Jobs and Business

Sharon Hodgson Excerpts

Friday 10th May 2013 Commons Chamber

[Mr Umunna]

It is funny that the hon. Gentleman should bring that up, as I was just coming on to it.

Finally, on tax and other incentives for business, we have been arguing for months for a national insurance break for micro-businesses taking on extra workers. The full scale of the failure of the Government’s initial national insurance holiday scheme was laid out for all to see by the accountants UHY Hacker Young last week when they disclosed that the scheme, which the Chancellor said would benefit over 400,000 small businesses, reached a new low in December last year, attracting only 400 applications. I thus say to the hon. Gentleman that I really hope that the National Insurance Contributions Bill in this year’s Queen’s Speech, which introduces the employment allowance—no doubt there is more detail in the paper the hon. Gentleman has with him—will prove far more successful than the Government’s scheme to date. [Interruption.] I am asked whether I support it, but I have just said that I hope the scheme proves to be far more successful than the lamentable failure of the Government’s scheme to date.

Before I finish, I want to deal with the Government’s consumer rights Bill. As I said, empowering the consumer is an important part of ensuring healthy and efficient functioning markets. The Government have included a consumer rights Bill in the Queen’s Speech. We are told that it consolidates consumer rights legislation in one place, bringing together eight pieces of legislation and covering goods, services, digital content and unfair contract terms. I agree that consumers need more clarity on their rights, but from what we have seen so far, the Government’s proposals appear to fall short of the action that we have called for to help families, to ensure a fair deal on energy prices and to tackle high rail fares, for example.

I think that the Government’s changes in this area have been muddled, as we have seen this week. First, the Government were going to abolish Consumer Focus, but now we learn that they are going to keep it in a slightly watered down form, and it will now be called Consumer Futures. It seems that it will be doing a similar job, but who knows what landscape we will be left with.

As part of our policy review, which was led by consumer champion, Ed Mayo last year, we have been planning to bolster collective action and to empower consumers so that they can club together more easily to seek redress. As the consumer rights Bill makes progress, we will press Ministers for a strong, accessible collective redress mechanism—one that mirrors the Portuguese and Australian models, which remove the legal excesses. It will not be a US-style class action, where litigation is dominant. We will address the matter in more detail when the Bill begins its passage through the House.

So there we have it: after three wasted years, we have yet another wasted chance to bring change to this country—change that it desperately needs.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

I listened with interest to what my hon. Friend said about the consumer rights Bill, to which I hope to contribute. Does he agree that this might provide a fantastic opportunity to address the disgraceful practices of the secondary ticketing market, which has now become industrialised ticket touting? Does he agree that we have a great opportunity to put fans first?

[Mr Umunna]

I completely agree with my hon. Friend, who has done fantastic work in this area. We will scrutinise the Bill closely and if it does not contain provisions to address secondary ticketing, we will table amendments to bring about much-needed change on this issue, which my hon. Friend has championed for a long time.

Despite the difficult economic climate, I do not doubt for one moment our businesses’ ability to overcome the hurdles in front of us. I see dynamism and innovation as I go around the country meeting so many of our entrepreneurs, which I have found to be an inspiration. I wish only that we had a Government equal to the task of helping those entrepreneurs to go on and thrive. It is clear from the Queen’s Speech that this Government are out of steam, and that until we have a general election and the chance of a Labour Government, we shall not see the kind of government that I think our businesses want and need.

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[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

The hon. Member for Hendon (Dr Offord) has sat down a little earlier than I thought he would—and I was enjoying his speech so much!

My constituents were looking forward to Her Majesty’s Gracious Speech, as they have looked forward to every Budget and autumn statement since this coalition assumed office. They have been looking for a sign that Ministers had abandoned government by dogma and were prepared to prioritise targeted programmes to tackle the problems of unemployment and under-employment, particularly among young people, but there has been no such sign.

Youth unemployment in my constituency is currently 14.3% as against a national average of 7.2%. That is totally unacceptable. It is double the national average and will be blighting the lives of those young people, possible irrevocably. Why is it always the north-east that suffers when there is a Tory in the Prime Minister’s office? Do not our kids deserve as fair a chance as the kids in the shire counties? Are they always going to be at the bottom of the list of priorities for Tory and for Lib Dem Ministers, perhaps because their parents vote for Labour in droves? One nation Labour will not behave in such a way when we are in office. We will govern for the whole of the country and all young people regardless of how their parents vote.

My constituents have been looking for signs that this Government are on their side, rather than on the side of the super-rich, and for signs that they are going to tackle the big issues which have such a big impact on the quality of life of so many people—lack of affordable housing, rising fuel bills, poor economic performance, zero growth and a weak jobs market. They will have been sorely disappointed as there were no measures to tackle any of them, and there was nothing to arrest the increase in child poverty. Earlier this week, the Institute for Fiscal Studies projected that there would be more than 1 million extra children in poverty, wiping out the progress made by the last Labour Government, and surely saddling the country with huge costs over the lifetime of those children in lost opportunities and increased health and earnings inequality.

There were some important items of legislation in the Queen’s Speech, of course, but in the main my constituents got a list of vague ideas designed by Lynton Crosby to try to woo right-wing voters back into the Conservative fold—I include some Government Back Benchers in that group. There was very little positivity for the future, very little vision for a fairer and more modern Britain and very little to put food on the tables in Washington and Sunderland West.

Having said all that, I am hopeful about one Bill. The consumer rights Bill announced in Her Majesty’s Gracious Speech has, of course, been long anticipated; indeed, time is running out for it to be introduced. As Members will be aware, the European directive on which it is based needs to be implemented by December, so the Government will no doubt be in a rush to make significant progress on the Bill before the House rises for the summer.

During that rush, I hope to make my case for the Bill to include measures to reform the secondary ticketing market to ensure that fans get a fair deal. I was very encouraged to hear the shadow Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for Streatham (Mr Umunna), confirm in response to my intervention during his opening remarks that, if the Bill introduced by the Government contains no such measures, he will seek to make amendments to ensure that the wild west that the secondary ticketing market has become is reined in and regulated.

Members, and certainly Ministers from the Department for Culture, Media and Sport, will remember that I introduced a private Member’s Bill in the first Session of this Parliament that attempted to start this process. It would have established a scheme whereby those who are putting on a ticketed event—whether that is a gig, a west end show or even an art exhibition—could, if they wanted, protect those tickets from being resold by unauthorised individuals or companies for a mark-up of more than 10%. People would still be able to resell their tickets if they could no longer attend an event, but not for a huge profit.

Members might have noticed that I said, “even an art exhibition”. There is actually a roaring trade for such tickets. The Da Vinci exhibition at the National Gallery hit the headlines last summer because tickets were being snapped up by touts, much to the annoyance of the National Gallery, which felt absolutely powerless to do anything to prevent it. Anyone who wants to see the exhibition on David Bowie that is on at the Victoria and Albert museum will find themselves having to fork out at least £60 for a weekend ticket, which is more than four times the face value.

Back in 2010, I thought that my Bill was a sensible way to empower artists and event-holders to protect their fans from the rampant profiteering that we see on a regular basis. I believe that even more now. However, I also believe that the market needs to be much more transparent, as consumers should know who they are buying from and the provenance of the ticket. That is how any market should work.

There are a number of reasons why I am more convinced than ever that we need action. Since my Bill was talked out by the usual suspects on the Government Benches, we have had an excellent exposé by the “Dispatches” programme of how websites such as viagogo and Seatwave, through which the vast majority of secondary tickets are now sold, operate. Surprisingly enough, that differed greatly from the image that they used to portray of themselves as being fan-to-fan exchanges. They used to have that description on their websites, but since they have been exposed they have taken that down. We saw tickets being sold as if by fans when those companies were receiving allocations of tickets directly from promoters, or using banks of phones and batteries of credit cards registered to multiple addresses. We also saw how those companies court what we call “power sellers”—professional touts who manage to secure huge inventories of tickets to events by highly dubious means such as botnets, which Chris Stewart of Ticket Hut was recently found by the Daily Mirror to be using to secure vast swathes of One Direction tickets. I am sure that there are a number of One Direction fans in the Chamber today.

What makes me more concerned about the murkiness of this industry is that football tickets are now being sold through those websites, with clubs exploiting their right to authorise resale by saying that the likes of viagogo and StubHub can do that, even though it is actually random season ticket holders who are doing so. The resale of football tickets through other channels is understandably banned, due to safety concerns, and many people might think that the resale of football tickets is illegal, because there is supposed to be legislation. The purpose of the ban is to ensure that hooligans cannot get their hands on any tickets, and that fans of each team are segregated.

[Stephen Pound]

Every word I hear from my hon. Friend makes me all the more furious that her excellent Bill was talked out. Is she aware, as many of us are in the House, that Sir Alex Ferguson’s last match in charge of a certain team from up north is already attracting ticket prices of £3,000? Surely, under those circumstances, action must be taken.

[Mrs Hodgson]

I agree. There is obviously the unfairness, but there is also the fact that there was supposed to be legislation to protect football audiences from unscrupulous fans. Nothing stops any of those fans who might be able to get hold of that amount of money going along and ruining an amazing occasion such as the last match that Sir Alex will be in charge of. I certainly do not have any confidence in the websites that are now authorised by the clubs to sell tickets, because their ultimate aim is to make profits and I do not think that they are best placed to uphold the principles with regard to hooligans and segregation.

[Lyn Brown (West Ham) (Lab)]

What did my hon. Friend think of the Olympic ticketing system? That seemed to work quite well.

[Mrs Hodgson]

As my hon. Friend knows, we introduced legislation to protect the Olympic tickets. It was a proviso of the International Olympic Committee that the country that hosted the Olympics must protect the tickets, and it worked very well. Although the tickets were really hard to get hold of, the allocation was made fairly and they did not go to the highest bidder. Later I shall mention Operation Podium, the Met unit set up to police that legislation.

Despite the clear evidence in the “Dispatches” programme, and in a number of Penman and Sommerlad columns in the Daily Mirror since then, the sports Minister, the Minister of State, Department for Culture, Media and Sport, the right hon. Member for Faversham and Mid Kent (Hugh Robertson), has remained steadfast in his opposition to such a move. So I am now looking to the Secretary of State for Business, Innovation and Skills to look more favourably upon such measures in his forthcoming consumer rights Bill. The sports Minister has, however, always been at pains when we have debated this issue to say that his mind could be changed. Indeed, in a Westminster Hall debate on secondary ticketing secured by the hon. Member for Hove (Mike Weatherley), who also campaigns on the issue and who supported my private Member’s Bill—he was the only Conservative Member who did—the Minister said:

“Purely in my own opinion, the moment that the security services or the police say the activity is becoming a proxy for large-scale criminal activity, and that large amounts of money are being laundered through the system, the case for legislation will become much easier to make.”—[Official Report, 13 March 2012; Vol. 542, c. 65WH.]

Well, now the police have that evidence. Operation Podium, which Members may be aware was the Metropolitan police’s dedicated response to the serious and organised crime affecting the economy of the London Olympic and Paralympic Games in 2012, in a report entitled, “Ticket Crime: Problem Profile”, published in February to coincide with the unit’s abolition, set out the extent to which fans are being “ripped off” through dodgy practices. It also laid bare the involvement of organised criminal networks, which will always be involved where there are large sums of money to be made in a semi-legitimate way. As for large sums, the Met estimates that the “industry”, if we may call it that, is worth £1 billion a year—a not insubstantial sum of money.

[Lyn Brown]

So my hon. Friend is basically making the case that it would be harder to launder money from drugs, for instance, if we had better legislation on this issue.

[Mrs Hodgson]

That is exactly the point, and it is well made.

For the benefit of the House, I shall quote some highlights from Operation Podium’s report. It makes very interesting reading. It found that

“due to the surreptitious way that large numbers of ‘primary’ tickets are diverted straight onto the secondary ticket websites, members of the public have little choice but to try to source tickets on the secondary ticket market.”

It concluded that

“the lack of legislation outlawing the unauthorised resale of tickets and the absence of regulation of the primary and secondary ticketing market encourages unscrupulous practices, a lack of transparency and fraud.”

This is the Metropolitan police recommendation:

“Consideration must be given to introducing legislation to govern the unauthorised sale of event tickets. The lack of legislation in this area enables fraud and places the public at risk of economic crime.”

They went further still by saying:

“The primary and secondary ticket market require regulation to ensure transparency, allowing consumers to understand who they are buying from and affording them better protection from ticket crime.”

In short, the report sets out how this market is failing, and how it works in the interests of a handful of professional touts, middlemen and the criminal underworld, with dubious practices and tax arrangements. As an example, in the wake of the “Dispatches” documentary, it emerged that viagogo had transferred its formal head office for legal and tax purposes from the UK to Switzerland, despite the fact that all its staff are still working right here in London. One must ask why.

The Government could take action in the Bill to make the secondary market work in the interests of the consumer, which is to say the genuine fans and event-goers who want to enjoy and patronise the arts. In doing so they would also make the market work in the interests of those who are investing time, energy and resources, as well as talent, of course, who at present have to make the invidious choice between being leeched off by touts or getting into bed with them to get a little piece of the poacher’s pie.

This pie, as I said, is estimated by the Met to be worth in excess of £1 billion a year. No wonder there is such interest from the criminal world. We are talking about huge amounts of money to be made from doing very little. But this is not a victimless abuse. I get e-mails from dozens of victims every week. They are law-abiding regular citizens, adults and children, who have found themselves drawn into this murky world because they just want to see their idol play a gig or go to the theatre or an art exhibition. They end up feeling that they have no choice but to buy their tickets from the secondary market because that is the only place where the tickets are. Some realise that they are being fleeced and some do not, but all feel they have no choice.

These tickets end up changing hands for four, five or even more times their face value, as we heard—sometimes thousands of pounds. Who gets all that profit? The tout does, mainly, but as I mentioned, the situation is now much more complicated, as the Met made very clear in its excellent Operation Podium report.

Leaving aside the criminality, murkiness and lack of transparency, I am doing this for the fans—for the millions of music, sport, art, comedy and theatre fans out there who are routinely priced out of this wild west of a marketplace. It is not fair. I read all the e-mails I get. Some are heartbreaking, especially those from children. These are tickets to an experience, sometimes a once-in-a-lifetime experience. This cannot and should not be compared to the usual rules regarding supply and demand. As someone once said about football, “It’s not a matter of life and death; it’s more important than that.” I really believe it is. Other countries have chosen to regulate the market, most recently France under Sarkozy, who is hardly a left-winger. It did so because that is the right thing to do and we should do it as soon as possible.

The Bill is fundamentally a consumer protection Bill, so let us take the opportunity to protect live event consumers. Let us bring some transparency to a very murky market. Let us give those whose talent and investment create this demand in the first place greater control over the supply of their tickets. But most importantly, let us put fans first and let us take action on ticket touts now.

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[Julie Hilling]

That is the million dollar question. I have no idea why the Government will not take responsibility. They like to trot out the same old line that it is all the Labour party’s fault, but they must start to take responsibility.

We can all see the cost of the Government’s policies for the poorest in our communities, who are being hit not only in their pockets but by cuts in the services they depend on. We can see the consequences of cuts to in-work benefits, no pay rises, and rising inflation for those who used to feel comfortably off. We all know that there are only two ways to balance a budget: cut expenditure or increase income.

The Government’s cuts are harming not only individuals and their communities but the economy. A recent Financial Times study showed that cuts in social security payments would take £19 billion out of the economy. However, it is not just about social security spending. The low-paid spend more of their income, so less money in the community means more jobs lost, which means more people on benefits, and more jobs lost again—a downward spiral. The only way to reverse that spiral is to grow the economy by investing in properly paid jobs so that people are not dependent on social security but are instead paying into the coffers.

The Government do not have any real answers to the problems that we face. Unemployment in my constituency is up. One in 10 people in Greater Manchester skips meals so that family members can eat. Nationally, homelessness and rough sleeping are up by a third, and Shelter says that every 15 minutes another family is made homeless. The economy may be flatlining, but people’s incomes and spending are not. The Office for Budget Responsibility has said that in 2015 people will be worse off than they were in 2010. Wages are £1,700 lower than in May 2010.

Behind those figures are real people having a desperately hard time—people who are losing their homes, having to choose between heating and eating, and relying on food banks to feed themselves and their children. The people of Bolton West are struggling, and many are more than struggling—they are finding it hard to survive day to day. The Government blame them and are hell-bent on making the situation worse. They say that they have to cut the welfare budget but neglect to say that the majority of that budget is made up of pensions and in-work benefits. That does not fit the picture they are trying to portray of the skivers who are ruining the economy. They forget to say that jobseeker’s allowance accounts for less than 5% of the budget and that cutting benefit not only forces people to food banks but harms the economy. They forget to tell us that the private rented sector is far more costly than social housing. They will do nothing to introduce fair rents and nothing to curb the cost of private rented accommodation; they simply cap benefits in the hope that that might just bring down the rents. They introduce a bedroom tax that drives people to desperation.

The Government refuse to acknowledge that the work capability assessments that are conducted on ill and disabled people are fundamentally flawed. Even people who are too ill to leave their homes are being found fit for work. People who have lost their jobs through illness or disability are being told that they should get a job, but jobcentres will not sign them on for jobseeker’s allowance because they are too ill to work. Even though our staff are dealing with suicidal constituents on a daily basis, the Government accuse us of blowing the situation out of proportion.

[Mrs Hodgson]

My hon. Friend is making a fantastic, powerful and moving speech. Is she aware of other cases like my constituent Michael Moore, who was classed as fit for work and died less than 18 months later, or was that an isolated case?

[Julie Hilling]

If only that tragic case was an isolated one. There are many more people who have committed suicide after being told that they are fit for work or who have died between being told that they are fit for work and their appeal. That is a tragedy. The system is cruel and heartless, but the Government will not listen or say that they have to do something about it.

The Government blame migrants for unemployment but do nothing to enforce the national minimum wage, tackle the agencies that recruit only from abroad, or deal with the abuse of inflated accommodation charges for vastly overcrowded houses being taken out of people’s wages.

The Government have proposed a deregulation Bill. I shudder every time I hear those words. Of course we should get rid of unnecessary burdens on business, make compliance with legislation as simple as possible and listen to the concerns and proposals of businesses, but every time this Government have proposed changes, they have eroded the hard-fought-for rights of workers.