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National Consumer Week

Gareth R Thomas MP,  Parliamentary Under-Secretary of State for Trade and Consumer Affairs
Trading Standards Institute,  12 November 2007

Ladies and gentlemen. Bryan, Ron and John – thank you.

I am very pleased to be here today to launch National Consumer Week.

Let me start by thanking the office of Fair Trading and the Trading Standards Service for their continued efforts.

I have already seen first hand – through visits to Consumer Direct and Trading Standards departments in Brent and Harrow and in Westminster – much of the day-to-day work you are involved in. Safeguarding consumer rights and tackling the criminals who try and take advantage.

My constituents as consumers, like others up and down the UK, expect to be treated fairly, want their voices to be heard by business and want to be empowered so they are protected from rogue operators.

And in Government we remain committed to a robust and effective consumer and competition regime – one that is fair to consumers as well as business.

In particular we want

• Consumers with the right knowledge and information to shop confidently – be it in the high street or online. Be it in the UK or overseas.
• We want to see business treating consumers with respect, not unfairly pressurising or harassing them
• And we want enforcers who are equipped with tough powers to catch the rogues and con artists who flout the law.

In short, we will champion the interests of consumers, and in doing so we want to work with you – our partners – to ensure we have the best consumer regime in the world.

So by next April for example, all estate agents in the UK must belong to an approved ombudsman scheme – which will give consumers the right to challenge bad practice.

From next Autumn:

• We will be introducing new rights for consumers to protect them against high pressure doorstep sellers
• And we will be launching a new consumer advocacy body, bringing together the National Consumer Council, Energywatch and Postwatch.

To give consumers a more effective, stronger voice.

And we will, too, want to continue to challenge the rogues, those who deceive and those who are plain fraudulent.

For example, the last year has seen real breakthroughs in the work of our Scambusters initiative

Supported by nearly £2 million of Government funding, Trading Standards teams in the South-east, Midlands and the North have been working with police, local authorities and other agencies to crack down hard on some of the worst cross- border scams.

Only last month police took action against a huge rip-off driveway paving operation. Officers from three forces joined Trading Standards in raids on the gang, suspected of cold-calling on homes from Kent to Devon.

That and other examples show the teams are making a valuable contribution to protecting consumers against those individuals who have no intention of complying with the law. I congratulate them all on their successes so far.

But the battle to warn consumers about scams goes on. We’re working to raise awareness among the Muslim community of rogue tour operators ripping off travellers on the Hajj pilgrimage in Saudi Arabia.

Many in the Muslim community are not aware of the consumer rights they have when undertaking a Hajj pilgrimage; or do not know where to take their complaint.

So we’re working with colleagues across Government, and with LACORS, to find the best ways of getting these messages into the communities affected about what their rights are and who to complain to, so the law can be enforced.

It is, I think, a fundamental part of the job of Ministers to try to put in place proper protection for the most vulnerable members of society.

So I was particularly delighted that this autumn we announced the extension of our programme to tackle the loan sharks who bring misery to the most vulnerable members of society.

More than 165,000 households resort to using illegal lenders, mainly in deprived inner-city areas. Victims of loan sharks are not only charged astronomical interest rates but very often face violence, intimidation or blackmail if they fall behind with payments.

The original pilots in Glasgow and Birmingham resulted in a number of illegal money lenders receiving jail sentences.

Now with an extra almost £3million funding, regional trading standards organisations are setting up new teams to operate in every region of Britain.

So there has been much of late to celebrate in the fight to protect consumers. But for the future, the theme of your week – internet shopping and knowing your rights – is particularly timely.

The scale and growth of internet shopping is impressive. More than 20 million UK adults shopped online in 2005 with sales to households worth more than £21 billion.

With its convenience, increased choice of goods and bargain prices, more and more people now favour this form of shopping.

But there are downsides. The OFT’s recent market study has found many consumers lack awareness of their rights; a significant number don’t get proper redress when a sale goes wrong; and many consumers are put off by hidden charges or fears over security and privacy.

I welcome the OFT’s work to raise awareness of these issues.

As we approach the Christmas shopping season, we want consumers to take care when paying for goods and services online by using sites that are recommended. We want people to check where the trader is based and read the small print to ensure they know their rights if something does go wrong.

But we are also working hard to beef up protection in this area. Our work to implement the EU’s Unfair Commercial Practices Directive (UCPD) will see new Consumer Protection from Unfair Trading Regulations brought in by next April.

The new Regulations will help consumers by banning all types of unfair selling and marketing methods, which will help us to tackle conduct which although unfair is not currently unlawful.

The virtual nature of the internet makes it much easier for rogue traders to masquerade as individuals to deceive consumers into believing they do not have the same rights as they would have if they had bought from a business.
And there is a growing problem with traders posting bogus “consumer” reviews of their products on the internet to mislead potential purchasers.

These are two examples of practices which will be banned by the new Consumer Protection Regulations.

But we are not going to stop there. As internet markets develop, we need to make sure that we stay one step ahead in order to protect consumers. So I will be hosting a summit in January to consider consumer protection on the internet more broadly and further steps we might take to protect consumers.

Looking further into the future, the consumer agenda is only going to become more and more international.

The European Commission’s ongoing review of its own consumer protection legislation is a crucial opportunity to make sure we meet consumers’ needs in our growing Internet economy.

There is now a real opportunity to shape a long-term view of consumer protection in the UK which is fit for the 21st Century marketplace. New technologies and markets are driving new methods of trading, new consumer expectations and new communications channels.

These innovations, in turn, provide us with new challenges in delivering appropriate outcomes for consumers and for traders.

Along with our efforts to influence the Commission’s review, we have therefore commenced a major piece of work to review consumer law in the UK.

The current UK regulatory landscape for consumer protection is very complex – with more than 100 different pieces of legislation developed over several decades.

As a result the regulations are sometimes inconsistent and inflexible – for business as well as consumers.

The review of the UK’s consumer protection regime will report next spring.

It is:

• exploring ways of making enforcement more effective for consumers, less burdensome for low-risk, law abiding businesses and more targeted on higher-risk sectors and rogues;
• secondly, it’s investigating the options for improving consumer empowerment and redress and for providing information to consumers which will help them make the right choices and drive markets;
• and lastly, it is examining the scope for simplification of existing legislation, whether domestic or European in origin – while maintaining necessary protections;

We are interested in hearing your thoughts and experiences of the regime: which parts are working well and which would benefit from reform. Indeed, we look forward to working with many of you here in the room today as we take this review forward.

In conclusion,

Ladies and gentlemen, we want the UK to be among the best consumer regimes in the world.

To do that, we know we need a partnership with the people in this room – the regulators, the enforcers and the public bodies - and across Government.

Thank you for the work you already do. Together I have no doubt we can meet the challenges ahead and ensure our consumer regime stays genuinely among the best in the world.