Report stage in the Lords
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The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Truscott)Non-affiliated- Quote
- moved Amendment No. 1:
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Lord Williams of ElvelLabour- Quote
- My Lords, I am grateful to my noble friend for at least listening to the arguments that my noble friend Lord O’Neill and I put forward in Grand Committee. I am advised that the amendments go at least three-quarters of the way towards what the Welsh Consumer Council wanted. I am informed by my noble friend Lord O’Neill that the Scots take the same view. I have a slight problem with the proposed new subsection (3A) in Amendment No. 1. This allows the national council to impose restrictions or conditions on the exercise of a function by a territorial committee by virtue of subsection (3A). In other words, the national council can at any time more or less pull the plug. I should be grateful if my noble friend, when he winds up, will explore with us exactly what that means.
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Baroness Carnegy of LourConservative- Quote
- My Lords, I was not able to take part in the proceedings so far on the Bill but I have read them with interest. The Minister has virtually rewritten this part of the Bill. Why on earth did the Government pay so little attention to the requirements of devolution that they did not do a lot of this in the first place? It seems to be an extraordinary waste of parliamentary time. Nevertheless, it is excellent that he has listened to the arguments and I am sure that everyone will be grateful for it.
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Lord WhittyLabour- Quote
- My Lords, as my noble friend the Minister knows, in line with the noble Baroness’s comments, there is more joy in this House for one sinner that repenteth. I was worried initially about the clauses on devolution but the discussions the department has had with Welsh and Scottish interests in the mean time have led to a very good solution which largely reflects the practice that has been conducted, informally and without statutory basis, by the National Consumer Council and its Welsh and Scottish counterparts over the past few years. In that sense, the anxiety of my noble friend Lord Williams may be slightly exaggerated. In practice, this reflects how the Welsh council operates now and how an expanded body would operate in the future. It is a very successful conclusion of this part of the Bill.
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Lord O'Neill of ClackmannanLabour- Quote
- My Lords, the correspondence I have had with the Scottish Consumer Council representatives “as is” tends to suggest that they are very happy with the outcome of these discussions. It is to the Minister’s credit that he took on board the anxieties of a number of us and the consumer councils in Scotland and Wales. They will now be able to operate effectively with the devolved Assembly and Parliament. How successful these things are will depend on experience, but the constructive approach adopted by the Minister is certainly giving the proposal a fair wind. My colleagues in Scotland are sympathetic to his intentions and objectives.
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- Lord TruscottNon-affiliated
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- My Lords, I thank noble Lords for their contributions. I am grateful to my noble friends Lord Whitty and Lord O’Neill for their kind words and to my noble friend Lord Williams for his conditional kind words, saying that we have gone a long way to meeting the points he raised in Committee. New subsection (3A), which my noble friend Lord Williams mentioned, is about co-ordinating issues and consumer representation that transcend national boundaries. There is no attempt to rule from the centre, as it were. Individual councils will have the full role that is intended in the Bill. As my noble friend Lord Whitty said, the department has been in contact with the consumer councils in Scotland and Wales, and they have supported these amendments fully. To respond to the noble Baroness, Lady Carnegy, we have moved on these points, but then that just shows that Members of the Grand Committee were doing their job. They made their points; we took them on board and brought forward these amendments as a result. On Question, amendment agreed to.
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- Lord TruscottNon-affiliated
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- moved Amendments Nos. 2 and 3:
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Lord De MauleyConservative- Quote
- moved Amendment No. 4:
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Lord BorrieLabour- Quote
- My Lords, I question the usefulness and desirability of the amendment. Indeed, I am rather surprised that the Opposition have brought it forward again on Report in more or less the same form as it was in Grand Committee. When the amendment was moved in Grand Committee by the noble Baroness, Lady Wilcox, she said, as did the noble Lord, Lord De Mauley, today, that it was intended to ensure that sole traders and small businesses are considered consumers for the purposes of the National Consumer Council. However, even at a glance, it can be seen that the amendment is not confined to sole traders and small businesses; it is wide enough to cover the largest of corporations, whether they are ICI or Tesco, buying things for their own business. I am surprised that noble Lords on the Opposition Front Bench, which today includes the noble Baroness, Lady Wilcox, who is a distinguished former chairman of the NCC, consider that the National Consumer Council should spend any of its time looking after the interests of our major corporations, which are surely well capable of looking after themselves through their adequate legal staff and so on. I wonder whether their intention to assist small businesses and sole traders is helpfully improved by the broad wording of the amendment. Clause 2 defines “consumer” as, “a person who purchases, uses or receives, in Great Britain, goods or services”. We all know that in law a “person” includes bodies corporate or corporate persons so, whether a small business is a partnership or incorporated as a company, it is a consumer when it purchases goods. The disadvantage of the amendment is that including especially words to demonstrate that businesses are consumers as well would encourage the National Consumer Council to consider their needs in buying goods and services as at least equal to those of the man or woman in the street purchasing goods in all the manifold ways available to us. That is not an appropriate function for the NCC. Many small businesses, although they are far less able to help themselves than a major corporation, belong to trade associations. One very often hears them talking on the radio and elsewhere on the interests of small businesses, whereas the ordinary man or woman in the street does not have, as an ordinary consumer, any such trade association except for any voluntary bodies that they may join, such as Which?, the Consumers’ Association or the National Consumer Council. This is an unnecessary and undesirable amendment, and I hope that it is not pursued to a Division.
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Baroness Miller of Chilthorne DomerLiberal Democrat- Quote
- My Lords, I declare an interest as a sole trader and member of the Federation of Small Businesses. I am grateful to the noble Lord, Lord De Mauley, for raising this point, although we have not added our names to the amendment, for some of the reasons outlined by the noble Lord, Lord Borrie, such as reservations about the size of the business and so on. Between Committee and Report a problem I have had as a sole trader has arisen—quite fortuitously, in the light of this debate, as it has put into sharp focus the sort of problems that occur. Over a year ago I started my small business, and it took a year for the electricity supplier to resolve who was the electricity supplier, because although we had applied very clearly to a supplier, the bill had not been switched to our account. When we finally got a bill after 14 months, it was large enough to put a business under. The Federation of Small Businesses is very helpful in such situations in giving advice across the board, but how the NCC will work with such organisations is crucial. Very small businesses are as vulnerable as individual consumers. Very often, a sole person working in a business is pushed for time to sort out such thorny problems. The noble Lord has raised an important issue, and it would be useful if the Minister could explain how he envisages the provisions working for smaller businesses.
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- Lord TruscottNon-affiliated
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- My Lords, I am grateful to the noble Lord, Lord De Mauley, and the noble Baroness, Lady Wilcox, for affording us the opportunity to debate this important issue. I am also grateful to my noble friend Lord Borrie for his expert analysis. I shall refer later to some of the points raised by the noble Baroness, Lady Miller of Chilthorne Domer. I am mindful of the significant expertise of the noble Baroness, Lady Wilcox, in this field, as a former chair of the National Consumer Council, and I shall try to address the issues that she raised, to which the noble Lord, Lord De Mauley referred. The amendment affords me the opening to explain the scope of the role of the new council in representing consumers’ interests. There will be no inherent constraints on the consumers which the new council may represent. I believe that it is essential that the council should have the opportunity to prioritise its work according to consumer detriment, while taking into account the important functions which we have set out in the Bill, for example on vulnerable consumers. The council will need to consider carefully where it can best utilise its resources in aid of the consumer and how its expertise can be deployed in their best interests.
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- Lord De MauleyConservative
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- My Lords, I thank the Minister for his response. I particularly thank the noble Baroness, Lady Miller, for her support. She makes precisely the point that we are concerned about. I thank the noble Lord, Lord Borrie, for his intervention. Interestingly, he seemed to say, on the one hand, that “person” included bodies corporate, but on the other hand, that they should not have as much entitlement to the services of the NCC as individuals. I found that confusing. As he will be well aware—I specifically asked about this—we are trying to encourage the Government to clarify that, unlike in other legislation, sole traders and small businesses are covered. The amendment is not perfect. Defining small businesses is not straightforward. We shall take it away and consider it in the light of the Minister’s response, which was delivered at some speed. We need to absorb that and consider whether we want to bring the amendment back in some form at Third Reading. I beg leave to withdraw the amendment. Amendment, by leave, withdrawn. Clause 3 [“Designated consumers”]:
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- moved Amendment No. 5:
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- Lord TruscottNon-affiliated
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- My Lords, I am grateful to the noble Baroness, Lady Miller of Chilthorne Domer, and the noble Lord, Lord Razzall, for tabling the amendment and enabling us to discuss this issue once again. Clause 3 defines “designated consumers” as consumers of mains electricity and mains gas and postal services, and provides for the future addition of water consumers in England and Wales to that category of consumers. The clause also provides powers for the Secretary of State to remove classes of consumers from the “designated consumers” category. The amendment would require the Secretary of State to make an order designating water consumers as designated consumers from the beginning, although we have said that we will consult in 2008 on whether to extend the Bill’s provisions to water. The second effect of the amendment would appear to be that the Secretary of State would be obliged to remove some designated consumers from the list in subsection (1), but the amendment does not say in which way and when that duty must be exercised. It is difficult to discern the intention behind the effect of the amendment on subsection (2)(b), despite the points made by the noble Baroness. The powers of the Secretary of State under Clause 3 permit the possibility of incorporating the water sector in England and Wales in these new arrangements at some point in the future. We wish to retain that flexibility, although I accept that some noble Lords have expressed firm views that the water sector ought to be included from the beginning. The decision to consult in 2008 on whether to include water was taken following the public consultation. The circumstances under which consumers would cease to be designated depend entirely on the market. It would need to be clear that designation was no longer required, after consultation with the council, Scottish Ministers, Welsh Ministers and others.
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Baroness O'CathainConservative- Quote
- My Lords, what did the Minister mean by “depends on the market”? I do not understand that; perhaps I might do so if he repeated it.
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- Lord TruscottNon-affiliated
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- My Lords, the question was: under what circumstances would consumers cease to be designated? The response was that that would depend entirely on the market. It would need to be clear that designation was no longer required, and after consultation with the council, Scottish Ministers, Welsh Ministers and others my understanding is that particular groups of consumers are designated as such because of the incorporation of, for example, Energywatch and Postwatch. Were the situation to change, if other groups came in or left, the group of consumers designated by the Bill would, by its nature, change.
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- Baroness O'CathainConservative
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- My Lords, I remain completely dense about all of this. Does the use of “market” mean a group of designated consumers, or is it the marketplace?
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- Lord TruscottNon-affiliated
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- My Lords, I am referring to consumers not suffering particular problems. I will write to the noble Baroness, Lady O’Cathain, on the issue. If I may continue to clarify that point, the concept of “designated consumers” permits the new council to undertake specific functions in respect of consumers of regulated utilities covered by the Bill and to provide continuity from the current sectoral arrangements for representation.
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- My Lords, my amendment was merely a means of exploring the problem further. I am glad that I tabled it, because the issue needs to be addressed. I am not sure that I am happy with the clarity of the Minister’s reply, because the three sectors concerned here—energy, postal services and water—are among the most volatile issues for consumers. The situation, certainly regarding energy and water, is unlikely to get any calmer in the foreseeable future. There would be very great concerns about water. The Minister could perhaps bring back something more definite at Third Reading regarding the Government’s proposals for when the Secretary of State might remove the designation. If the Minister chose not to do that, I would flag it up for colleagues in another place to explore in much greater depth, because the Bill is asking people to give up their representative bodies on the basis that they will be better represented by this new overarching body, without knowing exactly what that means for designation. I beg leave to withdraw the amendment. Amendment, by leave, withdrawn. Clause 4 [Forward work programmes]:
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- Lord De MauleyConservative
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- moved Amendment No. 6:
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- Lord O'Neill of ClackmannanLabour
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- My Lords, I hope that the noble Lord does not wish to push this issue to a vote. I see the force of his arguments, but I disagree with them. The financial planning afforded by three years is sensible but, when we are dealing with consumer matters, long-term issues can easily be incorporated in an annual forecast of activities. Therefore, I do not think that only if you have a three-year plan will you be able to look beyond the horizon. Let us take two of the areas for which the National Consumer Council will be responsible under the Bill: energy and postal services. It would have been most unhelpful if, over the past two and half years, a consumer council for energy had not had to indicate what it wanted to do for the 12 months ahead, given that we had energy prices of such volatility and given the difficulties that confronted the regulator, the consumer and, indeed, Parliament. Where you have rapid change, as we have had of late in the energy markets, it would be foolhardy not to do that. People would ask, “Why should the consumer council be looking into this? After all, it wasn’t in the three-year plan”. This is not an area of disagreement. We assume that, when the Bill is enacted, one of the major responsibilities of the National Consumer Council will be the protection of the postal consumer at a time when the market is opening. We know from the 1990s, when gas and electricity markets were liberalised, that problems arose that we had not anticipated. If, in those days, the old consumer councils had said, “We’d like to look at that, but we’ve committed resource to other worthy causes”, there would have been a lack of flexibility. This is about the actions of the council and its freedom to operate. I think that, as the Bill stands, there is plenty of scope for longer-term planning within the documents and that the amendment would unduly tie the council’s hands. One thing that has not been taken account of and which we have to recognise is that, after the Bill is enacted, the National Consumer Council will, I imagine, be of far more interest to whatever committee is responsible for it in the House of Commons. As someone who chaired the Trade and Industry Committee for a number of years, I have to say that we perhaps did not pay as much attention to the National Consumer Council as we might have done, although we paid plenty of attention to Energywatch and Postwatch. It would be of great assistance to our colleagues elsewhere—where a Select Committee looks at this area of operation, affording a degree of parliamentary accountability—to be able to meet the council annually to discuss the work programme. That would allow the council to accommodate the views of the other House. I think that, although the amendment is well intentioned, it is fundamentally flawed, and therefore I hope that the noble Lord will not push it to a vote. I am in favour of three-year financing but I am not necessarily in favour of over-prescriptive three-year plans, which could well be inflexible.
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- Baroness O'CathainConservative
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- My Lords, I support the noble Lord, Lord O’Neill of Clackmannan, on this but not because I think that my noble friend is wrong. The turgid language in the Bill is not clear. I think—I should like the Minister to confirm or deny this—that what is envisaged is a three, four or five-year plan and, within that, a financial report on where the council expects to be each year. It will say at the end of each year how it is moving towards ensuring that the plan ultimately works out. As the noble Lord, Lord O’Neill, pointed out, things can change drastically in a market. If the council cannot react because the sums are not there, surely, under the terms of best business practice, it should say that the three-year plan has been put off course due to whatever reason and that therefore, for this year, it needs to do this and, for next year, it needs to do that. The wording in the Bill makes the reporting process appear highly complicated. I hope that my noble friend does not feel that I have taken his amendment in the wrong way, but I think that the Bill is probably set out as it is—I hope that the Minister will confirm this—to ensure that a big hole does not appear in year one of a three-year plan without anyone knowing about it and without it being addressed until the three-year plan is reported on. I think that the provision is probably common sense.
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- Lord WhittyLabour
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- My Lords, I largely agree with my noble friend Lord O’Neill and the noble Baroness, Lady O’Cathain, but there is another dimension to this. I do not think that the new NCC, any more than its three predecessor organisations, would have any difficulty in preparing annual work plans. Those organisations do them now and they have a corporate plan along the lines set out just now by the noble Baroness. So I do not think that planning is the issue, but the finances could be. In particular, we have to bear in mind that this is not simply a question of a grant in aid from the DTI in the normal sense of general taxation, but of levies on designated consumers, which a large part of Clause 4 deals with. It is important not only that the new NCC knows what it has more than a year ahead, barring accidents, but also that the regulated industries know what they are expected to pay for those three years ahead. So it is sensible to deal with the finances on a three-year basis from that point of view, as well as from the point of view of general security of outlook. But, so far as concerns the planning, the wording of the Bill is perfectly okay.
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- Lord TruscottNon-affiliated
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- My Lords, I am grateful for the contributions from noble Lords. With regard to annual reports and forward work programmes, the idea is that the plan might be done for three years but it is a rolling programme. I think that that meets the point referred to by the noble Baroness, Lady O’Cathain. The amendment would require the new council to publish a forward work programme only once every three years. We believe that the publication of an annual forward work programme strikes a good balance with the requirement to prepare an annual report in line with financial years, as I mentioned. That is the basis of the provisions as drafted. This requirement replicates the current requirement on both Energywatch and Postwatch to produce a forward work programme annually. It is also consistent with the requirement to produce an annual forward work programme on the sectoral regulators, Ofgem and Postcomm, respectively. The publication of an annual forward work programme, on which the council must consult, ensures that the proposed activities of the council are transparent and that it can be held to account for those activities. That is particularly important given that some of the new council’s funding will come from industry. Additionally, the consultation allows it to obtain the views of key stakeholders in determining its priorities and the activities it undertakes to achieve them. I recognise that an organisation has to spend time and effort on preparing a forward work programme, but it is time and effort well spent. The forward work programme is the means by which the new council can set out a programme for consumer advocacy, set out its aims and priorities, and—because this is also important—set out its funding requirement. The Bill requires the forward work programme to cover the year ahead, but in many cases organisations are understandably keen to set out a programme covering a longer period, perhaps three or more years ahead. That enables the organisation to take a longer-term view, and by updating and renewing that vision each year, new and urgent priorities can be taken into account. Those points were made by my noble friends Lord Whitty and Lord O’Neill of Clackmannan. The forward work programme is in many ways the showcase for an organisation. It is a statement of intent, certainly, but, more than that, it is a demonstration of ambition to make a difference and a statement of willingness to be held accountable for that ambition.
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- Lord De MauleyConservative
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- My Lords, I thank the Minister, my noble friend Lady O’Cathain and the noble Lords, Lord O’Neill of Clackmannan and Lord Whitty, for their contributions. I am pleased that we have had the opportunity of this debate; it has been useful and flushed out some helpful information, especially on budgeting. For the moment I beg leave to withdraw the amendment. Amendment, by leave, withdrawn. Clause 5 [General provision about functions]:
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The Deputy Speaker (Lord Boston of Faversham)Crossbench- Quote
- My Lords, if Amendment No. 7 is agreed to, I cannot call Amendment No. 8.
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- Lord TruscottNon-affiliated
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- moved Amendment No. 7:
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- My Lords, I am grateful to the Government for moving somewhat on my Amendment No. 8. We have tabled an amendment of our own to highlight that the Government could move further. I doubt that the NCC feels that the government amendment gives enough emphasis to the extreme importance of the sustainability duties.
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Baroness ByfordConservative- Quote
- My Lords, I apologise that I was not able to be present on the second day of Committee stage. I hoped that we would reach my amendment, Amendment No. 100, on the first day, but that was not possible, and on the second day I was speaking at a conference in Nottingham. The noble Baroness, Lady Miller, rightly raised the issue of sustainability. As the Minister knows, Natural England was recently set up. For me, there is a question about where the responsibilities will lie. The new National Consumer Council will deal with complaints, but how much additional responsibility might it have for looking at sustainability? Will it make any judgments on sustainability, or will it look to Natural England to develop those policies and then react? While the NCC is being set up now, Natural England was launched only last October, so it is still in the early stages of its remit. On a later amendment I shall take up, in particular, the position of the Commission for Rural Communities and how it has not responded on behalf of post offices. Where does responsibility for sustainability lie? What interplay will there be between the organisations? Will one body deal just with complaints while the other deals with issues on a daily basis and looks at long-term sustainability?
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- Lord TruscottNon-affiliated
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- My Lords, the noble Baroness, Lady Miller of Chilthorne Domer, when speaking to the two amendments, asked what was the Government’s intention. Amendment No. 7, in my name, would ensure that the council exercised its functions, including the core functions in Clauses 7 to 9, in a manner that it considers is best calculated to contribute to the achievement of sustainable development. We think that our amendment strengthens the clause. The term “functions” is used, as it is consistent with the drafting in the rest of the Bill and covers powers and duties. The noble Baroness, Lady Byford, asked about the functions of the NCC. The council is subject to challenge if its functions are not carried out. My advice is that the council is also accountable through its annual report. I will write to the noble Baroness to clarify the point further. On Question, amendment, agreed to. [Amendment No. 8 not moved.] Clause 6 [Annual report]:
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- Lord De MauleyConservative
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- moved Amendment No. 9:
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- Lord TruscottNon-affiliated
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- My Lords, Amendment No. 9 would add to the obligations on the council in respect of the annual report by requiring it to include details of the most frequent complaints from consumers about post and energy for the year. It would also require the new NCC to include in the report any recommendations to regulated energy and post companies to change their practices. I certainly agree with the objective of the amendment. I share the ambition of the noble Baroness, Lady Wilcox, and the noble Lord, Lord De Mauley, that the council should be vigilant and active in the pursuit of opportunities to increase the transparency of the relevant markets by drawing attention to the sort of problems encountered by consumers. I am also very supportive of the ambition that the council should be a positive force for change and should be able to make recommendations to companies that would improve their performance to the benefit of consumers—that is also a clear benefit to the companies. The noble Baroness, Lady Wilcox, has previously made the powerful and compelling observation that complaints are important to companies because they help them to improve their performance and develop their businesses. I support that view wholeheartedly. Clause 9 provides the council with a general information function, which allows it to facilitate information provision to consumers, and Clause 44 obligates the council to publish information on the levels of compliance by an energy or postal services company with any complaint-handling standards set by a regulator. I hope that there is general agreement that the new statutory functions conferred by the Bill will provide the council with every opportunity to pursue the objectives set out in the amendment. As I said, I endorse the objectives of the amendment. However, although the council may very well include such information in its annual report if it considers that appropriate, it should not be obliged to do so, because that might not be the most appropriate way to provide consumers with information on complaints or on its recommendations to regulated post and energy companies on their practices. I hope that noble Lords will agree that, on balance, we should leave it to the council to decide how best to bring such information to the attention of consumers.
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- Lord De MauleyConservative
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- My Lords, I thank the Minister for his response and his supportive words agreeing with the objective of the amendment. I am not entirely sure that I agree with him but, having every confidence in the noble Lord, Lord Whitty, I beg leave to withdraw the amendment. Amendment, by leave, withdrawn. Clause 7 [The representative function]:
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- moved Amendment No. 10:
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- Lord TruscottNon-affiliated
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- My Lords, I understand clearly the point made by the noble Baroness, Lady Miller of Chilthorne Domer, that the council should be required to fulfil its functions as provided by the Bill. There is no real difference between us on that point, but the amendment would remove the council’s discretion in exercising its key functions. The council would be required to make representations to government and others, to undertake research, to facilitate the provision of information and advice to consumers, and to use its general powers of investigation. The council already has the flexibility to do all or any of these things, but it is not possible under the Bill to require it to do any particular thing without defining precisely what must be done and when. That is why the clause is drafted as it is. I hope that noble Lords will acknowledge that the Bill’s key purpose is to provide better and even more effective consumer representation to create a new body with important functions that go beyond those undertaken by the current National Consumer Council. The question is not whether the functions of the new council should be outlined in the Bill, or even whether the council should be sure to undertake the powers and duties represented by these functions; rather, it is a question of whether we should attempt to require the council to undertake all the functions at the same time in perpetuity, or whether we should set out the main functions of the council and leave it to determine how and when these functions should be exercised, according to the priority need and in accordance with its forward work programme. That is the position that the Government have taken. The council will need to consult on its forward work programme, which will provide all interested parties with the opportunity to submit ideas for action and views on how the council should undertake its functions for the period ahead. In its annual report, the council will need to report on progress on any projects described in that forward work programme, which is a good example of transparency.
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- My Lords, I thank the Minister for his reply. I suppose we will see whether this works only when the council in its new guise comes into being. This will be an interesting debate for the other place too. In the mean time, I beg leave to withdraw the amendment. Amendment, by leave, withdrawn. Clause 8 [The research function]: [Amendment No. 11 not moved.] Clause 9 [The information function]: [Amendment No. 12 not moved.] Clause 10 [General powers of investigation]: [Amendment No. 13 not moved.] Clause 11 [Investigation of complaints made by vulnerable designated consumers]:
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- moved Amendment No. 14:
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- Lord TruscottNon-affiliated
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- My Lords, Amendment No. 14 would extend the category of vulnerable consumers who can be aided by the council in the investigation of their complaints to “otherwise disadvantaged consumers”. I am grateful to the noble Baroness, Lady Miller of Chilthorne Domer, for raising this issue. Again, I do not think that there is any real difference between us on the question of who should be aided by the council in the investigation of their complaints. It is important that those who are most in need of assistance should be able to turn to the council for support and guidance. For that reason we have deliberately not sought to categorise those who constitute vulnerable consumers in the Bill. Our understanding of what makes for vulnerability develops and changes over time and we should be careful not to preclude any particular group of consumers from the possibility of assistance now or in the future. The Bill leaves it to the council to consider who should be regarded as vulnerable. Clause 11(2) states that, “a person is ‘vulnerable’ if the Council is satisfied that it is not reasonable to expect that person to pursue the complaint on that person’s own behalf”. The addition of the words “otherwise disadvantaged” does not add materially to the consideration. I hope that noble Lords will agree that this is the best way forward to meet possible future needs. Amendments Nos. 15 and 16 would require the council to investigate complaints by vulnerable designated consumers and to provide advice or to make representations on behalf of the consumer. I would suggest to noble Lords that the interests of the most vulnerable consumers will be best served by permitting the council to exercise discretion as to which complaints by consumers need to be supported and, where the council sees a need to provide support, which means of support would be best in the circumstances. The council should be able to use its judgment to define the groups of consumers who need help and to develop and refine that view to meet new or emerging circumstances. The council should have the discretion to decide how best to provide support for vulnerable consumers. It is important that the council should be able to determine how and when its important functions in respect of vulnerable consumers should be exercised according to the need and best use of its resources.
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- My Lords, I thank the Minister for his reply. I hope that the council will have a definition of those people it regards as vulnerable and will keep a very careful record both of those it has chosen to treat as vulnerable and those it has not chosen; it should then review both categories from time to time. I beg leave to withdraw the amendment. Amendment, by leave, withdrawn. [Amendments Nos. 15 and 16 not moved.] Clause 12 [Investigation of complaints relating to disconnection of gas or electricity]:
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- Lord TruscottNon-affiliated
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- moved Amendment No. 17:
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- My Lords, I thank the Minister for tabling these amendments, which meet many of our concerns in this area.
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- Lord O'Neill of ClackmannanLabour
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- My Lords, I join the noble Baroness in thanking my noble friend. I agree that the Government have co-operated on this issue. A number of organisations had approached noble Lords and I think they will take considerable consolation from the comprehensive character of the amendments that have been tabled in so far as they have met almost all of the concerns we expressed. I hope, therefore, that this important gesture, which may be more than a gesture, will go a long way to speeding the passage of the legislation.
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- Lord WhittyLabour
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- My Lords, I support the amendments. They make it clear that all issues concerning cut-off of supply, whether through a threat of disconnection or a failure somewhere else in the system, will be treated in this way. I simply make the point that I might have made on the previous group of amendments that these are the kind of complaints that would fall to the new National Consumer Council. I know that Energywatch takes the view that there is a wider set of priority complaints over and above those dealing with disconnection or failure of supply. At some point it will need to be made clear what boundaries will be considered by the National Consumer Council, by the normal information function of Consumer Direct or by the companies themselves in the first instance, and, if they fail, by the ombudsman system. It would be helpful if such clarity were placed on the Postwatch side of the equation so that the new structures and consumers can be clear where each form of complaint will fall. On Question, amendment agreed to.
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- Lord TruscottNon-affiliated
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- moved Amendments Nos. 18 to 24:
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Baroness WilcoxConservative- Quote
- moved Amendment No. 25:
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- Lord BorrieLabour
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- My Lords, because the amendment obviously seeks transparency, one feels very much in favour of it in principle. However, one should put the amendment into context. The National Consumer Council is required by other provisions in the Bill to publish its annual reports and its forward work programmes. The noble Baroness did not refer to Clause 16, which immediately precedes the clause with which we are now dealing, under which the council may prepare a report on any matter within its function and may publish the report. Some of the noble Baroness’s remarks would be applicable to Clause 16 because it provides that the National Consumer Council may publish reports of its own volition on matters it has itself chosen to consider. The logic of her argument suggests that if that report is of interest to consumers nationally it ought to be published. Leaving that aside, the noble Baroness has alerted us to Clause 17, under which the NCC is required to report on “any matter” that the Secretary of State specifies, and the Secretary of State may publish any report under that clause. The noble Baroness seeks to have the word “may” altered to “must”. Surely the NCC itself is free to publish a report on any matter it considers, whether it considers it of its own volition or at the request of the Secretary of State. Perhaps I am making a legalistic point to the Minister. I hope I am right about it and that the power of the council to publish any report under Clause 16 is not confined to that clause but that the council could publish a report as it wishes if that has been requested by the Secretary of State under Clause 17. I hope I am correct that the NCC is entitled to publish any report on anything it studies, whether at the request of the Secretary of State or not. The amendment proposed by the noble Baroness would be unduly burdensome by requiring the Government, at the taxpayer’s expense, to publish a report that neither the Government nor the National Consumer Council thought was of sufficient interest to justify publication. There must be some situations where a report is not worthy of publication simply because the work that has been done demonstrates that there is no problem where previously it was thought that there was. I fear that the amendment might inhibit the use by the Government of the power to seek the help of the NCC on matters relating to consumer interests. Surely the last thing we want is for the Government to feel inhibited or that they had better not risk asking the NCC for a report because of some compulsory obligation to publish that report in any circumstances and at whatever cost. I doubt the value of this amendment.
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- Lord TruscottNon-affiliated
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- My Lords, Amendment No. 25 relates to Clause 17 and to the actions that fall to the Secretary of State in this respect. I was grateful for the opportunity to debate this amendment in Committee. From that debate, it is clear that the intention behind the amendment is essentially the need for transparency in the Government’s dealings with the new council and the importance of the new council maintaining its independence. I confirm our wholehearted support for those intentions. As I explained in Committee, Clause 17 gives the Secretary of State the power to require the council to prepare and submit reports on any matter, permitting the Secretary of State to call on the expertise of the council to prepare and submit a report on issues that are judged important enough to the consumer interest to warrant further attention. Such a report would be for the purpose of reaching a decision on what further action, if any, was needed on the issue. We envisage that such a need could arise where the issues in question have not been identified in the council’s consultation on its forward work programme. The amendment would place a duty on the Secretary of State to publish all the reports submitted by the council under this clause irrespective of whether or not they are of wider interest or relevance, a point rightly made by my noble friend Lord Borrie. Having requested a report from the council, the Secretary of State would take into account any recommendations made on how best to progress the particular issue and would work closely with the council and others in coming to decisions about what would be appropriate in each circumstance. The current drafting allows for the discretion needed for that to happen. On the issue of the independence of the new council, particularly in response to my noble friend Lord Borrie, I confirm that Clause 16 enables the council to prepare and publish reports on any matter within the scope of its functions, while Clause 18(2) enables it to publish advice and information about consumer issues if it thinks publication will promote the interests of consumers. Those powers allow the council to take separate action in the interests of the consumer, or indeed in the interests of transparency, should it consider that appropriate. While I am sympathetic to the amendment, I believe we meet all the substantive points raised.
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- Baroness WilcoxConservative
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- My Lords, perhaps I may ask the noble Lord, Lord Borrie, whether the Minister has answered his question. I listened to him carefully. He said that the council can do what it likes under Clauses 16 and 18, but I did not hear him mention Clause 17.
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- Baroness WilcoxConservative
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- My Lords, I am told that because we are on Report, I may be breaking a rule. In that case I shall use the record instead. I was chilled by the words of the noble Lord, Lord Borrie. I thought, “What am I listening to? I’m listening to the National Consumer Council being changed from the body it is: brave and strong and able to publish its reports as it has done all these 25 to 30 years, not hindered by the Government in any way, fully funded by government but free to choose its work and to report as it wished”. Then I heard it said that the Secretary of State and the NCC will between them decide when things are published. All of this shows how important the amendment is. We should use the word “must”. The National Consumer Council is being tied up in these words. I worry when I hear “appropriate”, “discretion”, “drafting”. I worry that the National Consumer Council is being subsumed by a great, big body on which lies the Secretary of State’s hand, stopping it doing what it wishes to do. The provision does not sound clear or transparent. It does not sound like what we want the National Consumer Council to be. I am sure that the Minister has thought carefully and been well advised by his civil servants on how he should respond to me at this stage. I do not wish to divide the House on this point but I am disappointed by the answers. I was particularly disappointed by the reaction of the noble Lord, Lord Borrie. I beg leave to withdraw the amendment.
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- Lord BorrieLabour
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- My Lords—
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- Lord TruscottNon-affiliated
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- moved Amendment No. 26:
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- Lord TruscottNon-affiliated
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- moved Amendment No. 27:
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- Lord TruscottNon-affiliated
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- moved Amendments Nos. 28 to 39:
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Lord RazzallLiberal Democrat- Quote
- moved Amendment No. 40:
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- Baroness ByfordConservative
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- My Lords, I am very grateful to the noble Lord, Lord Razzall, for tabling this amendment. I again apologise to your Lordships’ House that I was not able to speak to it at an earlier stage as I was speaking at a conference in Nottingham. The noble Lord, Lord Whitty, will well know that for six years after 2000, when he was a Minister responsible for rural matters, I expressed my concerns about the future of post offices. I share the concerns that have been expressed on that issue. Part of the Bill is concerned with redress. Consumers want things to go right. Today, through no fault of the railway company concerned, I had the most horrendous journey getting here. A fire on a freight train outside Berwick totally blocked the line and it will be blocked for 24 hours due to the nature of the cargo on that train. I should say in fairness to the railway company that it was very good and made arrangements for some passengers to be transported via the west coast line. In that context it is important that we do not water down the Bill’s new provisions. I am particularly concerned about the part that concerns the postal services. I have made various rail journeys back and forth to Scotland. I had a difficult journey going up on Sunday as I was delayed three times, which was the railway company’s fault. However, the second occasion on which I experienced difficulty was certainly not its fault. The noble Lord, Lord Razzall, made various points on post offices, but I want to comment on the situation from a slightly broader perspective. As the practice on Report is to examine Ministers’ responses, I want to highlight the Minister’s response and to explore whether we are happy with it and therefore confident about where it will take us. As the Minister indicated clearly in Grand Committee: “Postal services consumers will also benefit from the introduction of redress schemes”. But we want to ensure that we enhance, and certainly do not detract from, the service that is offered by the new consumer council. The noble Lord, Lord Razzall, touched on the number of post offices that are likely to close. I share his concern. The Minister also stated in Grand Committee that, “99 per cent of the population will be within three miles of an outlet”.—[Official Report, 9/1/07; col. GC 60.]; that is, a post office outlet. However, in order to achieve that percentage, are not some of the most rural and remote post office outlets more likely to be closed in the future cuts so that the Government can achieve their target of having 99 per cent of people living within three miles of an outlet? Having travelled down through the country today, I am aware that some very remote areas will be in great jeopardy of losing their outlets. Will the Minister clarify the response that he gave in Committee as I do not think that he responded to that point? My next point was raised by colleagues. How will the Government ensure that the most vulnerable people in the remotest areas who have the greatest difficulty accessing these outlets will continue to be able to do so? I take up the point made about the squeeze on the Post Office bank card, which, as we have heard, has been overturned temporarily, but who will fight that corner in the longer term? I understand that the National Consumer Council will deal only with complaints; it will not set strategy. Perhaps the Minister can answer my earlier question in that regard. I refer him to the setting up of the Commission for Rural Communities. When that announcement was made I assumed that the Commission for Rural Communities would be the watchdog that would ensure that the rural voice and people’s concerns about the closure of post offices were heard. I was desperately disappointed that that was not heard in the national press. I am trying to get the Minister to respond to some of the comments he made in Committee. I ask him to clarify whether the council is going to deal just with an individual complaint or whether it will be able to look over the longer term at the repercussions of government decisions and the Royal Mail’s decisions on squeezing post offices. Having read carefully through the Committee stage, I find that not at all clear. I seek clarification from the Minister on those points which were debated in Committee but not clarified to my satisfaction. I am sorry that I was not here to raise the matter at the time.
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- Lord WhittyLabour
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- My Lords, I have some sympathy with the concerns expressed by the noble Lord, Lord Razzall, and the noble Baroness, Lady Byford, but I draw exactly the opposite conclusion on what should appear in the Bill. It seems to me that the problems of the Post Office have not been resolved by dealing with them in isolation from everything else that happens to rural areas. The whole rationale of the Bill is to create a trans-sectoral organisation which is able to bring expertise from other markets into markets such as the post office and the energy market, and to use the expertise in those markets to create more generic solutions to consumer problems. The longer you delay the establishment of those arrangements—and we are already putting water back until after the initial establishment of the arrangements—the longer it will take for that new organisation, the new consumer council, to achieve that level of strength and influence in general decision-making. On rural post offices, the noble Baroness, Lady Byford, and I have been very much concerned with services for rural areas. So has the noble Baroness, Lady Miller, who is just about to contribute to the debate. Post offices have been dealt with in a silo, entirely separately from the concerns of Defra and of the rural community more widely. Post offices are but one of the losses of services, both public and private, in rural areas. The losses have taken place partly as a result of market changes and demography and partly as a result of government decisions over recent years. It is much better that the issue is placed in that wider context, with an influential body that can influence government policy in a wide range of areas, rather than in the narrow area of departmental Post Office sponsorship by the DTI. That is what I see the new National Consumer Council doing. In response to the noble Baroness, Lady Byford, I say that the new National Consumer Council is primarily about strategy and issues of broad concern to consumers and not so much about individual complaints. In this wider context, the strategy on the Post Office network can best be dealt with by a larger, more all-embracing body. If we put back the Post Office consideration until 2010, as is suggested by the amendment, we will fall short of achieving the Bill’s objectives in a relatively short timetable. On the immediate issue of the current review of rural post offices, Postwatch is already setting up the way in which that will be conducted. It needs to get expertise from the National Consumer Council and the Commission for Rural Communities to broaden the base of that review. It can go on; it will have started by the time the new organisation reaches its vesting date, and it will continue thereafter. It is a ring-fenced process that is dealt with somewhat separately from the rest of Postwatch’s activities. Therefore, it will not be jeopardised by creating the new organisation. Clause 15 specifically requires the new council to conduct an assessment of the network of rural post offices, in the same way as Postwatch currently has this obligation. That responsibility is preserved. The influence on future post offices will be stronger, and the context in which such rural services are delivered will be broadened in a way that, as a whole, ought to benefit the rural consumer and not simply be seen in one dimension depending on the Government’s attitude to the Post Office in general. Rural consumers and indeed urban consumers who have lost their post offices in recent years will be better protected under this system. The sooner we introduce it, the better it will be.
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- Baroness Miller of Chilthorne DomerLiberal Democrat
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- My Lords, I support the amendment tabled by my noble friend Razzall. It does not state that the merger shall never take place; it accepts that, in time, that may be the best thing, and the Government have put a strong case for it. I understand the argument of the noble Lord, Lord Whitty, that that should happen now. Without in any way doubting his competence to manage the whole process, it is over-optimistic of the Government to expect that to happen at a time of enormous upset in the post office service and at a time when a consultation on the closure programme is under way. Notwithstanding the fact that the noble Lord, Lord Whitty, says that that process is ring-fenced, however much that is the case, you cannot stop disheartened staff leaving because they do not see a future for them within a new organisation. You cannot stop the expertise leaking out. All we are suggesting is a delay until 2010 and that Parliament will have another look at the matter. The noble Baroness, Lady Byford, who spoke on this issue at Second Reading—I fully understand why she could not be present in Committee—was quite right to say that the Commission for Rural Communities had been pretty silent on this. As she will know, I opposed the setting up of that quango, which can be no more than a voice. However, it is supposed to have direct access to the Prime Minister through its rural advocate and I wonder what he has been saying recently on this issue to the Prime Minister and if it has had any effect at all. The amendment will provide a chance for the Post Office reorganisation, as the Government might euphemistically call it, to take place under detailed scrutiny from Postwatch, which it is best placed to deliver because it has been working on this issue for several years. No one can take its place in that regard. Our amendment offers a middle way. We are not saying that the reorganisation should never happen but simply that it should not happen at this time of enormous turbulence for the Post Office, which provides a crucial service for people in rural areas and is equally important for people in suburban and urban areas. Finally, noble Lords on the Conservative Benches have raised the issue of the business sector. The business sector has asked me to express its disappointment at the Minister’s response on this issue. In particular, a letter stated that, “no detailed responses were made about the need to preserve sector-specific expertise and the representation of business interests in the postal sector”. In rural areas, nothing is more important for small businesses than the postal sector, and that applies equally to the business sector throughout the UK.
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- Lord TruscottNon-affiliated
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- My Lords, the amendment would require the Secretary of State to make an order to abolish Postwatch and to make that order subject to the affirmative resolution procedure in both Houses. Furthermore, the Secretary of State would not be permitted to make the order before 2010. I recognise the concerns raised by the noble Lord, Lord Razzall, and the noble Baronesses, Lady Byford and Lady Miller, but I agree with my noble friend Lord Whitty that one of the main objectives of the Bill is the creation of a cross-sectoral consumer advocacy body that is stronger than the sum of its parts in addressing consumer issues that frequently exist across sectors of the economy. The new body must have the critical mass to engage effectively with government, regulators and industry sectors on the basis of expert and informed analysis and have the benefit of being able to draw on experience and expertise from a number of sectors. We recognise that maintaining the existing sectoral expertise in the postal services sector is vital to the success of the new body. We also recognise the importance of this in a sector that has only recently been opened up to competition. We had a lively and informative debate in Committee on the principle of merging Postwatch with Energywatch and the National Consumer Council, and, given the extensive prior consultation on this issue, I am not convinced that it is necessary or appropriate to subject the proposal to incorporate Postwatch into the new council to the affirmative resolution procedure at a later date. On timing, I understand the concerns raised by noble Lords that the postal services sector needs a strong advocacy body in order effectively to represent consumer interests in the post office network restructuring programme. In recognition of the importance of this issue to consumers, the new council will, under Clause 15, maintain the current function assigned to Postwatch of investigating any matter relating to the number and location of public post offices. Having a strong consumer advocate in the postal services sector and maintaining the sectoral expertise that Postwatch has built up and which the new council will inherit are vital to the Government’s proposals for a sustainable post office network. We believe that delaying the inclusion of Postwatch in the new arrangements for consumer advocacy would merely prolong the uncertainty for existing staff and consumers and would increase the likelihood of staff retention problems and departures precisely at the point when Postwatch needs its staff most to feed into the post office network restructuring programme. The amendment would exacerbate the problem and be counterproductive, as it would extend that period of uncertainty, with consequent damage to morale and staff retention. After careful consideration, therefore, I am not convinced that a delay in the creation of the new National Consumer Council and the associated abolition of Postwatch would benefit consumers of postal services, who would be faced with a delay in the creation of a stronger consumer advocate, as mentioned by my noble friend Lord Whitty, to represent their interests, and redress schemes to provide them with complaints resolution and redress as appropriate. Indeed, a delay might actually be harmful, creating a longer period of uncertainty for the existing staff of Postwatch, which I do not think was the intention of the noble Baroness, Lady Miller.
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- Lord RazzallLiberal Democrat
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- My Lords, I thank the Minister for his reply. We debated this extensively in Committee. I suppose that the best argument against the amendment tabled in my name and that of my noble friend is that it will be the noble Lord, Lord Whitty, who is responsible for proving us wrong. However, I am afraid that I am not persuaded, for two reasons. First, I would be better persuaded if the world of this integrated authority to which the noble Lord, Lord Whitty, refers was that which is actually going to be put in place. We already know that the Department of Trade and Industry lost the internal turf wars and failed in its attempt to have a number of other councils, in particular the transport one, merged into the empire of the noble Lord, Lord Whitty. Secondly, the Government have already conceded that water will not come in until 2010. I am not sure why the arguments that apply to water do not apply in spades to the Post Office and the Royal Mail, for all the reasons that I set out. I do not want to repeat those arguments, as we know what they are, but on this occasion I should like to test the opinion of the House.
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