I believe that the measures in Lords amendment 104B are proportionate and add clearly to the existing Bill.

Lord amendment 104B is a bit like Lords amendment 104 which came before it. Indeed, it is almost the holy grail of amendments—it is popular, it does not cost anything, and more to the point it would be effective and do the right things in the right way for the right reasons. I do not think I am speaking out of turn when I say that hardly any Government in these isles, whether Labour in Wales, the SNP in Scotland or the Conservatives at UK level, are so overwhelmed with public support and good will at this time that they can afford to turn down good ideas when they are presented to them on a plate. It is therefore baffling that the Government would seek once again to steer these practical and effective measures off the road and into the ditch.

I will conclude my remarks by remarking on the “Dear Colleague” letter that was sent from the Minister yesterday, in which he expressed a clear desire to get the Bill on to the statue book without delay. Not a single Member of the House looking at the Bill in its totality would want it to be delayed, but we want it to go forward into legislation in as strong a form as it can be. That, for me, clearly means going forward in a way that can tackle the egregious abuses of people’s trust, and the reasonable expectations they have when they participate in the secondary ticketing market. Accepting the Lords amendment would allow everyone to do that, and I hope the Government will take heed of the genuine strength of view that exists on this matter, not just within this House or the other place, but outside and among the population at large, and that they will allow the Bill to progress as amended accordingly.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

I rise to support Lords Amendment 104B, which seeks to safeguard fans from the fraudulent abuse that is rife in the secondary ticketing market. Like my hon. Friend the Member for Rhondda (Sir Chris Bryant), I am really disappointed that the Government have repeatedly refused to accept the amendments to the Bill tabled by Lord Moynihan. In fact, for many years before that, they have failed to act as advised by my hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson) and her colleagues on the all-party parliamentary group on ticket abuse, supported by FanFair Alliance.

The Lords amendment includes the minimum of protection that fans deserve. It would ensure that anyone reselling a ticket has to show evidence that they have bought the ticket in the first place. As we have been hearing, that is a big issue in the secondary market, where ticket touts often list tickets that they do not own. The Lords amendment also aims to stop touts from listing more tickets to an event than they can legally purchase from the primary market.

If the Minister looks at Viagogo’s listings for BBC Radio 1 upcoming Big Weekend, he will see that touts based in Germany are selling more than 10 times as many tickets as can legally be acquired. He has said that measures to do anything about that are unenforceable, but that should not be an excuse. We cannot be standing here in this House and saying that a law that we could pass is unenforceable—it is ridiculous.

Another important measure in the Lords amendment is provision for a review to be published within nine months of the Bill passing. That is an urgent issue, and the Government must be ambitious in acting to tackle it.

I point out again to the Minister that action to crack down on ticket touting has significant support from the music industry and fans. Regulating against exploitative secondary ticketing practices is part of the manifestos put forward by music industry bodies including Live music Industry Venues and Entertainment and UK Music.

Many promoters, artist managers, venues and musicians have been highly critical of the market as it currently operates and called on the Government for urgent action to tackle the problem, but it is not just a problem for the music industry; foremost, as we have heard, it is an issue for fans. It is now commonplace for fans to miss out on tickets to sporting and cultural events only to see those same tickets on sale on a secondary ticketing site for far more money than they can afford.

With about a third of UK ticket buyers in the lowest socioeconomic bands, those inflated prices are reinforcing inequalities. The price of a ticket can make a significant difference to social and cultural inclusion, in some cases enabling marginalised or disadvantaged groups the opportunity to access events.

It is important that many venues and artists now endeavour to widen access to tickets by through-ticket pricing to certain groups, but that approach is undermined when touts use software to restrict fans’ access to the primary market and then force them on to resale sites such as Viagogo, which charge prices at the top of what consumers can bear, as we have been hearing. For example—this is disgraceful—I have been told that touts will buy up discounted tickets intended for young people, for people in wheelchairs, for carers and for others, and sell them on at the going rate on the secondary market to increase their profit margins. That has a serious impact on those consumers, who are then refused entry at the door, as well as impacting on the venue or artists that had subsidised tickets, and on the people for whom the lower priced tickets had been intended and who can no longer afford to attend the show.

I have spoken about music so far, but touting also affects other live events such as sport. Most recently, we have seen Viagogo listing up to 100 tickets for the England versus Iceland friendly at Wembley on 7 June, despite the fact that listing football tickets is illegal on unauthorised platforms—including Viagogo’s platform—for reasons of the safety of fans. When The Guardian journalist Rob Davies highlighted the listings on social media, Viagogo took down the tickets straightaway. Resale platforms should not be waiting to be caught out before complying with the law, but that is what we are seeing.

Another example of a secondary resale site having to be pushed into acting by media coverage was a recent BBC “Watchdog” report that raised concerns that some customers have not been able to receive a refund from Viagogo after being sent invalid tickets. Beth from Salisbury told the programme that she had booked a trip to Singapore to see her husband’s favourite band Coldplay as a thank you to him for his unwavering support during her cancer treatment. The two tickets to the show were bought through Viagogo for £500, but when the tickets arrived, the piece of paper said

“this is not a valid ticket”.

When she tried to get a refund, she was refused, despite the fact that Viagogo has a guarantee, apparently. In fact, it only refunded Beth’s money for the faulty ticket after the BBC “Watchdog” report. Given the weight of evidence of market dysfunction, which we have heard here and in the other place, it is disappointing that the Minister insists that the Government are already doing enough. If that is the case, why not agree to the amendment and see what comes out in the review?