Consumer Rights Bill

Public Bill Committee, 25 February 2014.

Clause 17 - Trader to have right to supply the goods etc

Jennifer Willott (Liberal Democrat, Cardiff Central)

I welcome everybody back after the brief respite of the recess.

Before we went on our week’s break, we were debating the issue of logbook loans and the importance to consumers of knowing that there are no outstanding charges on an item when they purchase it. The hon. Member for Walthamstow moved amendment 9, which covers that point. It is of course important that consumers can have that confidence. When they buy goods they need to know that they are able to use them freely, without worrying that someone else might have a claim to them. If there is another claim on the goods the consumer must be made aware, so that it does not come as a surprise later.

Being able to use something freely and fairly is a fundamental part of buying it. I appreciate that the intention behind the amendment is to ensure that, so I am happy to reassure the Committee that clause 17(2) addresses the matter. The amendment is not clear as to how any assessment of the likely impact might be made, and I am concerned that that could be a source of dispute between the consumer and the trader. Subsection (2), on the other hand, requires that the trader notify the consumer of all outstanding claims or charges. That is much simpler.

If someone is buying something, they have the right to know whether there are any outstanding charges or claims against that item—that is sensible. In addition, subsection (2) provides stronger protection for the consumer, because everything has to be declared. I therefore ask the hon. Lady to withdraw the amendment.

Stella Creasy (Labour, Walthamstow)

I, too, welcome everybody back after our break. I am sure that having had a week to contemplate the excitement of consumer rights, we are all raring to go.

I thank the Minister for her remarks. It is welcome that she recognises that there is an issue to consider about the sale of cars, and I am pleased to hear that she thinks that subsection (2) will cover the issue. Our amendment would require a trader to make it known to a consumer that there was such a charge on a good. After reading through subsection (2), I am not sure where that requirement is. It mentions goods being free from any

“encumbrance not disclosed or known to the consumer before entering into the contract”,

but that does not necessarily imply that the trader has a duty to tell the consumer about any charges.

As we all know, one problem when someone is selling on a second-hand car is that possibly as many as one in four second-hand cars in this country have such a charge on them. There is a difference between being required not to sell something with a charge on it and being required to tell somebody that a good has a charge on it. Will the Minister tell the Committee why she thinks subsection (2) will require a trader to undertake that action? That is the aim of our amendment. If she could intervene to clarify that point it would be incredibly helpful, and we would be happy that we had received the assurance we wanted. Will she comment on that distinction between something that is known and something that is actually disclosed?

Jennifer Willott (Liberal Democrat, Cardiff Central)

My understanding is that the trader must notify the consumer of any outstanding charges. There might be circumstances in which somebody would purchase a good knowing that there was a charge and that they were taking on a contract that somebody else had signed up to, but my understanding is that the trader must notify the consumer.

Stella Creasy (Labour, Walthamstow)

The clause talks about goods being free from “encumbrance not disclosed” on transfer, but it does not talk about a requirement to disclose. For the record, is that the Government’s intention? For example, if a trader did not disclose, that might be an unfair contract term or something that a consumer would have a right to reject. The clause is not clear.

Jennifer Willott (Liberal Democrat, Cardiff Central)

If a trader does not tell the consumer of a charge that is outstanding, they will be in breach of subsection (2), which would therefore be a breach of contract.

Stella Creasy (Labour, Walthamstow)

I thank the Minister for that assurance that cars cannot be sold on without notification of a charge. It is welcome, and I am pleased that the Government have listened to the concern and made the situation clear. With that, I am happy to beg to ask leave to withdraw the amendment.

Sandra Osborne (Labour, Ayr, Carrick and Cumnock)

With this it will be convenient to discuss new clause 3—Right to supply unique goods—

‘(1) A trader offering unique goods for sale must provide the consumer with information to enable the consumer to directly identify the unique qualities of the good they are purchasing.

(2) Where a consumer cannot confirm the goods are unique in person, the consumer has the right to reject these goods at any point prior to consumption.

(3) Where the goods are for use in relation to an event of national significance the Secretary of State for Culture, Media and Sport shall reserve the right to designate further restrictions and conditions on the sale and resale of these goods in relation to their unique qualities.

(4) For the purposes of this section unique goods are defined as having distinct characteristics which would affect—

(a) the enjoyment of the goods by the consumer;

(b) the use of the goods by the consumer; or

(c) the inherent value of the goods in question.

(5) For the purpose of this section an event of national significance is one which is designated for this purpose as such by the Secretary of State for Culture, Media and Sport under the provisions of section 299 (categorisation of listed events) of the Communications Act 2003.’.

Stella Creasy (Labour, Walthamstow)

This is a follow-on from a debate we had before the recess about ticket touting, and in particular about what we can do to address some of the concerns we all have about the detriment that consumers experience when ticket touting occurs. New clause 3 is about trying to deal with the way in which the ticket touting market operates in the UK, particularly on the issue of access to tickets.

I hope some of the members of the Committee will forgive me for being repetitive about this, but some were not here for the earlier debate, and I am sure they will welcome a refresher. Before the recess, we talked about how the secondary ticketing market operates. The Opposition absolutely accept the need for a market in secondary ticketing. All of us have suffered the bitter disappointment of buying a ticket for a gig or event that we wanted to go to and found, alas, that the Whips have not looked kindly on our wish to be let off that evening to attend.

I particularly remember a severe source of pain. I had finally secured tickets to see the Wonder Stuff, a band I was a big fan of in my youth and who had finally re-formed. Alas, the House was debating the sad death of a former Prime Minister, and therefore I could add “Margaret Thatcher, gig-snatcher” to my list of concerns about her. I understood it was right to be in the House, so I had a spare ticket. We all recognise that there are times in our lives when we buy tickets for something and then need to sell them on. That is very different from what is happening now. Our concern, which the amendment is intended to address, is about something very different from individuals who buy tickets in good faith for sporting or cultural events. It is about people seeking to abuse the way in which tickets are sold in this country and causing consumer detriment.

With the new clause, we are trying to get at organisations, because touting is an organised crime activity, not just a consumer detriment. Dealing with ticket touting would also deal with a source of funding for organised crime, whereby tickets are bought up immediately or advertised for sale and consumers cannot be sure they can get access to them. We know that in some cases 60% of tickets for gigs and events are taken by botnets, which buy the tickets immediately. Anybody who tried to get tickets for Monty Python’s recent shows will have discovered that. The tickets were sold within seconds. They were not sold to thousands of Monty Python fans furiously tapping away at their computers, they were sold via botnets that swept up huge numbers of tickets immediately using computer programmes, therefore denying consumers the possibility of buying those tickets themselves.

We also know that there are huge concerns about tickets that do not exist being advertised for sale, again using secondary ticketing sites. It is estimated that up to 60% of tickets for some activities are taken up in that way, so the possibilities for consumers are twofold. Either they do not get the tickets to the gigs that they want, or they pay over-inflated prices and find that they are being sold a dud. They are being sold a ticket that simply does not exist, but by the point at which they discover it is a fake ticket or not for resale, they are too late and they have paid their money.

We know that the inflation on prices is substantial. In some cases it is more than 110% of the cost of the tickets. With the new clause, we are trying to identify the ways in which consumer detriment is generated within the ticket market without affecting the ability of ordinary fans to sell on their tickets if they so wish. We should bear in mind that the secondary ticketing market is an industry worth an estimated £1 billion.

What happens is bad enough for consumers, because it restricts their access to tickets for particular events. It is also terrible for the bands and organisers of activities themselves. They do not benefit from the sale of the tickets, nor do the venues. There might not be much sympathy for the O2, which might be seen as a commercially successful venue, but that happens across a whole range of organisations, so the money that is drawn out of our entertainment and sporting industries is substantial.

The problem also generates a lack of trust for consumers in what they can access and whether they can really buy a ticket for a particular event. We tried on Thursday 13 February to amend the Bill to address that problem by requiring traders to name who was selling tickets. One problem is people selling on tickets that they are given for free when it is not appropriate for them to do so. That particularly relates to sporting events with programmes designed to make tickets affordable, with tickets being sold on again at artificially inflated prices. Alas, the Government did not accept our amendment.

New clause 3 would do something slightly different. It would require a good to have a unique identifier. Put simply, it means that a ticket would include a seat number or a place in the venue, so that a person could be sure of what they were buying. When tickets were advertised, they would know whether they were buying a seat at the front or back of the gig, or that they were buying a particular ticketed seat for an event. That would mean that tickets could be cross-checked to see whether they could be resold, or to check that they actually existed and had not been sold to somebody else. That would be a simple way of addressing the confusion and lack of information about the sale of tickets that enables consumer detriment to occur.

The new clause would also do something else. All of us were very proud last year—I think that I can claim to be the only Olympic borough MP in this room—that we were an Olympic country.

Rebecca Harris (Conservative, Castle Point)

Is the hon. Lady aware that Castle Point hosted the Olympic mountain biking event?

Stella Creasy (Labour, Walthamstow)

I was not aware that Castle Point hosted the Olympic mountain biking. I actually watched the mountain biking, so to be able to place it in Castle Point gives me even more pride that it happened in our country at all. I am grateful to the hon. Lady, and I know that other sporting events occurred around the country.

My point is that, as an Olympic borough, we were deluged with people coming to our area looking to attend the Olympics. We were alive to the fact that people wanted to attend that event; so were the Government. All of us recognised that it was absolutely right to take precautions to prevent touting, which would have ruined ean event of such national significance. The Government did that in a number of ways. They raised the maximum penalty for touting from £5,000 to £20,000, but they also passed special legislation through an amendment to the London Olympic and Paralympic Games Act 2006 to protect the price and resale of the 6.6 million tickets for the Olympics. I was deluged by local residents who were determined to get access to the Olympics and who were delighted that they could bid online for those tickets. How different that experience was for them than the experience of Monty Python fans in my local community, or indeed fans of the Cure, whose concert for the Teenage Cancer Trust has also been overtaken by touting.

Next year, we have the rugby world cup coming—I believe it will be in the Minister’s constituency as well as at Twickenham. It is another event of huge national significance and the third most watched sporting event in this country. New clause 3 can help us to learn from the Olympics and how ticket touting was tackled, in order to provide the same protection that was given to tickets for the Olympics to tickets for all events of national significance. We all know that sometimes national significance is in the eye of the beholder. Some of us may feel that there are particular events that should receive national broadcast coverage—again, I go back to some of the gigs that I would like to have seen; I am sure that they would have made fantastic telly, but I accept that that may not be everybody’s view—but there are other sporting and cultural events that it may not be appropriate to cover in that way. We have examined the legislation that exists on events of national significance and tried to bring it into consumer protection law.

Fiona O'Donnell (Labour, East Lothian)

Many of my constituents will want to have the opportunity to attend the world cup, but they already have travel costs. There is real concern, because we do not want rugby to be an elitist sport. We must have effective regulation of the selling-on of tickets for such an event, and for all sporting and cultural events.

Stella Creasy (Labour, Walthamstow)

I absolutely agree, and so does the Rugby Football Union, which is desperately worried about touting. Indeed, there are already tickets for sale on secondary websites alleged to be for the rugby world cup. Given that those tickets have not gone on sale yet, it is distressing for the Rugby Football Union, as they are likely to be the tickets that were given to rugby clubs, which should not be sold. There is a real risk that, if consumers buy those tickets, they will simply turn up at the venue to be told that they cannot come in. There is also real concern about the prices. The Rugby Football Union has worked hard to try to ensure that there are affordable tickets, in the same way in which people worked hard to ensure that there were affordable tickets for the Olympics. It is right, when we have events of national significance, that we try to ensure that the nation can benefit from them, not just on our TV screens but by being able to participate.

Fiona O'Donnell (Labour, East Lothian)

Does my hon. Friend also agree that if this country is to make effective cases for holding global sporting and cultural events, having an effective system of regulation is a strong selling point for the UK?

Stella Creasy (Labour, Walthamstow)

I absolutely agree. In fact, visitors to the Olympics commented not only on the wonderfulness of the Olympic boroughs and the cleanliness of the streets but on the lack of touting, the good nature of the crowds and the management of public order around the sites. Being able to deal with ticket touting was clearly part of that, because ticket touting is intrinsically linked to crime. Being able to ensure that other events of national significance are not blighted by touting in the way in which previous events perhaps have been is a live concern for us.

Stephen McPartland (Conservative, Stevenage)

I am a member of the all-party group on ticket abuse. Is the hon. Lady aware of an organisation called Twickets? It enables consumers to sell their tickets at face value or less on the secondary market. That encourages consumers to use consumer power to get consumer choice, which is what the Bill is designed to do.

Stella Creasy (Labour, Walthamstow)

I am aware of that organisation. The challenge for us all is that it is being outdone by sites such as viagogo and the fact that people are selling on tickets or claiming to have tickets when there is no clarity about whether they do.

The problem that we are trying to identify through the new clause is twofold. One part is about the ability to identify a particular ticket, and consumers therefore being able to identify whether that ticket is indeed available for resale and really does exist. Let us say that someone thinks that they have bought tickets for the rugby world cup. They are there, willing England to win against the Welsh—[Interruption.] It will happen, I am sure. It is wonderful to see the Committee coming together in a cross-party fashion, but it is splitting on that point. The worst thing in the world would be for someone to think that they were able to attend that match, but not to be able to get in because the ticket that they had bought and thought was genuine was not a genuine ticket. The unique identifier would enable the Rugby Football Union and other organisations to be able to identify that a particular ticket was suitable for resale.

As I said at the start of my speech, we think that fans should be able to sell on tickets that they have bought but no longer require. However, we must protect them and the market from the unscrupulous behaviour of touts, who are abusing the fact that they can advertise in the way that we are discussing, the fact that they do not have to provide the information that has been described and the fact that there is great demand for some events. They are therefore causing consumer detriment.

Secondly, the new clause would give the Secretary of State powers to act as quickly as possible when it comes to events of national significance. There is a clear guideline as to what an event of national significance is in the Communications Act 2003, which reflects our broadcasting policy. We have tried to reflect that provision so that there is clarity about the events in respect of which the Secretary of State can intervene to protect consumers. We recognise that there is such demand for tickets for those events that it is worth ensuring that the Secretary of State can intervene in the successful way in which we intervened in respect of the Olympics.

My colleagues in the shadow Culture, Media and Sport team have tried to go to the Government and discuss the Rugby Football Union in time to ensure that there is emergency legislation to protect it for 2015, because obviously time is very short. So far, that has not progressed. I am hoping that we will make progress in the Committee today. The hon. Member for Stevenage, especially given his work in the all-party group on ticket abuse, will know of the strong passion for the issue that my hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson) has. He will know the real concerns that exist, the cost of the market and the impact of the crime associated with ticket touting. It is right that we look to make progress as quickly as possible, so that we can protect what will be an event of national significance and so that it can be a matter of pride, without concern that it will be overrun by touts. It is also right that we look to use this opportunity to protect consumers in relation to less well known events, such as some of the gigs that I might go to. I want to know that I can be confident, if I buy a ticket online, that it is a ticket for the gig that I am seeking to go to.

We think that this is a very reasonable new clause. It would do two very simple things. It would fit in with existing legislation and bring in the clarity of protection that I have described. It would mean that we would not have to have an argument about why, say, the darts is not an event of national significance, although I am sure that there are people who would want to make that argument. It would mean that we can give consumers confidence about the right move to make. I therefore hope that members of the Committee will support the new clause and encourage the Government to examine how we can not only codify existing pieces of consumer protection in the Bill but act where new markets are emerging.

Ten or 15 years ago this was not a problem, because there was not the technology to do what is being done now. The question for us all, when we see new markets emerging and new examples of detriment occurring, is how big a problem it has to become. How much damage has to be done to do to our entertainment, cultural and creative industries before we act in simple ways to protect consumers and those industries while giving consumers choice? The aim is to give them the information that they need to be confident about operating in that market. If we do not do that, the risk is not only the lack of funding to those industries and the cost to individual consumers, it is the loss of confidence in the creative and sporting industries.

There is real concern that thousands of rugby fans, who see prices on websites that are already at three or four figures for matches that have not yet been put on sale, will be able to watch an event of national significance only on TV. I certainly do not want that. I want young people to be able to get into stadiums at the affordable prices that the Rugby Football Union has set out. The new clause is designed to help ensure that. I hope that, even if the Culture, Media and Sport teams cannot agree on a way forward, we in this Committee can.

Fiona O'Donnell (Labour, East Lothian)

It is a pleasure to serve under your chairmanship, Mrs Osborne. I want to contribute to the discussion of the excellent new clause, not only because it is of personal interest but because I come from a constituency with much interest and a proud history in sport, culture and the arts. It does not surprise me that my hon. Friend the Member for Walthamstow, who is the stuff of wonder herself, should have such excellent taste in music.

Great sporting and cultural events are an opportunity for local communities. It is a shame they are often blighted by the actions of those who unscrupulously seek to benefit from them. Glasgow will soon host the Commonwealth games, which will be an opportunity to showcase the city and, more broadly, Scotland’s sporting prowess, which was most recently on show in the winter Olympics.

I am keen to see volunteers at the Commonwealth games who have been inspired by what we have seen in other parts of the UK, because of course we are always better together and can learn from each other. It is essential that we ensure that such events are accessible, especially the sought-after big-ticket events at the Commonwealth games such as the athletics. One inspiring thing about the 2012 Olympics was that there were opportunities for people on modest incomes, including some of my constituents, to be part of that wonderful sporting event. I am concerned that, as it stands, the Bill will not provide that protection.

My hon. Friend’s suggestion of having a direct link between the ticket that the consumer pays for to attend the event and a seat or position in a ground is a simple, not too burdensome duty to place on those selling tickets. The arts and sporting events can be tagged with the accusation that they are elitist and not accessible. Across the UK, we see genuine efforts by local authorities and Government to ensure that events are accessible. If we are to do that, we must have effective regulation of the selling-on of tickets for events, so that they are not abused by people who are looking for loopholes.

In the area of consumer rights more than any other, there is a problem in trying to keep up with technology and unscrupulous entrepreneurs.

Laura Sandys (Conservative, South Thanet)

I absolutely agree that there is a problem. One can look at responses from other sectors that issue tickets, such as the Association of British Travel Agents. I do not know whether Opposition Front Benchers have spoken to the industry to establish much more flexible mechanisms. I totally agree that in many ways criminality moves very quickly and we will never catch up using some of this regulation, but if we engage the industry, the ticket business, and say that it should come up with a dynamic, responsive and constantly evolving system, we will end up with something that is at the heart of consumer protection, rather than something that might be a touch out of date before it even starts.

Fiona O'Donnell (Labour, East Lothian)

As someone who is young in parliamentary terms, my experience so far is that flexibility for a sector can often lead to exploitation. I understand this Government’s reluctance to regulate and their red tape challenge, but one woman’s flexibility can be a ticket tout’s opportunity to exploit.

Stella Creasy (Labour, Walthamstow)

It is probably worth stating that the industry is very much in favour of action—I am sure that the hon. Member for Stevenage, a member of the all-party group, would back that up—particularly event hosts, such as the Rugby Football Union. The people who are perhaps more resistant are those running secondary sites, which should tell us something about whose side they are really on. Given that all tickets should have a unique identifier—a barcode, for example—we are not asking for information that these companies do not already provide. Tickets bought direct from the RSC, for example, would have that information; we are simply asking for it to be made available prior to sale. I do not think that the creative industries would oppose these measures—in fact, they have been very supportive. It is the secondary sites and those who are profiting from the touts being able to use their technology which are more resistant. We should ask which side we want to be on in that debate. We want to go forward, not back.

Sandra Osborne (Labour, Ayr, Carrick and Cumnock)

Order. Can we have shorter interventions, if at all possible?

Fiona O'Donnell (Labour, East Lothian)

Or, if I may be so bold, Mrs Osborne, perhaps further contributions to the debate are necessary. The hon. Member for South Thanet, given her concerns, may wish to take that opportunity. She makes an excellent point about how we try to keep up, especially in consumer rights, with the speed of change in technology. We see the proliferation of websites just now. If you google—there are other search engines available—a Government website, often at the top of the list are sites that charge.

I will not stray from the substance of the clause, Mrs Osborne, but I think my hon. Friend the Member for Walthamstow made it clear, in her informative and helpful intervention, that there is a willingness within the industry to work with the Government. The regulation really has to be fit for purpose and future-proofed as much as possible. The new clause is not too burdensome. I hope that in the spirit of protecting consumers—the aim of the Bill, after all—we can come together across the Committee this morning to support the new clause.

Stephen McPartland (Conservative, Stevenage)

Stevenage also had a little connection with the Olympics. We hosted a number of teams and Hertfordshire also had the Olympic canoeing, which was quite interesting for many of us. Stevenage is also home to the largest outdoor music venue in the country. We hear a lot about one nation, and Knebworth is the nation’s largest outdoor music venue. Robbie Williams played to a quarter of a million people at Knebworth—hon. Members can imagine the chaos that that caused, both on local roads and in terms of ticket touting. As a member of the all-party group I want us to do all we can to get rid of ticket touts, but I do not really understand how the new clause would work and so will not vote in favour of it today. I understand the intention behind it and I want to work across all parties to eradicate ticket touting, but for me the question is how the new clause would work.

I mentioned Twickets earlier to the hon. Member for Walthamstow. That organisation provides a secondary market: the idea is that you place an image of your ticket on the website and that ticket is then sold at face value or less. Unfortunately, a lot of ticket touting is driven by consumers who are prepared to pay any price to go to an event, and the new clause would not deal with that. How will we stop an hon. Member giving a ticket to a friend? How will we stop them selling that ticket and pretending that it is being passed to a friend?

Sheila Gilmore (Labour, Edinburgh East)

I agree that it is good for consumers to become more aware and for those wanting genuinely to sell tickets and those wanting to buy them to use sites such as the one the hon. Gentleman suggests. The problem is that a lot of the activity is highly organised soaking up of tickets and selling them through various means. The purpose of consumer legislation is often to protect people from themselves.

Stephen McPartland (Conservative, Stevenage)

I take the hon. Lady’s point on board, but I am not sure how the new clause will tackle the scourge of botnets buying hundreds of thousands of tickets for a variety of events across the country. I cannot support the new clause, because I do not understand how it would get rid of the scourge of ticket touts.

Stella Creasy (Labour, Walthamstow)

I am sorry if I did not make clear in my opening remarks how the new clause would work. One way that ticket touts get away with what they do is by not being transparent about what they are selling. Requiring them to provide a unique identifier, such as the barcode, the seat number and the stall, would mean that the ticket could be traced by the original vendor. For example, someone would know they had a ticket to a Robbie Williams concert, but they would also know that they had a ticket to a particular part of the park, so they could be confident in what they were being sold. That is how the new clause would deal with the lack of transparency that sites such as viagogo encourage.

Stephen McPartland (Conservative, Stevenage)

I would like to put on record that I did not go to the Robbie Williams concert, and that was not because I could not get a ticket.

Brooks Newmark (Conservative, Braintree)

I have listened carefully and I totally get the spirit in which Opposition Front Benchers tabled the new clause, but the devil is in the detail. I am still not clear about how one ultimately differentiates between selling a ticket and giving it to a friend, or meeting someone and giving it to them? Perhaps the hon. Member for Walthamstow, if she makes further remarks, can clarify that for me. I understand that touts jack up prices and abuse consumers and I heard what she said about allocating seats through a vendor so that a ticket can be traced, but I still do not understand the difference between giving a ticket to somebody and selling it to somebody. That is the real abuse, not the particular part of the stadium to which a ticket gives access.

Stella Creasy rose—

Stephen McPartland (Conservative, Stevenage)

That is an interesting point to which I am sure the hon. Member for Walthamstow would like to respond in an intervention.

Stella Creasy (Labour, Walthamstow)

This is a moment when I have very a contemporary intervention to make, because somebody bought me a ticket to see Robbie Williams—not at Knebworth, but I did go to a Robbie Williams concert. We are not trying to stop people buying tickets to take a friend to an event or even to pass them on—nobody wants to prevent consumers doing that. However, with 60% of tickets for some gigs being taken up by botnets, we want to prevent consumers being sold something that does not exist. There are two different issues. The new clause is not about selling somebody a ticket and it being a criminal matter for the police, but about what is happening online. The new clause would deal with the way in which the lack of information online is causing consumer detriment.

Stephen McPartland (Conservative, Stevenage)

I am grateful to the hon. Lady for that clarification. The botnets are still the problem and I do not think the new clause would get rid of them. In the myriad events I have attended throughout the country, from music gigs to sporting events, I have never had a problem getting my seat. I have also never bought a ticket from a tout because it is far too expensive, and I imagine that most consumers would choose not to do so. We should push further and harder on promoting and educating consumers about organisations such as Twickets, so that they purchase the ticket on the secondary ticket market at face value or less and do not pay over the odds. If you pay over the odds for a ticket, it can be a huge problem.

The hon. Member for Edinburgh East talked about protecting consumers from themselves. Ticket touting is a huge problem in Edinburgh due the comic festivals in the city. A number of members of the Committee agree with the spirit of the new clause but do not understand how it will actually work. I could support it if it focused on dealing with botnets, but at the moment I can only support the spirit of it without believing that it would do anything to get rid of ticket touts.

Laura Sandys (Conservative, South Thanet)

I totally understand that the Opposition are concerned about secondary selling sites and so on, but why is it not possible for legitimate sites and operators such as my hon. Friend represents so well to have some form of trust code like the ABTA sign? The public can have trust in such mechanisms. They can be totally dynamic and include new players and new business models, and people who are trying to rip the consumer off will never sign up to them.

Stephen McPartland (Conservative, Stevenage)

My hon. Friend makes a wonderful point. The best way to protect consumers is for tickets on the secondary ticketing market to be sold at face value or less, so that consumers know exactly what they are getting.

Brooks Newmark (Conservative, Braintree)

I am an avid fan of both sport and music, and many of my friends have come across the abuse that the hon. Member for Walthamstow describes, but I always go to an approved website and would never dream of going somewhere else. Surely it is best that the Government and we as individuals educate the consumer, to ensure that they go to fully approved websites and resellers rather than to ticket touts, where the abuses tend to be.

Stephen McPartland (Conservative, Stevenage)

My hon. Friend makes another good point, and I am sure the hon. Member for Walthamstow will want to intervene again on that point.

Stella Creasy (Labour, Walthamstow)

I am not sure which Members were here for the debate that we had on the afternoon of 13 February, but I made the point that one challenge is that botnets are buying up all the tickets for events, so people cannot go to a licensed seller to buy a ticket. They do not have that choice, because the botnets buy up the tickets within seconds. If Members want to test that, they can try to buy a ticket for the Monty Python shows, which I think were sold out within five minutes. They were bought not by real people but by botnets, and that is where touts get them from.

Stephen McPartland (Conservative, Stevenage)

The hon. Lady makes a good point. As I said, Members of all parties agree with the spirit of the new clause.

Oliver Colvile (Conservative, Plymouth, Sutton and Devonport)

My hon. Friend is making a powerful argument, but I am curious: does he think we can police businesses buying tickets for corporate activity? They may suddenly find themselves not requiring the number of tickets that they have bought and therefore wanting to offload them. I am not clear about what would happen in that case.

Stephen McPartland (Conservative, Stevenage)

My hon. Friend makes a good point. I am not clear about that, either. It is one reason why I can understand the spirit of the new clause but will not vote for it, because I am not sure how it would work in practice. The Rugby Football Union was mentioned earlier, and a number of the rugby world cup tickets that will be sold on the secondary market will be those that have been given to rugby clubs around the country. People within those clubs will then use those tickets for a variety of reasons. We must consider how to deal with individuals who are trying to make financial gain, which is a big reason. I am not sure that the new clause would stop the behaviour and actions of those people.

I have been a victim of botnets myself. I tried to see the terracotta army exhibition at the British Museum, but I could not. I ended up seeing it in Toronto, when I was on holiday. I had to fly across the Atlantic to see it in a Canadian museum, and tickets were plentiful. We could just turn up on the day and walk in.

Andy McDonald (Labour, Middlesbrough)

The hon. Gentleman makes an excellent point. Does it not provide evidence of how ordinary consumers in this country are being totally excluded from culture, arts and sports by the botnet companies that we are hearing about? People running such companies add absolutely nothing to the value of the product, so should we not take even more stringent steps to do away with the problem?

Stephen McPartland (Conservative, Stevenage)

I totally agree with the hon. Gentleman. I would like to get rid of botnets and the behaviour of those running them, but I am not sure how the new clause would do that. I am happy to work with the Opposition on how to get rid of botnets—as I said, I am a member of all-party group on ticket abuse, and I know that the industry itself is keen on getting rid of them.

Mark Durkan (Social Democratic and Labour Party, Foyle)

If the hon. Gentleman recognises that there is a problem—clearly, it is one not addressed in the Bill—and he supports the spirit of the new clause, why can he not support it on the basis that the Government could perhaps furnish a further answer to the problem as the Bill proceeds?

Stephen McPartland (Conservative, Stevenage)

The hon. Gentleman makes an excellent point. As the Whip will inform him, I do not always support the Government and sometimes vote with the Opposition if I believe it is right to do so. However, on this issue it is not something I feel I can do, because I would just be putting up a flag to say what I have said on the record: that I agree with the spirit of the new clause but do not believe it will get rid of the botnet problem.

Laura Sandys (Conservative, South Thanet)

There is another issue here. If there is a form of so-called legislative response, it is possibly not primary legislation. Do we not need to deal with this issue at the regulatory stage, where there is a little more flexibility? Secondary legislation can then be amended to ensure some form of dynamic that keeps up with the times. However, this is an industry issue and an accredited trade mark is needed.

Stephen McPartland (Conservative, Stevenage)

My hon. Friend makes an excellent point about those in the industry working together to get rid of the problem, which I know they very much want to do. I say again that I do not think anyone here supports botnets.

Mark Durkan (Social Democratic and Labour Party, Foyle)

Surely the answer to the intervention by the hon. Member for South Thanet is that the new clause allows for secondary legislation as well, so it is not a matter of either/or. It is clear from the way the new clause is framed that there would be secondary legislation as well.

Stephen McPartland (Conservative, Stevenage)

The hon. Gentleman makes an important point, but to protect the consumer and provide choice, it would be better if the new clause focused on saying, “We will abolish botnets and make botnet activity illegal”. However, in reality that would not be possible, as we know; a lot of such sites would still be around. However, the new clause would not do that. It makes specific recommendations but would do nothing to get rid of the botnet scourge.

I agree with getting rid of botnets and with the spirit of the new clause, but I cannot support it because it would not work in practice.

Mark Durkan (Social Democratic and Labour Party, Foyle)

It is a pleasure to serve again under your chairmanship this morning, Mrs Osborne. I accept that the hon. Member for Stevenage has expressed his support for the spirit of the new clause, if not its detail; however, I got somewhat lost as he developed his argument. He said he has difficulty with the new clause because he cannot see how it would do away with the scourge of ticket touts and companies established for such purposes, and that it would be impossible to do away with and legislate against them. Condemning a measure because it fails to do something that he says is impossible seems particularly strange.

We were told that it was not clear that the new clause went far enough; then, that perhaps it would not do what it said it would do; then, that it could not do what, in the hon. Gentleman’s view, would actually be impossible. That seems to be a bizarre reason for supporting the spirit of the new clause but not the clause itself.

Andy McDonald (Labour, Middlesbrough)

The RFU has said:

“Websites facilitating secondary selling should be accountable for the accuracy of the information provided to consumers. While there would be no requirement for websites to check the information is correct, they should be obliged to remove advertisements for tickets if they are informed that the ticket information is incorrect. Websites should also be obliged to remove advertisements for tickets if it is shown that the sale would be in breach of the event owner's ticket terms and conditions”.

Does that not clarify how the new clause would work?

Mark Durkan (Social Democratic and Labour Party, Foyle)

It does. If Members are concerned that the new clause does not go far enough or is not complete enough, that, of itself, is not a reason for not supporting it. Basically, it states that the Bill should be used as a vehicle for addressing this problem, which we, as legislators, have a responsibility to do. The hon. Member for Braintree suggested that the answer was not legislation but education—that we should be educating consumers. I am not sure how much of our time we can or should spend educating consumers if we can do an effective job, as legislators, of building in protections at the legislative stage and ensuring that the standards we are setting, of which consumers should be aware, are informing the behaviour and conditioning the performance of traders as well.

After all, we are talking not about tickets that might be picked up as a concession by a member of a rugby club, or passed on as a gift, but about firms that are in the business of hoovering up and hogging tickets and then retailing them at ruthless rates of profit. We are talking about parasitical traders—people who feed on the sporting and cultural life and tastes of all the people whom we represent. If we are not going to use this legislation to address the problem, and if we are going to vote down new clauses that try to do so, we must show that we have a better way of addressing the problem than just saying that we are going to educate consumers.

The fact is that people do not understand the difference between many of these websites. They search on the internet, and find themselves on a site that looks bona fide. It looks like they are buying an up-front, real deal, fair-price ticket, but it turns out not to be one. The new clause may not go the whole distance towards solving the problem. It certainly does not abolish such businesses—

Brooks Newmark (Conservative, Braintree)

I am listening to the hon. Gentleman carefully. This is one issue to which I came as a complete agnostic. I was originally persuaded by what the hon. Member for Walthamstow was saying, but the more I think about it, the more I think the devil is in the detail. I am curious. What is the hon. Gentleman’s view on the suggestion made by my hon. Friend the Member for South Thanet that there should be some imprimatur on self-regulation—a stamp effectively saying that a reseller is a pre-approved, trustworthy reseller who does not commit the abuses mentioned by Opposition Members?

Mark Durkan (Social Democratic and Labour Party, Foyle)

That is not necessarily inconsistent with the new clause, which would build in protections not by attacking particular classes of business but by providing assurances that the product being bought is the real-price product, that people know exactly where it is and that no jiggery-pokery is involved.

Brooks Newmark (Conservative, Braintree)

The difference is that it is not Government trying to chase technology around. Self-regulation is a much better solution to the problem than the Government trying to chase technology as it keeps moving ahead of legislation, as my hon. Friend the Member for Stevenage also said.

Mark Durkan (Social Democratic and Labour Party, Foyle)

We can say that little self-devised trading quality stamps are the answer, but that will constantly change as well. Who will police or approve any of that?

Stella Creasy (Labour, Walthamstow)

I think all of us want people to go to approved sellers and resellers. The challenge is that it is possible to buy up every single ticket for Monty Python within five minutes and then sell them on a secondary site without scrutiny of what is being sold. Consumers do not have a choice. Technology is denying them the choice of going to an approved seller, and denying approved sellers the choice of putting a restriction on who can resell their tickets.

Mark Durkan (Social Democratic and Labour Party, Foyle)

My hon. Friend’s intervention makes the point, bluntly, about the scale of the problem we are dealing with in some situations. It is not just happening at the margins and causing frustration to those who are priced out or who paid over the odds compared with the person sat next to them, who paid far less because they paid the fair, up-front price. We are talking about businesses growing themselves by eclipsing the fair-price ticket market for everybody else. That is a fundamental consumer problem, and we are hearing about it from people in the sporting world and the culture and entertainment world. We should be responding to that, as legislators.

Stephen McPartland (Conservative, Stevenage)

I very much understand the point the hon. Gentleman is making, and I am sorry that my argument was not as clear. In that case, would not the best way of proceeding be to introduce legislation stating that tickets cannot be sold on a secondary market for more than their face value?

Mark Durkan (Social Democratic and Labour Party, Foyle)

Yes, that could well be one answer and I look forward to the hon. Gentleman tabling such an amendment. If he does, provided that it is well furnished and well rounded, I would be ready to support it.

Brooks Newmark (Conservative, Braintree)

I come from the world of business and because we are—if not anything else—creative, there is, unfortunately, a way around that. If, for example, one goes to the Olympic games, the face value of the ticket to the event remains the same, but that ticket will be part of a package in which one must book a hotel room. The market is, and always will be, creative in finding ways around legislation—even Government legislation, if the hon. Member for Walthamstow will have it—and that is the problem.

Mark Durkan (Social Democratic and Labour Party, Foyle)

I accept the hon. Gentleman’s point, but limits could be put on such ways around. Consistent with some of the terms used in new clause 3, it could be made clear that even if a package is sold that includes attendance at a particular event, there is transparency around that if described as an event of national significance. In Northern Ireland, words such as “national significance” are matters of high sensitivity, so we would need to see some secondary legislation that allows for the situation there. My constituents in Northern Ireland may buy tickets for concerts and matches in the south of Ireland. Therefore, I can see that, in many of these situations, not all measures transfer easily.

I do not pretend that new clause 3 on its own would deal with everything for everybody everywhere, but it is a good, honest and sharply spotted attempt to try to use legislation to put limits on these operators who are being pretty ruthless. The fact is, if we do not legislate against them, we are effectively sending a signal to consumers that those businesses are legitimately engaging in fair trade. People will say to us, “Well, if you haven’t used consumer rights Bills to put any legal restraints on them and to create better assurances for us, that practice must be okay.” It would be odd for us to spend our time educating people not to fall for the false sales and inflated prices they are subjected to that we could have legislated against.

We know that there is a chronic problem. All hon. Members who have spoken recognise that. The new clause may not be the full solution, but it is certainly better than what we have in the Bill already. If we pass the new clause, the Government, both on Report and in another place, could furnish further amendments on framing the cover that would be needed for secondary legislation, as the hon. Member for South Thanet said. They could also ensure that words such as “national significance” and all the rest of it are not just subject to what the Secretary of State for Culture, Media and Sport is saying, but are informed by what is regarded as of national significance by the devolved territories.

All of the other trimmings that would be needed could be provided, but accepting the new clause today would send an important signal to these ruthless, predatory, parasitical traders. That is not to say that we should frame it as it is in law, but that would signal a good working intention on our part and serve notice that the Government would have the support of consumers and Members across the House if they used the Bill to do more in this area.

Tessa Munt (Liberal Democrat, Wells)

I know that the convention is that a Parliamentary Private Secretary does not address the Committee, but nothing in procedure prevents me from doing so. I rise to speak because I am the Member of Parliament for Glastonbury, which most people will have heard about, and it is relevant to speak on that for a moment, if I may.

Glastonbury festival, as people will be aware, has 200,000 visitors. Michael and Emily Eavis, who organise that event, do so with admirable precision. Historically, the festival had a number of problems with touts. I venture to suggest that there is no need for legislation. There are different types of tickets for the 200,000 people who attend. People attend on a local basis, as guests, as paying visitors—as I and my children do—helpers, supporters, band members and so on. All of those different types of ticket are dealt with in different ways. The event takes place in June but the preparation starts a year earlier, as with all the large events people have talked about.

As a customer, I register before the closing registration date. The customer uploads on to the Glastonbury festival website a photograph that will eventually appear on the ticket. Name, date of birth and a few other basic details are also required. That is the pre-registration phase. There is then a date in October to apply for tickets and only those registered are able to do so. At that point the customer buys the ticket, paying a deposit of about £50 per ticket. Then there is date about the beginning of April when the balance on the ticket has to be paid.

We need to educate the event organisers. There is no reason why that process should not be used for any event. If people wish to register it means there is no touting of Glastonbury tickets. It is impossible to get in without a photograph on a ticket. Tickets cannot be passed on. I can buy up to four or six tickets for my children but I have to have their details. There is a maximum that can be bought. One has to take a chance and punt along with everyone else. If one gets a ticket that is great; if not, that is a shame, but one has to look forward to next year. The Eavis family has dealt with historic problems of massive touting outside the festival site and through other means and various companies, and has done so effectively.

Brooks Newmark (Conservative, Braintree)

As a Glastonbury fan, I know the detail one has to go through to get a ticket, as do my teenage children. The problem is not the passion with which Mr Eavis wants to control his product through his ticket sales, it is that all that most ordinary event organisers want to do is put bums on seats. If someone hoovers up all their seats—the point the hon. Member for Walthamstow makes—they do not care, because they have got their money. All they care about is selling the venue, not controlling the end product. That is the challenge. I do not wish to make the hon. Lady’s argument, but I think that is what she was trying to say.

Tessa Munt (Liberal Democrat, Wells)

I take the hon. Gentleman’s point. It then becomes a challenge for the consumer to say to the organisers of rugby, football and music events what they are trying to do. If the organiser is in cahoots with touts, we can take a view about whether we want to support the firm that is doing that. There is a choice. The passion, as the hon. Gentleman says, that Michael and Emily Eavis have applied to this ensures that individuals get to see their events.

Consumers have purchasing power and can perfectly easily choose whether to support a particular event. It is a simple matter of using the internet to its best advantage, allowing people to pre-register. I did not get tickets for the John Cleese event. That was incredibly galling because I wanted to go. However, the process could have been simply applied. It is not difficult for organisations to do. There is a way round this and consumers can choose whether to support the event and whether to give money to organisations that do not look after the small person, the individual.

Jennifer Willott (Liberal Democrat, Cardiff Central)

This has been a good debate. It is nice to have some different perspectives coming out from Members of the Committee and it has been an interesting debate. I start by going back to brass tacks and to what this new clause does. It would place an additional information requirement on sellers of unique goods, such as tickets—which is what we are talking about, but the wording of the new clause is broader than that—and give consumers a right to reject if the consumer cannot confirm in person that the goods are unique. It would also, as we have heard, allow the Secretary of State for Culture Media and Sport to place restrictions on the resale of tickets for nationally significant events, although I take the point of the hon. Member for Foyle about the different weight that people across the UK give those words.

We all agree that consumers should be fully aware of what they are purchasing when they buy something. We have all heard horror stories from consumers who have bought tickets for a sporting or music event, which turn out not to be what they say they are. That can be extremely upsetting for people, particularly if they find out just as they get to the event. It can be expensive as well; some of these tickets cost vast sums of money. While it might be tempting to take further action, there is already significant consumer protection legislation in place and there is more coming into force this year to ensure that consumers have that protection.

The first part of the new clause places information requirements on traders who offer unique goods. Current law already prohibits traders from engaging in unfair commercial practices against consumers, which includes misleading practices such as selling a ticket that they do not have or a fake ticket. Giving false or deceptive information and descriptions—[Interruption.] I obviously said something that people did not like, there is a mass exodus from the back of the room. Giving false or deceptive information and descriptions or leaving out important information, which misleads consumers into buying things, is covered by the Consumer Protection from Unfair Trading Regulations 2008, known as the CPRs.

Sheila Gilmore (Labour, Edinburgh East)

The Minister might go on to this but perhaps she could explain what the enforcement mechanisms are for the individual consumer who is caught by something like that under the arrangements that she is describing.

Jennifer Willott (Liberal Democrat, Cardiff Central)

The hon. Lady anticipates my next words. The CPRs carry criminal penalties and they are enforced by local authority trading standards officers and the Office of Fair Trading. They can also be enforced via injunctive action under powers in the Enterprise Act 2002. There is a range of ways that those regulations can be enforced. In addition, the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, which we discussed a number of times the week before last, implement the consumer rights directive and set out details of the information that a trader should provide to a consumer for all distance sales—which would include tickets—such as what are called the main characteristics of the goods, or the information about the item itself. These regulations, as I said the other week, will come into force in June. The protection that this part of the new clause seeks to provide is already there in the CPRs and the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013.

Hon. Members asked how we can ensure that websites selling tickets are legitimate and a number raised the point about how we ensure that people have information about which websites are legitimate and which are not. Rules on misleading websites are enforced by the Advertising Standards Authority which, last year, looked at 130 websites to check compliance. It has given evidence to this Committee, which I am sure every hon. Member has read, in which it states that, in 2014, 650 websites will be monitored. It is stepping up its enforcement activity to look at this issue.

We need to evaluate the problem carefully when we are identifying what the solution should be. I cannot remember which hon. Member talked about 60% of sales being to botnets. That statistic is actually from the United States. In the UK, we have quite a different set-up; it is a different market. Here, as I think the hon. Member for Walthamstow said, 90% of sales of second-hand tickets are from consumer to consumer. Although 10% of the sales in the secondary market will include some sales that involve ticket touts, 90% of them are consumer-to-consumer sales, rather than involving the issues that we have been talking about.

The Select Committee on Culture, Media and Sport looked into ticket touting a few years ago, and one of the things that it looked at was the scale of the issue. The Office of Fair Trading said that it was concerned about the difficulty of trying to regulate the 10% of the market where the problem lies without damaging the 90% where it works fine, because it is just people selling an extra ticket that they bought for a friend or whatever. We need to ensure that we do not make it too difficult for people to sell on tickets. As the hon. Lady said, that is a perfectly valid thing for people to do if they buy a ticket for an event that they then cannot go to—because their Whips have refused them permission to leave, for example. There needs to be a way in which people can sell tickets on when they have legitimately paid for them, to ensure that someone else can get the benefit and attend the event. Trying to regulate in a way that does not undermine that part of the market is quite challenging.

However, there are also non-regulatory options. Almost every study on this issue sets out a range of innovative ways in which event organisers and secondary marketplaces have protected customers. A range of options are available. My hon. Friend the Member for Wells highlighted how Glastonbury has taken action. There are measures such as requiring photographs to be put on tickets, which a number of organisers do, pre-registration, releasing tickets in batches and working with fans, supporters clubs and so on to ensure that there is better protection for consumers. When the Culture, Media and Sport Committee looked into the issue, it agreed with the OFT that those solutions were preferable to legislation, because of the impact that there would be more broadly.

Andy McDonald (Labour, Middlesbrough)

We have heard about the good practice at Glastonbury, but does the Minister see that as easily transferable to other events? There seems to be a commitment on the part of Glastonbury’s proprietors to go down a particular path, but does she think that realistically that is likely to spread right across the spectrum to other events of national significance?

Jennifer Willott (Liberal Democrat, Cardiff Central)

There are a variety of ways in which organisers can take action. Clearly, different organisers will do different things, depending on what their market is, how big the event is and so on. What is appropriate for Glastonbury, with 200,000 people, or an event at Knebworth with a quarter of a million people, will not be appropriate for other events. The requirements will be completely different for a much smaller event in a much smaller venue. It is therefore difficult to lay out precisely what people should do, but organisers can and often do do a variety of things, which they adapt to the event and the venue to ensure that they are appropriate.

Let me come back to the point made by the hon. Member for Edinburgh East about enforcement for individual consumers. We will amend the consumer protection regulations later this year to give individual consumers private rights as well in respect of misleading practices. That will include a right to have their money back. Quite a comprehensive framework is already in place, and we are improving it.

A number of hon. Members talked about botnets, which I think we all know are a problem. They appear to be more of an issue in the United States, but they are an issue here as well. A number of people have raised concerns about that. The industry is able to block botnets, and some organisers already do that. I do not think that legislation is the answer. First, how would we police a ban? That would be very difficult to do. The hon. Member for South Thanet made the point that technology develops incredibly quickly, and if we place something in the Bill, people will just amend the way in which they use technology to ensure that they find a different way around it that does not fall under the exact wording.

Andy McDonald (Labour, Middlesbrough)

The Minister raises the question of how we police things. Surely we prosecute people and then fine them. We might even extend the power to send people to jail. Is that not what the law is for?

Jennifer Willott (Liberal Democrat, Cardiff Central)

The hon. Gentleman misunderstands. I am saying that the technology is developing so quickly that no matter how we put it in the Bill, people will identify different ways of doing it that does not get caught in the exact wording in legislation. This area of technology is developing so fast, as we have seen since the previous legislation, that people have identified entirely new ways to hoover up tickets and make money. My concern is that it would be too restrictive to put such a requirement in the Bill; it would quickly become redundant, and people would find ways to get round it. In addition, rogue traders would still use such tickets and the market would move underground. That would be bad for consumers, and it was a concern raised by the Culture, Media and Sport Committee. If we drive the market underground, it will make it even more difficult for consumers to get a fair deal.

The intention behind the new clause is to require unique identifiers to be added to tickets. I do not think that it would achieve that, but I understand the intention. As I said, the industry is already using such measures in some cases, but it should be on a case by case basis and it should be flexible. I do not think it would be appropriate in the Bill to require that all tickets should have a unique identifier, because some event organisers would not want that for a much smaller venue.

We are talking about tickets for sporting events and music events. There is a fantastic music venue up the road from where I live in Cardiff. It is called the Globe, and it has a huge variety of music acts on a regular basis, but it is quite a small venue and it would probably not be worth its while financially to have a lot of requirements placed on it. It would make some venues less financially viable, and it might have an impact on the market. It would not be commercially worth while. I have concerns about putting such a requirement in the Bill when the market that we are talking about is so varied. It should be for organisers to identify when it would be appropriate.

Mary Glindon (Labour, North Tyneside)

What concerns me is that the Minister is not thinking primarily about the consumer. I thought we were talking about consumer rights, so the considerations of the marketplace should be secondary to how we can support consumers.

Jennifer Willott (Liberal Democrat, Cardiff Central)

First, I have made it clear that there is already protection through the consumer protection regulations and the consumer contract regulations, both of which contain significant protections for consumers. Also, it is not in consumers’ interests if a number of venues close because it becomes too expensive to issue tickets. It is important for people to have a variety of venues that they can go to for music events, sporting events, theatre events and so on in venues of different sizes. We have an extremely healthy culture, arts and sports scene in this country, and I want to ensure that remains available for consumers. I am saying that the protection is already there, with more protection coming in later this year. We do not need to put such requirements in the Bill.

Sheila Gilmore (Labour, Edinburgh East)

Given what the Minister has just said, I can think of some fringe venues that would be delighted to have people in their venues at all, let alone worrying about ticket touting. Is the Minister open to looking at something that would put a size limit on the new clause? If the concern is about small venues finding it too difficult, is there a case for looking at this and refining it in the way she suggests?

Jennifer Willott (Liberal Democrat, Cardiff Central)

We do not need it in the Bill. There is significant consumer protection already in place, with more coming into the consumer contract regulations in the summer. Also, as I said, we will be amending the CPRs later in the year. Such a measure is too prescriptive to put in the Bill. It should be up to event organisers to deal with the issue themselves. There are a lot of options out there. It is an innovative sector and people find new ways to tackle such issues on a regular basis. We should leave it to organisers to look at ways to do that while ensuring that the legal framework is in place to protect consumers. With the CPRs and the consumer contracts regulations, that framework is already in place and will be improved later in the year.

Proposed new subsection (2) would give consumers the right to reject unique goods bought at a distance. Under the Bill, and under existing legislation, consumers have the protection that goods must be fit for purpose and traders must have the right to sell those goods, as we have discussed. If not, a right to reject is already available. Making that right to reject unlimited in all cases, as the proposed new subsection would do because its wording is so broad, would place an unacceptably large burden on traders.

Proposed new subsection (3), which the hon. Member for Foyle spoke to, would allow the Secretary of State for Culture, Media and Sport to make specific provision for important events. The Secretary of State can already take action where needed. We created regulations for London 2012, as the hon. Member for Walthamstow highlighted.

The Under-Secretary of State for Culture, Media and Sport, my hon. Friend the Member for Maidstone and The Weald (Mrs Grant), who is responsible for sport, met England Rugby 2015 recently. Officials in the Department for Culture, Media and Sport are in regular contact with the chief executive officer of the rugby world cup and her team, and have provided advice on the range of options available to manage the risk of ticket touts. Officials have also been meeting Ticketmaster, the ticketing partner for the rugby world cup, to discuss the options available to event organisers, including using barcodes, named tickets, staggered release of tickets and rewards to fans with a history of support. A range of options are available. Those things can already be done and are already in place, and we do not need the new clause to enable them to happen.

I hope that I have responded the questions and points that hon. Members have raised. I therefore ask the hon. Member for Walthamstow to withdraw the new clause.

Stella Creasy (Labour, Walthamstow)

I certainly agree with the Minister that we have had an interesting debate this morning.

The first test for us with the new clause is whether we think there is a problem—do we think that ticket touting is causing consumer detriment in this country? I think there is genuine broad agreement across the House that there is a problem caused by some technologies. I know that the Minister will want to say that it is a small part of the market at the moment. Our concern is, how big does it have to be and how much of an impact does it have to have on people’s ability to get tickets for events, and therefore on the industry? Let us be clear: ticket touting is not welcomed by the industry and is not what creative artists want, because it puts money not into funding their industry and venues, but increasingly into the pockets of organised criminal gangs.

If we accept that there is a problem, one of the first questions we have to answer is: why does the Bill not do anything to address it? The Minister says that existing legislation already deals with the problem. If so, why is there a problem now? It cannot be both ways; we cannot say that there is a problem, but existing legislation addresses it, because people are clearly unable to exercise their rights.

My hon. Friend the Member for Edinburgh East put her finger on the pulse regarding the question of how someone can get their money back. If someone has been sold a dud ticket through an intermediary resale site, how do they get their money back? Certainly the resale sites themselves would not take responsibility for that dud sale. The new clause is intended to answer that question without introducing a huge regulatory burden on the industry.

I absolutely take the hon. Member for Wells’s point about what has been done in Glastonbury. I am sure that the hon. Member for Braintree, with his deep concern about regulation and Government intervention, agrees that asking businesses to have such an intensive system for one event at one point in the year, which a particular organisation does nothing but organise, is different from the issue of small venues hosting regular comedy shows—Monty Python shows, for example. There is a difference.

Tessa Munt (Liberal Democrat, Wells)

Actually, it is commonly the case that smaller venues have regular return visitors—people who sign up to mailing lists and so on. That is precisely the point. It is so easy to register as a user that the local and regular customer can be looked after first and best.

Stella Creasy (Labour, Walthamstow)

As someone who very much looks forward to the EMD cinema reopening in Walthamstow, both as a cinema and a music venue—for which I am determined that the Wedding Present, my favourite band of all time, will be in the opening slot—I very much welcome the idea of registering at a local level. However, I do not think it is feasible when we talk about touting, say, in the west end. Are we really saying that we cannot do anything to protect tourists from ticket touts, or about the money that does not come into the west end, which we know has struggled in recent years, but instead goes into the pockets of the touts when tourists cannot register in that way?

Tessa Munt (Liberal Democrat, Wells)

Having spent 10 years of my life working in hotels, I know it would be perfectly possible for some of the larger hotels in the west end—or any of the small hotels and bed and breakfasts—to register themselves as an approved registered person and make sure there were tickets for their guests.

Stella Creasy (Labour, Walthamstow)

I am interested in the hon. Lady’s presumption about the levels of bureaucracy that we create around the touting market. I would contend that what the new clause suggests would be simpler. Surely any organisation would have a unique identifier. A small venue should have a limit on capacity—that is a health and safety regulation—so it would have a limit on the number of tickets it could sell for any particular event. Therefore one should already be able to identify the ticket without requiring hotels to register in advance to get people into a venue, or making them have a system where they take a photograph of every person who might want to buy a ticket.

Jennifer Willott (Liberal Democrat, Cardiff Central)

The hon. Lady makes precisely the point that I was trying to make. Each venue and setting will have a different requirement. By putting requirements into the Bill, she would make it much more prescriptive, when it is much more appropriate to allow venues and organisers a range of available options, or find potentially new ways of protecting consumers that may not yet have been identified. They would then be able to choose for themselves the most appropriate way to protect their customers.

Stella Creasy (Labour, Walthamstow)

I am glad that the Minister agrees that we need to protect consumers from ticket touts. What I question is whether this Bill will do anything about it if we do not include a provision such as in the new clause. I disagree with the Minister’s point that the new clause’s wording would not give that flexibility, because mentions a unique identifier. If someone has sold tickets for a gig, they should have a limit on the number of tickets they are selling, because they should not be able to sell 1,000 tickets in a venue that can take only 200 people, for example. So there should be ticket numbers 1 to 200, and the venue should already have that. That is separate from requiring venues to have a whole new system of regulation, taking people’s photographs and registering them, in the way that Glastonbury has been able to do. That is not to denigrate what Glastonbury is doing, but it is an intensive process.

What we seek here is to use the information that already exists to deal with the problem. Ticket touting has been allowed to proliferate, and we must accept that there is a problem. That proliferation comes from the lack of transparency about what ticket someone is buying and who is selling it. Government Members voted against our proposal to make traders reveal themselves as one way of dealing with the problem. That would have dealt with one of the problems caused by botnets, because the companies behind them could have been identified.

New clause 3 would build on that principle by asking what information is already out there: what information should the seller of a good, of a ticket, already have? Is it a ticket for the stalls, right up by the stage, or is it for the gods? If consumers are going to buy it, they should know that. They should not just buy a ticket for the Monty Python show, they should be able to know whether they will be sat behind a column, for example, which they would know if they had the ticket number, and any venue would allocate a ticket number. That information already exists. All we ask is that people selling on tickets provide that information as well. That is separate from starting up a new system of regulation. It would enable us to deal with the challenge of people buying up tickets in bulk to sell on at inflated prices, because it would allow venues themselves to take responsibility for what is happening.

That is where organisations such as the Rugby Football Union come into this, because it is a not-for-profit company, and asking it to have the same burden of regulation and bureaucracy to deal with rugby tickets is not feasible. This new clause would allow them to identify those clubs and individuals to whom they perhaps have given tickets. The hon. Member for Plymouth, Sutton and Devonport identified corporate sales. The Rugby Football Union is keen to identify clubs that are breaking its rules designed to enable young people, families and rugby supporters to get tickets for national events. Where clubs abuse the tickets they have been allocated by selling them on, a unique identifier would allow the RFU to identify the club and take action.

The Minister has not addressed the Norwich Pharmacal order that the RFU has brought against viagogo to deal with this challenge. I am not convinced by the Minister that existing legislation would deal with the problem. If it did, we would not have the problem. Nor am I convinced that the future protections she talks about would address the challenge of identifying in a simple, regulatory light way, how to tackle ticket touting.

During the Olympics, the ability to buy back tickets allowed the organisation and venues to deal with people who wanted to re-sell tickets. Nobody is talking about stopping people being able to re-sell tickets. It is rather about holding people to account for what they are selling. That is a different point and is proportionate.

Educating consumers to use verified sites is fantastic, but that presumes that all tickets will be sold through such sites. We are trying to deal with the fact that there is not a level playing field for the consumer. Organisations are breaking the rules and there is increasing evidence about the impact that has. How long do we wait? I take the point made by the hon. Member for Braintree about creative ways to get round the legislation. However, if we took that principle in this House we would never do anything, would we? Given the evidence from the industry that supports the proposed new clause—

Brooks Newmark (Conservative, Braintree)

The whole point of legislation is to be clear, simple and effective, with an ability to deliver. If we create legislation that the market can circumvent, we are wasting our time. The hon. Lady’s proposal would do just that. It is well meaning but does not stop people circumventing the system, which she is trying to stop.

Stella Creasy (Labour, Walthamstow)

I dispute the hon. Gentleman’s point. The industry backs this measure precisely because it would tackle the problem about transparency of sales. That is why the Rugby Football Union supports the proposal and why the ticket-touting industry opposes it. I am sure the all-party parliamentary group investigating ticket touting will discuss the proposed new clause. It is a simple measure that says a consumer should know what they are buying.

The proposed new clause refers to the inherent value of the goods. That would be knowing that the ticket is genuine and whether it is for the gods or the stalls. It would enable a venue to identify whether a ticket has been resold when it should not have been, purely from information already on a ticket. It is a proportionate measure that is widely supported. I hope we can see progress on it.

I take the point made by the hon. Member for Foyle about national significance. However, if we support the new clause at this stage we could on Report deal with some of the issues he raised. We could also deal with some of the concerns about how to make it proportionate. The point is that as it stands the Bill does nothing about the issue. It simply gives up when we think we should be making progress.

Mark Durkan (Social Democratic and Labour Party, Foyle)

Does my hon. Friend recognise that, in accepting this measure and looking further at the issue, we might also target events billed as charity events? Many charities have been scandalised when bona fide concerts that they have run have been violated by these predators.

Stella Creasy (Labour, Walthamstow)

I absolutely agree. If this measure would address ticket touting—and the industry says that it would—why should we expect charity events to put a proportion of the money that they might raise towards preventing touting? If we can introduce simple legislation to enable venues to take action and to deal with the detriment to consumers, it would give a realistic right of redress, as my hon. Friend the Member for Edinburgh East pointed out. If someone is sold a dud ticket on viagogo they have to write off the cost. Identifying who sold the ticket and proving that it was a dud is not runner.

Jennifer Willott (Liberal Democrat, Cardiff Central)

I just put it on the record that viagogo has submitted evidence to the Committee stating that it will give refunds or arrange for another ticket. In many cases, what the consumer wants is a ticket to the event. For many people, the ideal outcome would be for another ticket to be issued so that they are able to attend,

Stella Creasy (Labour, Walthamstow)

The Minister puts her finger on the issue because that implies that it would be possible to get a ticket in the first place. We are talking about the resale of tickets and the secondary market for events that are sold out. There is no choice in that market, which is an area of consumer detriment. It is right to make progress on that in this Bill. I am afraid that we are not convinced by the Minister’s words, so we will seek a Division on new clause 3 at an appropriate point. I urge other members of the Committee to consider the matter, to talk to people and even to go on some of the sites to try to buy tickets so that they might experience the clunking Monty Python foot of disappointment when people cannot get the tickets that they would like and ask how we can simply and effectively protect consumers, as Opposition Members seek.

Clause 19 - Consumer’s rights to enforce terms about goods

Stella Creasy (Labour, Walthamstow)

I beg to move amendment 11, in clause 19, page 10, line 6, at end insert—

‘(4A) Where the installation of goods leads to a risk to the consumer, as set out in the Housing Act 2004, the consumer retains a right to a full refund of the cost of the contract and any additional fees associated with the installation.

(4B) Any action taken under subsection (4A) will not prevent the consumer from seeking other remedies or further compensation for the consequences of the installation.’.

Our consideration of the proposed amendments to clause 19 might turn into a therapy session for the Committee as we share our personal woe due to problems experienced as consumers. The amendments are about what can be done to put right things that go wrong. In particular, the amendments seek to address the frustration when a consumer is sold something they know not to be appropriate and they have to argue it out.

Let me start the ball rolling with my own tale of woe, and I reassure the Chair that it is relevant to amendment 11. I bought a kitchen, and the kitchen fitters miscalculated my kitchen by 10 cm, which might not seem very much but, as everyone knows, it is everything to a kitchen. The fitters proceeded to try to fit the kitchen, causing considerable detriment to my kitchen. Under the Bill, a consumer will have the right to challenge and the right to a repair. A kitchen fitter who cannot measure a wall accurately and who started to do things that caused cracks along the walls was a considerable concern to me, and I am sure Members on both sides would agree that it is distressing to come home to find such a mess.

The amendment recognises that the Bill is trying to clarify the rights that any of us would have were we to be sold something that is faulty and in need of repair, but it also recognises that there will be instances in which requiring a consumer to seek a repair before they can get a refund might not be appropriate. We all recognise that the devil will be in the detail. There are some things that a consumer might say are not appropriate that a trader would say was perfectly fine. There might be points at which it is right to seek a repair. Having gone through the trauma of trying to fit a kitchen, I fully accept that things are not always as easy as they might look, which is not necessarily the fault of the trader, so it is about putting things right.

The Bill, which requires consumers to seek a repair before they can seek a refund, should also contain flexibility by recognising that, in some circumstances, there may be occasions on which seeking a repair is simply not feasible or fair to the consumer. The consumer might feel, as I felt, that the trader is so hopeless and dangerous that allowing them further opportunity to repair something is not appropriate. The amendment would simply clarify that, with the right to repair, there are circumstances in which the consumer can go straight to a refund because the trader has been so terrible. That would give consumers in those specific circumstances the opportunity to say, “Let’s not even attempt to repair the item; this has gone so far beyond resolution that I should just get my money back.”

How would we define those circumstances? We recognise that in most cases it is fair to ask a trader to fix problems, and that that is also to the benefit and in the interests of the consumer: if two thirds of someone’s kitchen has been fitted they would rather have the final third sorted than have to start again. We have come up with a test that builds on the housing health and safety rating system brought in under the Housing Act 2004. That is proportionate, as it looks at risks to life and limb and at potential risks and hazards.

If a trader has performed a service in a way that is liable to give cause to believe that there is a serious risk or hazard to a property, and an environmental health officer has seen the situation and agreed that there is a problem, a consumer should not be asked or required to get the same trader back in again before they can get their money back. When a trader has been that poor at their job, a consumer should not have to put up with that a second time; they should simply be able to get their money back.

That is what amendment 11 is really about. In what circumstances does the Minister think it would be fair for a consumer to say to a trader, “I can’t have you back in my home,” or “I can’t have you playing with my car,” or “I cannot deal with you, because I have no confidence in you: you almost lost me a limb,” or “caused me to crash my car” or “to lose a wall”—as I am sure my kitchen fitter was attempting to do at one point to find those extra 10 cm? If, for example, a consumer bought a gas cooker, complete with installation, and the gas engineer came to fit it but in doing so caused a gas leak, should that consumer be entitled simply to reject that gas cooker and get their money back, or should they be forced to ask the same fitter to come back in to do repairs before they could get their money back, even though they know that that person almost blew up their house? That is the test we are setting today. The amendment would set some strict requirements for when a consumer could go straight to a right to refund, because we do not want to deny the trader the opportunity to put things rights, and we recognise that sense of natural justice. However, there must be circumstances in which we should be flexible enough to deal with the situation differently.

That is the aim of amendment 11. We have tabled other amendments about the right to reject and the remedies people will have under the Bill, which we will come on to. I hope that Members on both sides will recognise the circumstances I have outlined. Indeed, I wonder whether others here have had cause to lose confidence in a trader such that they simply do not want to deal with that trader any more, and, indeed, that the trader could be quite a dangerous person. If so, amendment 11 would help to deal with that eventuality and I hope Members will support it.

Jennifer Willott (Liberal Democrat, Cardiff Central)

As the hon. Member for Walthamstow has highlighted, the amendment seeks to protect the consumer if a faulty installation of goods puts them at risk, by giving them an immediate right to a full refund without having to accept a repair. I think we can all agree that a consumer should not be placed at risk as a result of goods not being correctly installed. I have huge sympathy for her over her kitchen, and can go one better: when I had a bathroom installed in my old house, the builder took down the chimney breast at the end of the house and the entire rear wall started falling down. To be fair, it was not his fault, but it was a deeply traumatic experience and I can sympathise completely with her over the cracks in her kitchen wall and the impact that situation had on her state of mind.

The Government want the Bill to deliver the best outcome for both consumers and traders. That should be a position where the consumer has the goods that they wanted installed in a safe working condition. The Bill provides that if a consumer contracts for goods to be both supplied and installed, and the installation is not done correctly, the consumer would be entitled to ask for the goods to be installed again. That approach allows an opportunity in the first instance for the trader to put right what was wrong with the goods, namely the installation, provided that the goods themselves are fine. That is the appropriate remedy if, for example, the incorrect installation was accidental rather than because of incompetence.

However, I completely understand where the hon. Lady is coming from on this matter. Where the installation has been carried out by a trader who has left the goods in a dangerous condition, the consumer could understandably be extremely reluctant to allow the trader back into their home—or whatever is left of it after the trader has had their way. In that case, the consumer can immediately seek damages to obtain financial compensation for the loss they have suffered. That could include the cost of the goods themselves and any consequential damage that the faulty installation has caused, depending on the specific circumstances of the case. That is an important alternative if the consumer has lost all faith in the installer’s ability to carry out a safe installation.

I believe that the Bill offers sufficient protection to a consumer, because it enables that alternative, so I do not believe that the amendment is necessary and I ask the hon. Lady to withdraw it.

Stella Creasy (Labour, Walthamstow)

I thank the Minister for that. Will she clarify at what point a consumer will have the right to seek damages, as opposed to being required to seek a repair before they can seek a refund? What will the test be for that?

Jennifer Willott (Liberal Democrat, Cardiff Central)

It is an alternative route. The consumer could pursue the route of having a right to repair by asking the trader to come back and reinstall or repair the work that he did, or he could go down the route of seeking damages instead if he was not happy to have the trader in. There is an alternative route that the consumer can take that enables him to claim damages more broadly for the associated costs.

Stella Creasy (Labour, Walthamstow)

For clarity, that means that a trader could challenge the process and say, “Actually, we should have the right to repair if damages are sought against us.” We are talking about extreme examples, and it would certainly help if there were test cases in courts, for example, with people seeking damages for the damage done. For the record, however, if a trader disputed that they were responsible for a wall falling down, for example the consumer could say, “It caused such a risk to life and limb, such a level of damage, that I felt that this was an appropriate remedy, rather than going down that other route.” I want to clarify that there is an ability for people to specify that route and that there are some tests.

Jennifer Willott (Liberal Democrat, Cardiff Central)

My understanding is that they are two separate legal routes that can be pursued, so that a consumer can either take the route of asking the trader to come and reinstall or repair the goods, or take the route of applying for damages. Clearly, at that point the trader can challenge that if they say that it is not good enough, but damages are an alternative route that the consumer can take.

Stella Creasy (Labour, Walthamstow)

In that case there could be a situation in which a consumer feels he has lost confidence in a trader, but the trader argues that he should be given the right to repair, or that the consumer has not exercised a fair judgment or assessment of his work. I note what the Minister says about the two separate routes, but we are trying to identify instances in which a trader might push back. How can we ensure that a consumer can feel confident in saying, “No, I would rather go for damages”?

Jennifer Willott (Liberal Democrat, Cardiff Central)

The trader cannot require to repair the goods. They are two separate routes of redress. The consumer has the decision as to which route he wants to take, and if he wants to pursue the route of damages, he has the right to do that. The trader cannot demand the right to repair if the consumer has lost faith.

Stella Creasy (Labour, Walthamstow)

Presumably, though, if it came to court the trader could argue that he should have been given the right to repair and that the consumer had not made a fair assessment. However, the point has been made, and I have no wish to delay the Committee further.

Mark Durkan (Social Democratic and Labour Party, Foyle)

Surely my hon. Friend’s amendment would ensure that there was a clear third option for the consumer, which would be to say, “This provider of these particular goods, fittings and fixtures to my house has proved not to be fit for purpose, therefore I want to abandon that transaction and seek an alternative, rather than having to go with an unsatisfactory provider or take the difficult course of pursuing damages.”

Stella Creasy (Labour, Walthamstow)

In fairness to the Minister, I think she is trying to suggest that a consumer could go straight to seeking damages. The point we are trying to make is my hon. Friend the Member for Foyle’s point: might people, in some circumstances, just want to get their money back? Damages obviously imply a legal procedure. I urge the Minister to think about how it could be clearer that, where consumers will have that right, it will not be held against them in court that they have not gone to the trader and asked for a repair. There is confusion about the circumstance in which a right to repair is not a feasible option at all, because the cost of seeking damages is quite prohibitive. However, I am happy to withdraw the amendment for the moment. Perhaps we can return to the matter on Third Reading, and perhaps the Minister will reflect on the points we are making and consider whether there might be a way of amending the Bill to provide protection in the extreme circumstances when people lose walls. I beg to ask leave to withdraw the amendment.

Stella Creasy (Labour, Walthamstow)

I beg to move amendment 12, in clause 19, page 10, line 14, at end insert—

‘(6A) Where the trader has failed to notify the consumer of an outstanding legal charge or liability against the goods, in exercising the right to reject the consumer may also revert all legal and financial responsibility to the trader as though the initial transfer had not taken place.’.

I hope the amendment will get the Committee’s support, because it is simply a tidying amendment. Given that the Minister agreed with us about the importance of protecting people who buy a car with a charge on it, and protecting people from being sold something without knowing that there is a cost attached to it, I hope she will agree that the amendment is essentially a way of clarifying the matter. If somebody sold a car with a charge outstanding on it and did not tell the buyer about it, any liability would transfer back to the trader and not remain with the consumer.

The amendment would simply extend the right to reject as set out in the Bill. It clarifies who would retain that right in the unusual circumstances in which people are sold a car with a charge on it. I hope the Minister will accept that it links in with the points we made earlier on clause 17, which she accepted and said were covered in the Bill. The amendment would help to confirm that they are covered throughout the Bill.

Jennifer Willott (Liberal Democrat, Cardiff Central)

As the hon. Lady said, the amendment ties in with the issue of logbook loans and so on, which we discussed before the recess. I agree that it is important that consumers should have the confidence that when they buy goods, they do not have to worry about whether someone can lay claim to them. If such a claim exists, the consumer must be made aware of it before they make the decision to buy the goods. I completely agree that they should not be in a position where they find out about that later and it has an impact on them.

As we discussed earlier, the rights in question are encompassed in clause 17(2), which requires traders to disclose any outstanding charges or claims over the goods. The amendment is intended to give the consumer extra protection by stating explicitly that, when goods are rejected, responsibility in relation to those goods reverts to the seller. I want to make it clear that it is already the case that the seller does not cease to be responsible for unpaid charges by selling any goods that are subject to the charges. The seller is still liable to repay any loan secured on the goods. Selling the goods to a consumer does not affect that.

Andy McDonald (Labour, Middlesbrough)

But if the unwitting purchaser has taken possession of the goods through a bill of sale or logbook loan contract, there is nothing to prevent the person who has the benefit of that debt from coming and seizing those goods and circumventing the whole process. I am a little concerned about that. In the absence of anything else, will the Minister clarify how an unwitting purchaser may check out for themselves whether a vehicle, for example, is subject to a bill of sale? We understand that one in four second-hand car sales are conducted in that way.

Jennifer Willott (Liberal Democrat, Cardiff Central)

To be honest, I cannot answer the last point; that would be a matter for the Driver and Vehicle Licensing Agency. When purchasing an item—a car or whatever—the consumer has the right to purchase it free from charges, or at least to be told whether there are any outstanding issues. That is covered by clause 17(2). If a seller sells a car and does not disclose any charges, they are in breach of contract. If a consumer buys a good—a car, say—that is subject to a charge that is not disclosed to them, they have the right to claim damages from the seller. In that situation, the consumer can usually reject the goods so that they revert back to the seller. That is the situation under the current law. [ Interruption. ] I see confused faces.

Andy McDonald (Labour, Middlesbrough)

I do not think that that helps, because there is somebody stuck in the middle. They think they are acquiring goods, but those goods can be taken off them. I think the Minister is saying that, because that charge is properly enforced when someone sees the goods, the ultimate recipient of the goods can look to the person who sold them those goods for redress. Well, it is gone after that, is it not? It is too far down the track and leaves the consumer empty-handed. That point was not addressed in her comments.

Jennifer Willott (Liberal Democrat, Cardiff Central)

Someone selling goods must have ownership rights in the first place in order to sell them. If they do not, they will breach clause 17(2). A seller who sells a car that is subject to a charge without disclosing that to the purchaser will breach the law. The purchaser will be able to claim damages for breach of contract under clause 17. There will be a right of redress for the purchaser, because the seller will be in breach of the law. I hope that that clarifies matters.

The hon. Member for Walthamstow may raise any other issues in her remarks, but I ask her to withdraw the amendment, because it is already the case that the seller does not cease to be responsible for any unpaid charges. What the amendment is intended to do is already covered by the law.

Stella Creasy (Labour, Walthamstow)

I thank the Minister for her answer, but I am not sure that she quite understands how the bill of sale amendments affect the issue and why we think the tidying amendment is required. There is a difference between the goods themselves—the car—and any outstanding charge. The challenge that we are trying to deal with here and in our previous amendment is what happens when both are applied to the consumer. It is about when a consumer unknowingly buys a car with an outstanding charge and then become aware of the charge, usually because someone tries to repossess the car.

The Minister has assured us that, under clause 17(2), the trader will have to tell someone that there is an outstanding charge. With the amendment, we are trying to ensure that both functions of a bill of sale agreement go back to the trader. People can sell cars with outstanding charges, and the person buying the car will still lose the goods and be liable for the fact that they have lost those goods. We are trying to tidy up both the charge and the car sale, so that a purchaser has both the right to reject the goods, because they did not know that they would be liable for the cost, and the right not to be liable for any of the outstanding charges.

One of the problems has been that companies have sought redress for both the cost of the car and the cost of the loan from owners of a car that has been bought without knowledge of the charge.

Jennifer Willott (Liberal Democrat, Cardiff Central)

Let me clarify. If someone purchases a car that has an outstanding charge, they are not liable for that charge. The liability remains with the person who took out the loan. The ownership or responsibility for the charge is not transferred; that rests with the individual. Purchasers have the right to reject if they discover that the seller did not have the right to sell the car—not having ownership of it, for example. My understanding is that that right is not limited to 30 days, because the purchaser bought something from someone who did not have the right to sell. Therefore there is already quite a bit of protection built in.

Another issue that the hon. Lady raised was the ability to identify charges and to know whether there is an outstanding charge on a vehicle. The majority of logbook lenders now voluntarily register the charge on a searchable asset finance database. It is an industry requirement under the code of conduct enforced by the Financial Conduct Authority, and that should be available for people to check.

Stella Creasy (Labour, Walthamstow)

I bought a second-hand car recently, and I have not searched that database because it is not something one would necessarily do as a matter of course. One of the reasons why we tabled amendment 17 was to ensure that any such information would be provided to the purchaser at the point of purchase.

Jennifer Willott (Liberal Democrat, Cardiff Central)

It has to be.

Stella Creasy (Labour, Walthamstow)

I am glad that the Minister says it has to be, because that was not clear in the legislation, which we sought to ensure people were aware of.

All that amendment 19 tries to do is ensure that, if there is a loan outstanding on a car and the borrower has disappeared, the purchaser is not liable for any costs against the car. I think that the Minister is trying to resist making explicit something that she says is implicit. I am little confused as to why we would not want to be crystal clear, given that we all understood that there is a problem with that particular type of credit and contract, and to make it explicit that any of those rights and concerns would also revert to the trader.

Jennifer Willott (Liberal Democrat, Cardiff Central)

I am happy to make it crystal clear that the purchaser does not take on responsibility for the charges. The charges rest with the seller, and it is also a requirement that they be disclosed, under clause 17(2), to anybody who is purchasing.

Stella Creasy (Labour, Walthamstow)

I thank the Minister for that. For the record, can she confirm that, for example, the consumer would not have to pay to retrieve the car? We talked during our previous sitting about a Rolls-Royce, a particularly valuable car, that turns out to have a charge against it. Can she confirm that, if someone discovered that it had a charge against it and wanted to get it back, they would not be liable for any of the costs of recovering the car from a lender who had taken it back? We are talking about any liability for charges arising from those types of loan to a consumer.

Jennifer Willott (Liberal Democrat, Cardiff Central)

To clarify, my understanding is that in any circumstances in which someone purchases a car, however valuable it might be, from someone not fully entitled to sell it, they have the right to claim damages from the trader for the associated costs, because the trader did not have the right to sell it. If the trader did not have full ownership, the purchaser has the right to claim damages against them.

Stella Creasy (Labour, Walthamstow)

Citizens Advice recently said that one in the five of the people it had dealt with involved in logbook loans had a car repossessed, despite the fact that the owner was not the original borrower. Anybody stuck in that position would be disappointed to have to go to court to get their money back for recovering the car.

Given that the Minister was so positive earlier about the importance of tackling this issue for consumers who unknowingly buy a vehicle with such a charge against it, I encourage her to ensure from start to finish that it is not a nightmare for consumers and that we do everything to tidy up the legislation. That is what we were trying to do, and if she has a better way of doing it, we will be happy to support it on Report. I will withdraw the amendment for the moment, but I encourage the Minister to reconsider. I am not sure she fully understands how vicious such companies are and what it means to some of the consumers involved. I beg to ask leave to withdraw the amendment.

Stella Creasy (Labour, Walthamstow)

I beg to move amendment 10, in clause 19, page 11, line 5, at end add—

‘(16) Upon seeking to enforce statutory rights under this section, customers must be provided with information, by the trader, about their rights regarding rejection, repair or replacement of goods, or other remedies provided under sections 20 to 29 of this Act.’.

Sandra Osborne (Labour, Ayr, Carrick and Cumnock)

With this it will be convenient to discuss amendment 31, in clause 36, page 23, line 40, at end insert—

‘(1B) Prior to exchange of the digital content or agreeing the contract, whichever happens first, the trader will explicitly provide the consumer with relevant details of their statutory rights under sections 42, 43, 44 and 45 of this Act.’.

Stella Creasy (Labour, Walthamstow)

Amendment 10 is probably the most substantive of this group, because it goes to the heart of some of the debates we have just been having. It feels a bit like we have been looking at the cart, rather than the horse. We have talked previously in this Committee about what rights people have to a particular good and whether it should be fit for purpose and satisfactory. This amendment is concerned with what they can do, and how they can know what to do, when things go wrong. We have already discussed the number of requirements that could be made concerning repairs or refunds.

The amendment is about ensuring that consumers have those options in front of them at the point at which they seek redress, so that they do not falsely seek a redress that is not available—different forms of redress are set out in the legislation—and know what remedies they are entitled to. During our morning sitting on 13 February, we discussed the importance of information at the point of sale. It is important for consumers to be told not simply that they have statutory rights but what those statutory rights are, so that if someone buys a jumper and discovers that it has a hole in it, they can take it back, knowing that they have a right to a jumper without holes in it—unless it is the fashion, obviously.

The amendment deals with the other side of that—with the point of complaint. If someone discovers that their jumper has a hole in it when they get it home, not having seen it in the shop, what rights do they have to complain and what remedies are they entitled to secure? I want this to be a therapy session, in a way, because our personal experience is often the most important way to understand the frustration of our constituents and the fact that we must get the legislation right in order to address it. After all—I say this as a psychologist—complaining is awful. Nobody likes complaining; nobody likes conflict. People steel themselves to go into a shop to say, “Actually, this isn’t right.” If we get the legislation right, that process will be made a lot easier, and I am sure that people will be a lot happier, or at least less distressed by the experience of trying to exercise their rights.

What do people do when they complain? They go in and say, “You have broken a contract with me. You were supposed to sell me a jumper that was perfect, and in fact you haven’t. I now seek redress from you for the fact that this jumper is not perfect.” That is, as I say, in itself conflict, which is awful and difficult for people to deal with. Imagine if the sales person disputes that. Imagine the embarrassment. I am sure we are all familiar with our “stiff upper lip” and the awkwardness of having to argue with somebody in a shop about whether a good is appropriate, satisfactory or fit for purpose. We talked during that sitting about buying bin liners to keep dry in a storm because the sales person had said that they were waterproof, discovering that they are not, then going dripping, sopping wet, into the shop to say, “You sold me bin liners; they are not fit for purpose. I want my money back.” If the sales person says, “Well, you can’t have it,” what do we do then?

All of us have experienced trying to complain about something and finding that, whatever argument we make, the sales person—who is perhaps what might be termed a “computer says no” person—believes that we were not sold a faulty good and therefore will not give us the money back or repair the good. Indeed, they will say that we do not have the right to repair it. This amendment would make it clear, at that point, that a person should have information about exactly what they can and cannot complain about.

Andy McDonald (Labour, Middlesbrough)

I wonder what my hon. Friend would make of the following scenario. Someone’s mobile phone does not function and is not fit for purpose but, when they attempt to reject the good and say to the mobile phone company that they would like a replacement, they are told, “You haven’t paid for anything. We gave that to you—it was bundled in with the contract you purchased.” Does the Bill go any way towards addressing that dilemma?

Stella Creasy (Labour, Walthamstow)

I fear that my hon. Friend may be speaking from bitter experience and frustration. That is, in a way, what we are seeking to get at with this amendment: how can we make it clear for both parties what can be complained about, what their rights are and what is not a fair complaint? Martin Lewis, when he gave evidence to the Committee, talked about people thinking they can take back a good that they believe is faulty when actually they cannot, because they accepted it was faulty when they bought it, because they were told about the fault in advance. Or, they buy a jumper knowing that there is a hole in it, but then discover a stain as well. It is a question of knowing what one’s rights are.

Since that sitting of our Committee, I have done some original research and discovered that it is not clear to a number of people on the shop floor what is or is not fair. They believe that if a person buys a good with a fault, it is sold as seen, faulty, and they should not have a right to complain about it. It is an entirely honest mistake for them to make. One of the things that we recognise about this legislation is that, in clarifying not just what rights a person has but also what remedies, that process of complaining should be simpler and it should be easier to say to shop assistants that, even though they bought a jumper with a hole in, the fact that it also has a stain means that they can return it.

That can only happen if, at that point of complaint—as with the point of sale—there is clear and accurate information, so that a person can say, “Actually, it is not just that I have the right to complain about this; here is what that right looks like.” That is all the more important in legislation that establishes a chain of events for the different processes of rejecting goods over a short period, of requiring repairs and, ultimately, of seeking a refund. Some consumers might seek an immediate refund, some might ask for a replacement and some might ask for a repair. Such variation can happen under the legislation, but we are trying to make sure that, at the point at which a person seeks to exercise those rights, they have the information on what is possible. That would not just protect the consumer but would protect shop traders from making an error of judgment, or voiding someone’s rights by challenging them.

It is also important to recognise that people will be entitled to different remedies, so it is right to set those out at the point when they might seek to exercise them. That is why Citizens Advice and Martin Lewis have raised this issue. They are very supportive of such a measure. Martin Lewis told us that he has a piece of paper in his wallet that sets out his current rights to remedy, which he brings out. I am sure that the look of terror on the shop trader’s face when Martin Lewis walks in holding a bag containing something he previously bought is a sight to see. What we all want is for such situations—that potential conflict—to be resolved speedily, correctly and in the interests of the consumer. Information is at the heart of that transaction and of making sure that people get the appropriate remedy at the right time.

This amendment would require that such information be set out at that point of complaint, so that neither party can dispute it and they can both get on with resolving the issue. There is a simple test at the heart of this amendment: do we think that people should know their remedies as well as their rights? We want people to know their statutory rights, and we hope we can later convince the Committee to make sure that that comes at the point of sale. People should also know their remedies, and that should come at the point of complaint.

I hope members of the Committee will support the amendment, and perhaps share their stories of times when they tried to complain, and say whether they think that process is as simple and fair as they would wish it to be.

Sheila Gilmore (Labour, Edinburgh East)

This is an important issue. I am concerned that there have been suggestions that it would be too difficult to provide this information, and too onerous for retailers if we put extra burdens on them. For many years people have probably had some idea of what they could do, when they could do it and what their rights were. They perhaps picked it up from previous experience, talking to others or from what they had seen on television programmes, but that information is not as good as it can be and people often get it wrong. They either get it wrong and do not claim what they should, or in some circumstances, they might think their rights are greater than they actually are.

Probably for a lot of retailers—particularly the small ones or shops where staff are not well trained—people just say things which they think are right. So if someone goes into a shop to make a complaint, the person there says: “Oh, no, you cannot do that. It is not right. It is too late. You bought it in the sale”, or whatever. Many people will accept that because whether it is right or wrong—and in some cases it might be right—they will feel that the retailers should, of course, know. They have tried to make their complaint, they have done their bit, they will simply go away and grumble and feel there is nothing they can do.

Stephen Doughty (Labour, Cardiff South and Penarth)

My hon. Friend is absolutely right. In some cases it can get to more extreme circumstances and some quite unpleasant exchanges. I recall a restaurant I visited some time ago—I will not say which town it was in—when I was unhappy with the quality of the food and service. When I complained to the owner of the restaurant and the chef, the response was that I could “bleep” off out of the restaurant and that I had no rights at all. Obviously, I did not want to escalate that situation any further, as I am sure you would understand, Ms Osborne, and it is key that we have information on both sides in these situations.

Sheila Gilmore (Labour, Edinburgh East)

That is a good example of the situation that people can find themselves in. In a lot of consumer purchases, particularly the small ones, the effort of going to check up, find out, get advice and take further action feels disproportionate. Probably if we are buying something relatively substantial we will pursue it more than on other occasions, because if someone pays £300, £400, £500 for a fridge-freezer or whatever, they will feel quite strongly—perhaps strongly enough to then get proper advice.

Many of our purchases are relatively small, but that does not mean they are not important. However, in terms of whether to go to a lot of effort to check out whether the shop was right or my vague feeling that I was right was right, people just will not do it. All of us have done this sometimes, even those of us who think we are strong consumers. We get to the point of thinking: “I will just put up with it”.

Andy McDonald (Labour, Middlesbrough)

Does my hon. Friend agree that these conversations are often characterised by a trader setting out to deny customers their existing statutory rights by coming up with alternative solutions or other remedies that fall way short of existing statutory rights? Would it not at a stroke put this issue on a better footing if there was an obligation there and then to make it abundantly clear what those rights were?

Sheila Gilmore (Labour, Edinburgh East)

The example that comes to mind is of people who seek to get a refund or to return goods and are told, as they probably still are these days, “We will give you a credit note, so you have to come back to our shop and buy something here.” People might not want to do that, although in some cases it might be a perfectly acceptable choice. Often, with a one-off purchase, people would rather go elsewhere. Apart from being a bit disillusioned with whomever they purchased the item from, anything else that the shop has to offer is not necessarily similar.

I am not a great shopper. Here I am on the Consumer Rights Bill Committee, although I do not enjoy shopping at all, unless it is in a bookshop, which is different. I can get lost in a bookshop. Unusually, however, I bought a dress last week, which was an impulse purchase, because I was hurrying past a shop and thought, “Oh, I quite like that.” Nevertheless, with such a purchase, that particular shop did not have lots of other things that especially appealed. I have not worn the dress properly so far, but if it were faulty, I would not want a credit note—I would not want to buy anything else there, because I was not particularly interested in anything else the shop was selling.

Such practices still go on and people do not know their rights exactly. Why should they? We do not all go away and study such things. I was impressed by some of the work done by Citizens Advice on how to present the information relatively simply and in a straightforward way. It has put quite a lot of work and effort into that, because it is often one of the organisations to which people go. Citizens advice bureaux no doubt find themselves telling people over and over again—different people, I hope—the same sorts of things, some of which can be fairly basic. If such things were clear from the outset, people would not have to go down that road and to seek such advice. It is possible. We should be prepared to take up the kind of presentation that has been suggested by an organisation that has a lot of experience in this field. We should be prepared to close that circle in terms of consumer rights, and it could be done in a fairly straightforward way. Having reflected on the evidence and the briefings, I hope that the Minister will be prepared to accept the point and to amend the Bill appropriately.

Jennifer Willott (Liberal Democrat, Cardiff Central)

The amendments also relate to one of the debates that we had in the week before recess, as the hon. Member for Walthamstow said. Amendment 10 would require the trader to make consumers aware of the statutory remedies available to them when their statutory rights have been breached, rather than at point of sale, as we discussed before. Amendment 31 corresponds to amendment 6, which sought to amend clause 11 and which we discussed in a previous sitting in relation specifically to goods.

As I said when we discussed the measures to do with the information that should be provided to consumers, the Government are completely committed to ensuring that consumers and traders are better informed about their rights and obligations. Good examples have also been given today about how important it is for people to know their rights and the remedies available to them. Part of the purpose of the Bill is to simplify the rules and to make it easier for consumers and businesses to understand the rights, remedies and obligations on both sides, so that the law can be implemented as effectively as possible. The information is a critical part of ensuring that the Bill works and achieves our objectives.

The Government have also passed legislation that requires traders to remind consumers that it is their right that goods conform to the sales contract. That reminder must be given before consumers are bound by a contract. That is required by the consumer contracts regulations, which I have mentioned a number of times and will probably carry on mentioning in the future during the passage of the Bill. The provision of excellent consumer information about rights and remedies is critical to making the system work, which is why we set up the implementation group, which I mentioned earlier. It is already considering whether the provision of mandatory information at point of sale would be valuable and whether consumers are more likely to absorb information about their rights when a problem has arisen and they need specific advice. It is also looking at the different ways that people can access information at different points during purchasing.

We are not saying that point of sale is the wrong time to provide information. It may well be the right time to provide some information, but there are arguments against providing too much information at the point of sale. It might therefore be more appropriate to provide the information when it is required, which amendment 19 seeks to do. Both options have equal merit and both options are being considered by the implementation group. We all know that consumers rarely read all the information provided to them when they enter into a purchase. For example, PC Pitstop once had a clause in its end-user licence agreement that anyone reading that clause could claim a $1,000 prize. It took four months for anyone to claim the prize. No one read the clause for four months, which shows that if we provide too much information, people switch off. Information that is not directly relevant to the consumer at the point of sale is likely, at best, to be skimmed over, if read at all.

Andy McDonald (Labour, Middlesbrough)

I do not know whether the Minister will go on to develop the point further, but is she really suggesting that when someone thinks their statutory rights have been infringed, to be simply told what they are—reject, repair, replacement or refund—is too much for a consumer to absorb? It is a simple statement.

Jennifer Willott (Liberal Democrat, Cardiff Central)

No, that is absolutely not what I said. I said that we have to ensure that the information people get is easily accessible and at the right time. Some of it might be at the point of sale, which we discussed before, but the amendment is about when someone’s statutory rights have been breached. Consumers may need information at that point as well. People may well need different information at different times, so it is important to ensure that the information available at different points in the process is the information that consumers and businesses need at that time. We know from lots of research that if people receive too much information at any one point, they do not absorb it or they do not read it. Just giving people vast swathes of information at the time of purchase does not necessarily mean that they take it on board and realise what their rights are. We need to ensure that the information they are given is in the right format, easily accessible and given at the right time to ensure they can access it.

Fiona O'Donnell (Labour, East Lothian)

I apologise for my absence during parts of the debate, Mrs Osborne. I had an important Select Committee meeting elsewhere. May I probe the Minister about the information, because it is important? A consumer who when returning goods to a shop, for a refund, exchange or whatever, was told something by the person dealing with them could ask that person to produce the relevant consumer information that shows what the retailer has a right to do and what the consumer’s rights are. I would find that very useful.

Jennifer Willott (Liberal Democrat, Cardiff Central)

All of that is being considered by the implementation group. What will make the legislation work is consumers knowing what their rights are and what remedies are available to them and businesses knowing what their obligations are. A critical part of that is ensuring that everyone has the information they need at the appropriate time, and the implementation group is looking at that. It has consumer organisations—Citizens Advice, Which?, moneysavingexpert.com—but it also has business organisations, such as the CBI, the FSB, the British Retail Consortium.

The implementation group is considering how to ensure that people have access to the information they need, at the point they need it. There may be different ways to access information for different people. Some people might find an app extremely helpful, but for others the idea of taking out a smart phone in a shop and looking something up is on a totally different planet. The group is looking at the different ways of ensuring that consumers are confident in knowing their rights and the remedies, and at bringing together all the people who are part of the contract.

Fiona O'Donnell (Labour, East Lothian)

Can the Minister confirm that the Bill will also apply in the public sector, or is it only the private sector?

Jennifer Willott (Liberal Democrat, Cardiff Central)

The Bill relates to transactions in which someone is purchasing a good, service or digital content from a business or trader. There are no such transactions in the public sector because there is no commercial relationship between the individual provider and the consumer. The Bill will apply where there is a relationship between a business and a consumer.

Everything is being considered by the implementation group. As we discussed in the previous sitting when we talked about point of sale information, my concern is that it would be unhelpful to introduce a requirement in the Bill on exactly what information should be provided at a given point. There are ongoing discussions between consumer groups and business umbrella organisations on the most effective ways to provide information, on the information that should be provided and on when information should be provided. The Government continue to work on that to ensure that the information provided is as effective as possible.

Andy McDonald (Labour, Middlesbrough)

The Minister is being extremely generous in giving way, but my concern is that we seem to be abrogating our responsibilities and giving them to an implementation group to do something that is not particularly complicated. Martin Lewis presented the Committee with people’s legal rights in a straightforward and simple format. If we can agree that we want to communicate to consumers exactly what their consumer rights are, there is a simple response. Does it really need to be kicked into the long grass of an implementation group when we can do it through this amendment here and now?

Jennifer Willott (Liberal Democrat, Cardiff Central)

Martin Lewis gave excellent evidence to the Committee, which is one of the reasons why his organisation, MoneySavingExpert, is on the implementation group. I completely disagree that it is being kicked into the long grass, because one of the reasons for running the implementation group in parallel with the passage of the Bill is to ensure that all the background and preparatory work is done so that it can be implemented as soon as possible after the Bill is enacted in whatever amended form it takes. Kicking it into the long grass would mean not even starting the planning until afterwards.

We are trying to ensure that the work is done in a timely way in parallel with the passage of the Bill so that we can make sure that businesses have the information that they need ahead of the Bill’s implementation. Hopefully businesses will be in a position from day one of knowing their new obligations and the new consumer rights so that they can be enforced as soon as possible.

It would be wrong to assume that we know exactly the ins and outs of how best to provide information to consumers and businesses, which is my concern about including it in the Bill. The whole point of the implementation group is that we have people who know the ins and outs, both from a business and a consumer perspective, and are able to consider in depth the best way to put across the message and the best timing to ensure that businesses know their obligations and what they have to provide to consumers, and that consumers know their rights and the available remedies. That is much more complex than it seems, because we also need to ensure that businesses know what they have to provide so that they are in a position to apply it from day one.

It is right that we ensure that the people who really know what they are talking about get together to identify the best way of providing that information. My concern is that putting that in the Bill is too prescriptive. It is better to work with the organisations that know what they are doing to ensure—[Interruption.] I am sure the hon. Member for Middlesbrough knows exactly what he is doing, and I am sure he has some valuable contributions to make to the implementation group, but prescribing it in the Bill is the wrong approach. I ask the hon. Member for Walthamstow to withdraw her amendment.

Stella Creasy (Labour, Walthamstow)

I thank the Minister for her response. I agree with 90% of what she says. It is important that we have this information, and it is right that we consider when people access the information. The one fatal flaw in her argument is that the Bill does not actually require traders to provide the information. She argues that we need to get right how that information is implemented and get it in the right format. I have to question whether an app is the appropriate way to do that. If there is no wi-fi or there is not a good signal in the place where you are trying to access that information, that would be a problem.

Jennifer Willott (Liberal Democrat, Cardiff Central)

Absolutely.

Stella Creasy (Labour, Walthamstow)

However, the fundamental principle that we should have the information is not included in the Bill. There is no requirement in the Bill for a trader, either at the point of sale or a point of complaint, to tell consumers what their rights or remedies are. The implementation group is looking at implementing something that will be guidance at best, rather than a reality. We all know what will happen. The good traders will have that information and will say, “It is probably in our interest to give our shop staff clarity about what they can and cannot say to people, so that we do not have a scene”—that awful complaining moment that we talked about earlier. The bad traders will do no such thing. We know that the bad traders will dispute what is satisfactory and what remedies are available to people because the Bill in its current state does not actually contain anything to be implemented.

This amendment sets out the remedies, in the same way as the amendment to require information to be provided at a point of sale. They are very clearly set out in clauses 20 and 29 and we are simply making sure that that information is required to be provided. It makes absolute sense to leave it to the implementation group to decide how that is done, but if they do not have anything to implement, what are they working on? That is what we are concerned about, because it is no good giving consumers a right if they do not have a practical way to exercise it. It is no good saying, “We expect a trader to know what they can and cannot tell a consumer” and not recognise that that puts the balance of interest firmly with the trader rather than making it an equal process.

The amendment, like our previous amendment about point of sale information, would create a basic platform about what information people should have at the point at which they complain about what remedies they are entitled to. How that is done, be it through an app, a sign in the shop, or a written card such as the card that Martin Lewis pulled out of his wallet, is open to the implementation group, but surely we should give them the confidence that we recognise that the work that they are doing is so important that we want to implement it as a standard, not an additional service, which is what could happen here.

I very much take my hon. Friend the Member for East Lothian’s point about the public sector. The measure applies to the public sector because clause 2 very clearly states:

“‘Business’ includes the activities of any government department or local or public authority”.

The Committee will come on to discuss issues around the public sector and local authorities.

People’s rights to redress and to remedies are paramount in their ability to secure a positive outcome. People must be entitled to information at a critical juncture, because most people are not like my father, who stockpiled copies of Which? when I was a child. I grew up in a household with hundreds of those magazines around, and I lived in fear of my father finding something wrong with something because I knew he would argue his case. We did well when I was a child: we did not have a faulty freezer, I can tell the Committee that much. It should not just happen because a consumer is prepped. At the point when the consumer makes the decision to complain, the conversation should be a clear one, informed by evidence and information. There is no point in our having an implementation group if that is going to vary, not about how people access that information, but about whether they are given it at all. So I am sorry, but we do not accept the Minister’s case.

Fiona O'Donnell (Labour, East Lothian)

My hon. Friend is making a very powerful case, to which I hope the Minister is listening. Consumers are at risk here of still facing businesses or retailers who say to them, “I cannot refund your money because the original packaging is not there.” Consumers will not necessarily have the right and the retailer will not feel the need, under guidance, to provide that information and the back-up for that kind of removal of someone’s rights.

Stella Creasy (Labour, Walthamstow)

I absolutely agree with my hon. Friend and I call for a Division on the amendment.

Clause 20 - Right to reject

Stella Creasy (Labour, Walthamstow)

I beg to move amendment 13, in clause 20, page 11, line 24, at end insert—

‘(a) within 30 days of agreeing that a refund is to be paid, and

(b) using the same payment method used in the original transfer.

‘(9A) Where the trader fails to ensure an entitled refund under subsection (9) is provided within 30 days, the consumer is entitled to seek damages from the trader commensurate with the impact of any loss caused by this delay, unless the consumer has decided to waive this right to a refund within this timeframe.’.

Sir David Amess (Conservative, Southend West)

With this it will be convenient to discuss the following:

Amendment 14, in clause 20, page 11, line 27, after ‘transferred’, insert

‘within 30 days of agreeing that a refund is to be provided’.

Amendment 15, in clause 20, page 11, line 27, at end insert—

‘(10A) Where a trader fails to ensure an entitled transfer under subsection (10) is provided within 30 days the consumer is entitled to seek damages from the trader commensurate with the impact of any loss caused by this delay.

(10B) Damages shall not be awarded if—

(a) the consumer has decided to waive this right to a return of whatever was transferred within this timeframe, or;

(b) such a timeframe could not be considered reasonable given the transfer in question.’.

Amendment 16, in clause 20, page 11, line 31, after ‘transferred’, insert

‘within 30 days of agreeing that a refund is to be provided.

‘(11A) Where a trader fails to ensure an entitled transfer under subsection (11) is provided within 30 days the consumer is entitled to seek damages from the trader commensurate with the impact of any loss of income from this delay on them.

(11B) Damages shall not be awarded if—

(a) the consumer has decided to waive this right to a return of whatever was transferred within this timeframe, or;

(b) such a timeframe could not be considered reasonable given the transfer in question.’.

Amendment 17, in clause 20, page 11, line 34, at end insert—

‘(12A) Any refund under subsection (12) shall be paid—

(a) within 30 days of agreeing that such a refund is to be provided, and

(b) using the same format for payment used in the original transfer for which they are receiving the refund.

(12B) Where the trader fails to ensure an entitled refund under subsection (12) is provided within 30 days the consumer is entitled to seek damages from the trader commensurate with the impact of any loss caused by this delay.

(12C) Damages shall not be awarded if—

(a) the consumer has decided to waive this right to a return of whatever was transferred within this timeframe, or

(b) such a timeframe could not be considered reasonable given the transfer in question.’.

Amendment 18, in clause 20, page 11, line 37, at end insert—

‘(13A) Any refund under subsection (13) shall be paid—

(a) within 30 days of agreeing that such a refund is to be provided, and

(b) using the same format for payment used in the original transfer for which they are receiving the refund.

(13B) Where a trader fails to ensure an entitled refund under subsection (13) is provided within 30 days the consumer is entitled to seek damages from the trader commensurate with the impact of any loss caused by this delay on them, unless the consumer has decided to waive this right to a return of whatever was transferred within this timeframe.’.

Amendment 24, in clause 24, page 14, line 39, after ‘amount’, insert ‘, to be paid—

(i) within 30 days of agreeing that a refund is to be paid, and

(ii) using the same payment method used in the original transfer for which they are receiving the refund.

‘(1A) Where the trader fails to ensure this refund is provided within this timeframe the consumer is entitled to seek damages from the trader commensurate with the impact of any loss caused by this delay, unless the consumer has decided to waive this right to a refund within this timeframe.’.

Amendment 36, in clause 45, page 28, line 8, at end insert—

‘(2A) The consumer is entitled to this refund within 30 days of agreeing that a refund is to be paid using the same payment format used to purchase the digital content for which they are receiving the refund.

(2B) Where the trader fails to ensure this refund is provided within this timeframe the consumer is entitled to seek damages from the trader commensurate with the impact of any loss of income from this delay on them unless the consumer has decided to waive this right to a refund within this timeframe.’.

Amendment 37, in clause 46, page 28, line 22, at end insert—

‘(2A) The consumer is entitled to this payment within 30 days of agreeing that a payment is to be made using the same payment method used to purchase the digital content for which they are receiving the payment.

(2B) Where the trader fails to ensure this payment is provided within this timeframe the consumer is entitled to seek damages from the trader commensurate with the impact of any loss of income from this delay on them unless the consumer has decided to waive this right to a payment within this timeframe.’.

Stella Creasy (Labour, Walthamstow)

Welcome, Mr Amess. This morning was like a therapy session for many of us who have experienced frustrations in our consumer practice.

Brooks Newmark (Conservative, Braintree)

Speak for yourself.

Stella Creasy (Labour, Walthamstow)

I certainly felt I got a lot out of getting it off my chest, and I am sure that this afternoon will be no different. I hope, Mr Amess, that you will enjoy hearing our first-hand experiences of some of the problems that consumers have. It is with that in mind that we have tabled the amendments.

Clause 20 concerns the right to reject. A point for all of us to agree on is that if someone has been sold something faulty, they ought to be able to reject it and say, “It is not good enough, I want my money back”. The amendments say that it is an absolute right to be able to reject something and say, “It is not good enough, it has broken the terms and conditions by which I bought it, it is not satisfactory or fit for purpose, I would like my money back and I should not have to wait to get it”. We would hope that that is a simple proposition for the Committee.

The clause sets out a number of conditions under which a person could get their money back and reject a good. Our amendments mirror those various conditions. For example, when somebody has paid for something outright, we set out the point at which they should get their money back. When they have paid for something via an exchange, we set out what they might get back in that instance. We also provide for what happens when somebody has paid for part of an agreement through another form of payment—for example, if they have paid for something as part of a contract but want to reject the whole contract. The amendments cover a range of activities.

The Government have placed great store on making consumer rights simple in the Bill and making them really clear for people to remember. I am sorry, Mr Amess, that you missed our conversation this morning about remedies. I think that you were here for the sitting when we talked about point-of-sale information. It seems to us that the Government’s simple proposition is that people should be able to remember all their rights, and therefore they do not need to be told them at the point at which they might want to exercise them. In order for them to be memorable, they clearly have to be consistent. The Bill sets out a 30-day limit in which someone can exercise their short-term right to reject.

Let us return to our jumper with a hole in it. If we identify that there is a hole, we have 30 days to return it. That is a fairly simple rule. Even I could remember that, I think. We are trying, through our amendments, to ensure that people do not have to wait an unspecified to time to get their money back. We do not think that is fair, especially in a day and age when people can spend money instantaneously. All of us rue the times, perhaps late at night, when we have been on Amazon, seen 1-Click and suddenly found that we have bought something. Instantaneously, that money has gone from our accounts. We think that just as quickly as money can be taken from us by a trader, it should be returned.

There are some instances in which there might be delays in money coming back to people. We heard in the evidence given to us by the British Retail Consortium, which, I stress, said it was happy with the idea of a 30-day period for money to be refunded, that there might be issues to do with the bank payment system. Those of us who have ever used a bank payment system to pay credit cards, for example, will know that that can be very quick. The money can definitely be gone quickly, so it is possible to do. We do not see why consumers should have such clear short-term rights to reject things but such undefined rights about getting their own money back.

The amendments are about ensuring, in all the different instances in which somebody might exercise the right to reject, that they are able to recoup their money in a time period that is similarly easy to remember. If someone was not getting their money back, they would have a right to go to the trader and say, “Hang on a minute, if you can take the money so quickly, you should be able to return it.”

Stephen Doughty (Labour, Cardiff South and Penarth)

My hon. Friend raises a crucial point that many of my constituents have raised with me recently, particularly the issue of direct debit payments for products and the slow speed at which payment is returned. The money is quickly taken out of accounts—large amounts over a number of months—but often for products that are not delivered, or not delivered to the customer’s satisfaction. I experienced that recently with EE, which took ages to pay me back for a product that was not working and was not satisfactory.

Stella Creasy (Labour, Walthamstow)

My hon. Friend makes the case very well. It does not make sense to us in this day and age, especially when people pay so quickly online, that it can take so long for money to be returned to people. That can have serious consequences for people who might have paid a substantial sum of money for a good. If they have to wait several months for their money back while it is processed, as I have waited for a refund in the past, that can be a financial disadvantage to them.

The amendment takes the spirit of the Bill—making consumer rights simple—and applies that simplicity to the concept of a refund. We wanted to test that in the evidence sessions. As I have already said, the British Retail Consortium said that it was happy with the idea. The Federation of Small Businesses said:

“I think we have no problem at all with the 30-day limit. As we have said before, it should not be causing any problems at all to our members. Most of our members would in any case try to keep their customers happy in as short a time as possible. The last thing we want is for consumers to have a bad experience, whether it is with tradesmen, retailers or any other sector. So we do not see too much of a problem with that 30-day period.”––[Official Report, Consumer Rights Public Bill Committee, 11 February 2014; c. 33, Q69.]

So we should all expect our money back much sooner than 30 days, but because of the similarities and the parallels with other rights in the Bill, it makes sense to provide that time frame and to recognise that there might be some delays that account for one or two weeks of processing, if an accounts department has to be involved or if paperwork has to be involved—perish the thought; how very 20th century. Nevertheless, 30 days seems a fair amount of time for someone to remember that they are entitled to their money back. We should have the confidence to put that time frame into the Bill and make it clear to people that if for any reason a trader is delaying refunding them, they have a right of redress. They have a right to say, “I should have compensation, because of the consequences for me of not getting my money back within a month.”

The various amendments reflect the different scenarios in which there is a refund entitlement under the Bill. We have tried to accommodate different types of refunds. For example, someone might be returning a car. A part exchange on a car might be an instance where it takes longer to return something, compared with an instantaneous bank credit, which we all know can be done, although it often is not done. We nevertheless think that even in such scenarios, 30 days is still a reasonable amount of time to wait.

We have included a proviso in some of the amendments that a trader and a consumer can waive the 30-day limit if there is a particular reason why it might take a long time to recoup a good or a payment, so there is some flexibility in the amendments. Without them, we are concerned that consumers might come to know and indeed love the idea that they have 30 days to return something, but be extremely confused about how long they must wait for the return of their own cash. By accepting the amendments, the Committee can take that spirit of simplicity and apply it across the piece. Even if consumers are not necessarily provided with the full details of their rights or remedies at the point of sale or the point of complaint, 30 is a number that will stick in their heads.

Fiona O'Donnell (East Lothian) (Lab) rose—

Sir David Amess (Conservative, Southend West)

I call the Minister.

Fiona O'Donnell rose—

Sir David Amess (Conservative, Southend West)

I am sorry. I apologise, Minister. I did not see the hon. Lady rising.

Fiona O'Donnell (Labour, East Lothian)

My arthritic knees are playing havoc with my ability to contribute to the debate. You are definitely not responsible for those, Mr Amess. Thank you for giving me the opportunity to contribute to the debate, and I thank the Minister as well for understanding.

I want to reinforce what my hon. Friend the Member for Walthamstow said. The clearer we make consumer rights, the easier it will be for people to exercise them. On the other side of the contract, it is important that there is clarity for traders as well, so that they understand their responsibilities. I expect all of us will have personal experiences that relate to the Bill, and although none of us would abuse your time, Mr Amess, or the Committee’s by using this as a therapy session, as it was called earlier, many of us have had the experience of returning faulty goods and then having to wait an inordinate time before the money is refunded. When the faulty goods are essential items such as white goods, that can cause real inconvenience for people who do not have the resources to replace the product in the meantime.

Will the Minister indicate what the consumer’s rights will be when there is a credit agreement in place on an item? If someone has entered into a credit agreement with the provider of the goods, how will that be handled under the Bill? It is disappointing that at various points, the Minister seems to have left it to guidance to spell out consumers’ exact rights. We already have many experiences from this Parliament of when flexibility in guidance has meant that consumers’ rights are not enforced.

Andy McDonald (Labour, Middlesbrough)

Does my hon. Friend agree that the amendments are mercifully simple? They have also met with the approval of a range of bodies, including Citizens Advice, the British Retail Consortium and the Federation of Small Businesses, so there appears to be an attraction to the simple approach of a 30-day payback period, which can be readily understood. Does she agree that that is to be welcomed?

Fiona O'Donnell (Labour, East Lothian)

Indeed it is, and I hope that the Minister will welcome it to give us broad consensus about the roles that people play in the engagement between suppliers and consumers. There is a lot of acceptance that we can simplify the rights of the consumer and those of the person providing the goods or service, so that everyone is absolutely clear about what their rights are. Reading the explanatory notes showed me that I have not been aware of my consumer rights in the past and have missed several opportunities to exercise them. We want to avoid that situation, and as my hon. Friend says, the 30-day rule is a simple concept for people to grasp. Within it, there needs to be follow-up to ensure that people are refunded quickly, so that they can choose where to take their custom.

Will the Minister provide some clarification on when exactly there is a right to a full refund and when it is reasonable to expect the person supplying the goods or service to make good through repair? I am sure that many of us get a gut instinct sometimes, such as when the washing machine breaks down on day three—we think, “This machine is never going to work. I’m not going to trust it.” Weeks and weeks of repairs and waiting for parts do not result in the item performing in the way it was described, or looking as it did in the showroom. At what point does the consumer have the right to demand a refund, and what is reasonable?

I remember having such an experience when my four children were young. The washing machine broke down, and I was constantly told that I had to wait for repairs. In the meantime, I was trying to keep my children in clean clothes, but clothes were being damaged. What are people’s rights, and how will they be communicated to people? Do not the amendments provide the Minister with a great opportunity to make the message that is sent to consumers clear and simple, so that they can exercise their rights? I look forward to her response.

Thank you again for calling me, Mr Amess—I will keep my knees moving for the rest of our proceedings.

Jennifer Willott (Liberal Democrat, Cardiff Central)

Clearly, it is extremely important that consumers get their money back, or some compensation, if they exercise the right to reject something. An important part of the process under the Bill is that people can have confidence and faith that that will happen. To answer the point made by the hon. Member for—

Fiona O'Donnell (Labour, East Lothian)

East Lothian.

Jennifer Willott (Liberal Democrat, Cardiff Central)

Thank you. There are a lot of Members on the Committee whose constituencies have “East” in their name.

A consumer will be eligible for a full refund if they reject a purchase in the first 30 days. Regarding the issue of having to go through repairs, the Bill lays out clearly that consumers will have the right to one repair. If the goods still break down or are still not working after that, the consumer will be able to reject them.

I complete understand the hon. Lady’s point about washing machines, children and vast quantities of dirty clothes. Clearly, it is extremely frustrating for people if they have to go through an entire cycle over and over again—getting things fixed, seeing them break down and having to wait again. One of the problems with the current law is that it is not clear how many times a consumer has to put up with attempting to get something repaired before they can finally get their money back.

One of the strengths of the Bill is that it stipulates that there is only one chance to get the goods repaired. If the goods still do not work or break down again, the consumer will have, at that point, the right to reject them and get a refund. Normally, within the first six months, that will be a 100% refund. Therefore, if the goods break down and the consumer has had them repaired, but they break down again within the first six months, the consumer will normally get a full refund. It is important that people know that, and that is one of the ways in which the Bill will introduce clarity.

Where a consumer exercises those rights, the Bill provides that the trader has a duty to give the consumer a refund—either money or something else transferred to the trader—for those faulty goods.

Andy McDonald (Labour, Middlesbrough)

I want to ask the Minister for some clarification. I have not read this particular part of the Bill thoroughly enough, but I think the interpretation must be that we will have a weakened position compared with what we have now under the Sale of Goods Act 1979. I seem to recall that there is currently no obligation currently to entertain one attempted repair. The statutory right under the 1979 Act is the ability to reject the goods outright. Will that still be the position under the proposal before us now?

Jennifer Willott (Liberal Democrat, Cardiff Central)

The 1979 Act will still apply, so consumers can pursue their rights either under that Act or under the Bill. However, for an awful lot of people, if they have purchased something and it has broken down, they want it to be fixed so that it will work. If someone has paid for a washing machine, it is much simpler for people to get it fixed and carry on using it, rather than having to reject it and going to find another one. Clearly, there will be circumstances—for example, if there is regular flooding in the kitchen or the machine trashes someone’s clothes—in which a consumer may want to get a new machine, but in many cases, getting it repaired once will be preferable.

Andy McDonald (Labour, Middlesbrough)

Are we not running the risk of confusing the consumer? On the one hand, they can say, “I have something that does not function as it should. Take it away. I want my money back. I am unhappy with that. That is my right under the Sale of Goods Act.” On the other hand, under this Bill, the trader might say to the consumer, “Oh no, you have to accept at least one opportunity for repair.” Does that not muddle the position for both the trader and the consumer?

Jennifer Willott (Liberal Democrat, Cardiff Central)

I apologise—I was wrong. The Bill will replace the 1979 Act for trader-consumer relationships. The right to reject is transposed from the 1979 Act to the Bill, but with the 30-day limit, which is what I think is currently in the 1979 Act.

At the moment, there is no limit to the number of repairs that a consumer has to accept before it is clear that they can finally reject the goods. What we are doing, following the Law Commission’s recommendation, is introducing the right to reject after one failed repair. It is much simpler for people to understand that they can reject an item at that point.

Fiona O'Donnell (Labour, East Lothian)

Continuing with the laundry day metaphors, I do not want to get the Minister in a spin, but I am now confused as to where consumers’ rights sit in the event of faulty goods. Do they have, as the Minister initially specified, a right to reject the item as faulty, as it is not performing, or do they have to allow the trader to attempt one repair? Within what time frame does that repair have to be carried out?

Jennifer Willott (Liberal Democrat, Cardiff Central)

The consumer has the right to reject within 30 days across the board, but they have the right to accept one repair—

Stephen McPartland (Conservative, Stevenage)

Will the Minister confirm that the consumer rights now being put forward do not take away any consumer rights, but rather add to them, so all the existing consumer rights are still there?

Jennifer Willott (Liberal Democrat, Cardiff Central)

Yes, there will still be the short-term right to reject, which is within 30 days. If someone buys something that causes problems right from the beginning, there is the right to reject within 30 days. At that point, there is the right to one attempt to repair or replace, and if that does not work, there is also the right to a refund. It is fairly simple, although it may not appear to be, having just had this conversation. Consumers do have a simple set of rights.

Andy McDonald (Labour, Middlesbrough)

For clarity and to help the Minister, is there an unqualified right to reject the goods and demand a refund within 30 days, but beyond that, an opportunity to repair once?

Jennifer Willott (Liberal Democrat, Cardiff Central)

Yes, the hon. Gentleman puts it very neatly. I could not have put it better myself.

Fiona O'Donnell (Labour, East Lothian)

Does the person who has provided the goods have a duty to inform the consumer of their rights, so that they understand that within the first 30 days they do not have to accept a repair and can reject the goods at that point?

Jennifer Willott (Liberal Democrat, Cardiff Central)

That goes back to our previous debate about how we ensure that both businesses and consumers have that information. Clearly, it will be critical that consumers have access to that information so that they know what their rights are.

With regard to a refund, the arguments on whether or not to have a strict time limit are finely balanced. The Government believe that the potential disadvantages of introducing a time limit outweigh the benefits that the change could bring, and I will explain why. I appreciate that on the face of it the issue could seem clear cut, but there are arguments on both sides. I know that my predecessor, my hon. Friend the Member for East Dunbartonshire (Jo Swinson), considered this aspect of the Bill closely.

We need first to consider the scale of the problem. I am aware that some consumer organisations have given anecdotal evidence of delays in obtaining refunds, as we heard during our evidence sessions, but I have not seen any evidence that that is a significant area of consumer detriment. For example, the 2012 consumer detriment survey used interviews with more than 10,000 people to identify the biggest problems consumers faced, and delayed refunds did not feature in the key areas where consumers were experiencing problems.

In the evidence provided to this Committee, the business representatives were slightly confused about why this was being raised as a priority. The British Retail Consortium spokesman said:

“Can I question the question? Has an issue been raised on the time it takes for refunds?”––[Official Report, Consumer Rights Public Bill Committee, 11 February 2014; c. 34, Q72.]

Contrary to the suggestion by the hon. Member for Walthamstow, when the spokesmen from the British Retail Consortium and the Federation of Small Businesses said that they were happy with the 30-day time limit, they were talking about the 30-day right to reject goods, not about introducing a 30-day time limit on refunds. There appeared to be confusion about whether it was an issue, and I have not seen any evidence that it is a big problem.

Clearly it is not the case that delayed refunds never happen. We have heard anecdotal evidence, and a number of members of the Committee have said that it is a problem that they have experienced, but the small number of cases that we have seen tend to involve businesses deliberately avoiding making a payment. In the small number of cases of shoddy practice, businesses will use any excuse not to pay back. A time limit will not solve that; they will just argue about something else instead—whether there is a fault or how much the refund should be, for example. In those instances, enforcement is the only way to ensure compliance, rather than putting a time limit in the Bill. Good business will follow good business practice. Without a time limit to refund, the vast majority of businesses will refund as soon as possible. We heard that in the evidence from the business organisations on the first Committee day. It is beneficial for them to do so, reputationally as well as competitively.

Stephen Doughty (Labour, Cardiff South and Penarth)

I appreciate that the Minister is referring to a survey, but I have seen numerous examples in my casework recently and have experienced such issues myself. Has she not seen them in her casework? Perhaps other hon. Members have examples they can share. The problem seems to be growing and it causes people a lot of stress. Sometimes people simply accept delays and do not make much fuss because they do not realise what their rights to receive a quick refund are.

Jennifer Willott (Liberal Democrat, Cardiff Central)

I do not doubt for a second that delayed refunds happen. It clearly happened to the hon. Gentleman. We have seen it across the board, but the evidence for it is anecdotal rather than measureable. When the survey was done, it did not identify such delays as a large-scale problem. It was not one of the key consumer detriment issues that people raised. I am not denying that it happens; it clearly does.

Andy McDonald (Labour, Middlesbrough)

The Minister talks about the scale of problem. Citizens Advice reported, admittedly on 27 December 2012, that shoppers had been left almost £3 billion out of pocket because they faced lengthy delays for refunds and the replacement of faulty goods. I suggest that the problem might not be on the small scale that she suggests; it might be more significant than we think.

Jennifer Willott (Liberal Democrat, Cardiff Central)

All I can base my remarks on is the survey of 10,000 consumers, which did not identify such delays as a key consumer detriment issue. I do not deny for a second that they happen; they clearly do. The hon. Member for Cardiff South and Penarth made clear that it happened to him. It is clear from the evidence from consumer groups and, I am sure, MPs’ casework that it happens, but the issue is finely balanced. Such delays do happen, but I will come in a moment to what would happen if we introduced a time limit.

Stella Creasy (Labour, Walthamstow)

Far be it from me to express a note of caution, but did the survey to which the Minister keeps referring ask consumers about delays in securing refunds? After all, there is always a difference between whether the question was asked and whether the issue was raised.

Jennifer Willott (Liberal Democrat, Cardiff Central)

My understanding is that, yes, it did ask that. Evidence we were given by the CBI and the FSB shows that good businesses want to maintain their reputation and act competitively. For many of them, part of that is offering extremely good customer service and ensuring they offer refunds as quickly as possible. I appreciate the argument that we could at least set a backstop to limit an area that unscrupulous traders might use to avoid refunds, but we need to gauge that against the potential disadvantages. By setting a limit, there is the real danger that it could become the default, with businesses being legally able to hang on to a customer’s money and their not receiving a refund until day 30, which would of course be to the detriment of the customer. The best businesses will certainly want to ensure that payment is processed as quickly as possible, to provide good customer service and keep people coming back. I fear that a minority might feel entitled to operate to a slower deadline if they were able to delay payment to day 30.

Andy McDonald (Labour, Middlesbrough)

Is not the opposite true? We have good practitioners on our high streets that offer to refund money immediately. There has been no statutory obligation on them to do so, but they differentiate themselves by offering that excellent service. I am not sure that setting a backstop and a limit would be to the consumers’ detriment. Good practice will always come to the surface. We are talking about where good practice does not happen.

Jennifer Willott (Liberal Democrat, Cardiff Central)

That is certainly true. There are businesses that pride themselves, as I said, on their customer service, which is one of the things they use to mark themselves out from their competition, but we are looking at traders across the whole economy. We are not looking just at high street shops, where it may be much easier to process a refund very quickly. We are talking about services and much more complicated purchases that often take place at a distance, and that could involve an international dimension as well. We are looking at the whole range, which constitutes quite a wide variety.

Brooks Newmark (Conservative, Braintree)

Again, I am sympathetic to what the Opposition have been saying, but this is part of a much wider problem, in that the weakest point in the chain unfortunately becomes the consumer, because the suppliers that we have bought our goods from are also being squeezed and sometimes are not paid for 60, 90 or even 100 days. At the end of the day, the consumer is the easiest to squeeze.

Jennifer Willott (Liberal Democrat, Cardiff Central)

That is certainly true and it is one reason why I am concerned that setting a time limit in the legislation could create knock-on difficulties where refunds are delayed by third parties, such as through banking mistakes or in transfers that these people cannot control, as my hon. Friend the Member for Braintree said, as part of the chain.

The amendments would allow the consumer, where the trader fails to refund them within 30 days, to seek damages from the trader proportionate to any loss that the delay causes them, but I do not believe that that is necessary. I will come on to that. The amendments are also designed to make it a legal requirement for the trader to refund a payment, whether that was monetary or some other transfer, by the original format of payment used to obtain the goods or digital content. If the consumer has paid by debit card, the trader is entitled to offer to make the refund to the debit card used to make the purchase. However, alternative methods of refund—for example, cheque or cash—can be offered and in fact may be requested by the customer.

Clearly, if there are security issues, other payment options might be more appropriate. Cheques may or may not be a safer option than handing over large amounts of cash, for example, depending on the circumstances. I believe that it is important not to mandate a particular approach that may not be convenient for the consumer or may not be as secure. For example, a consumer may pay by cheque at a shop premises, but send back faulty goods by post. It may be less secure for the trader then to send a cheque back by post, rather than to do an electronic transfer, if the consumer cannot visit the shop premises. It would also be a slower means of transferring the money back if a cheque was sent by post. Therefore, ensuring flexibility is important.

The Bill already protects the consumer from being fobbed off with store vouchers or a credit note when returning faulty goods where they have paid with money; that would not normally be acceptable. We do not want to alter those arrangements: they provide flexibility and convenience for consumers and businesses alike.

Clause 46 protects consumers where digital content damages their device or other digital content. I will not go into the detail of that clause now, because we will come to it later, but it is intended to cover contracts where the consumer may not have paid any money to the trader who is at fault. It is intended to cover damage to the consumer’s device or digital content caused by the trader’s digital content. There may not even have been a payment method and, where there is, depending on the scale of the damage, it may not be appropriate to refund the payment method with the compensation payment. The consumer may not want that money going on to their credit card or debit card. They may want it to go into a separate account if what has been damaged is a different item. By reducing the options, we would take away flexibility and thus limit the choice that the consumer and the trader have.

Fiona O'Donnell (Labour, East Lothian)

The Minister may be about to address this question. Where a consumer has entered into a credit agreement, would any interest that had been paid in the first 30 days also be refunded?

Jennifer Willott (Liberal Democrat, Cardiff Central)

I will get clarification on that point for the hon. Lady. I understand that, if there is a credit agreement and a loan has been taken out for the faulty product, there would be joint liability for that good under the consumer credit agreement, so the consumer could also look to the creditor for protection. For example, if the good was bought with a credit card, the consumer would have additional protection for that purchase. However, I will come back to the hon. Lady with the specific answer to her question.

The Bill as it stands gives consumers scope to get a refund if they are entitled to that—if their statutory rights are breached—but also to claim damages as an alternative to exercising their right to reject. Consumers can claim damages in addition to exercising the right to reject, or any other rights to money back, if they have suffered additional loss. Although consumers cannot claim twice for the same loss, if they have suffered other loss, they can claim damages for that.

I believe that the Bill offers the right amount of flexibility and choice for the consumer without limiting the time and manner in which a trader should refund a consumer.

Sheila Gilmore (Labour, Edinburgh East)

The position that the Minister outlines is that the best organisations will want to give a refund as soon as possible. Given that consumer law often deals with those who do not comply, surely it is a good thing to include the time limit—the good retailers will presumably want to do even better than that.

Jennifer Willott (Liberal Democrat, Cardiff Central)

I agree that the best businesses—those that pride themselves on their customer service and so on—will continue to act as speedily as possible. However, our concern is that there could be several unintended consequences. For example, by setting a 30-day limit, we could end up with companies that have slightly less proactive customer services taking the longest time. Other issues may affect a business’s ability to make a speedy refund, particularly if international trade is going on or there is a long supply chain, which may make it more challenging.

I hope that it is okay if I write to the hon. Member for East Lothian to clarify her point about the credit agreement and the interest paid.

Stephen Doughty (Labour, Cardiff South and Penarth)

I am still struggling with the idea that a time limit will encourage some businesses to take longer. Certainly, as a consumer, given the challenge I had with EE in getting a refund, I would have liked to know that there was a backstop power pushing the company to deliver it to me in 30 days. I consider 30 days a reasonable amount of time for it to pay money back to me. If it can do it quicker, brilliant, but 30 days is reasonable. It actually took a lot longer and required multiple phone calls. There was no sense that there was any pressure on the company to give that money back to me quickly.

Jennifer Willott (Liberal Democrat, Cardiff Central)

As I said to the hon. Member for Middlesbrough, we are considering a complicated subject. The amendments cover pretty much all goods, all services, all digital content in a complex marketplace. A time limit may be completely appropriate for getting a payment back on a mobile phone bill, whereby the company takes the money instantly and could probably give it back fairly quickly, but in other cases, the system is a great deal more bureaucratic, requires more checking and is much more complicated. Thirty days could be complex—for example, when does the period start and when does it finish? The time limit could create unintended consequences and that concerns me.

We have examined the matter closely and I have huge sympathy with the hon. Gentleman’s point.

Stephen Doughty (Labour, Cardiff South and Penarth)

Will the Minister give us some concrete examples of the complex scenarios that she mentions? That would help me understand her points a bit better. In a world where transactions can occur so quickly and where banking technology has moved on so much in the past few years, I do not understand the complexities to which she refers, apart from in the small number of very complicated international transactions for which fraud and security checks have to be done.

Jennifer Willott (Liberal Democrat, Cardiff Central)

There will be cases in which, for example, a shop or business is part of a larger organisation and there has to be approval at various points up the scale so something cannot just be refunded in the local shop; the refund has to go back to the head office so that it can be agreed and processed. It is sometimes easy to think from our personal experience of things such as mobile phone companies or taking a jumper with a hole in it back to a local shop, but the amendments address a much broader range that may be much more complex. As I have said, a case might involve a chain of approval before something can happen.

Andy McDonald (Labour, Middlesbrough)

Is that not the nub of the matter? We are saying that there are circumstances in which someone should be expected to wait more than 30 days. I just asked the Minister to ponder on that. She said that the refund might have to be kicked up the chain, but the principle that underpins all our consumer legislation going back decades is that the customer’s relationship is with the retailer they have dealt with. It is not a question of saying, “Excuse me, but I have to deal with manufacturers and a supplier up the chain.” The customer can reply, “I really don’t care about that. I am dealing with you. I have given you my money on my credit card or debit card, and I have rejected the goods because they are not fit for purpose. I want my money back, and I want it back right now.” It is not unreasonable for someone to say that.

Jennifer Willott (Liberal Democrat, Cardiff Central)

The hon. Gentleman is right that the relationship is with the trader. I am not necessarily saying that there has to be approval up the supply chain, but if someone purchases, say, a sofa from a big national retailer, the shop itself might not necessarily be able to process a refund immediately. In practice, the consumer is entitled to a refund as soon as the right to reject the goods is exercised. Any unreasonable delay will be a breach of the trader’s responsibilities under the Bill. Most refunds will be made as soon as possible, and it is clear from the evidence we received from the business organisations that most, if not all, of their members want to process refunds as soon as possible. One way in which businesses make themselves competitive in the marketplace is by ensuring that their customers are happy by giving them the treatment that they feel they deserve so that they go back for more. The overwhelming majority of businesses do not need to be told that it has to be 30 days, because they will be processing the refund far quicker than that. The issue I have laid out is that, if we have the backstop position of 30 days, the onus is taken off the trader to give the refund as quickly as possible, which changes the balance between the consumer and the trader.

Fiona O'Donnell (Labour, East Lothian)

I am currently trying to support local businesses in my constituency. I am trying to get a refund from one business and the owner tells me that he cannot refund me because a large wholesaler has not yet refunded him. Has the Minister considered giving the same rights to small businesses so that we can try to break the chain?

Jennifer Willott (Liberal Democrat, Cardiff Central)

The hon. Lady is trying to entice me into reopening the debate that we had on our first day. I am sure that the issue of the business-to-business relationship, rather than the business-to-consumer relationship, will come back, and we will consider it in response to the FSB’s report, but it is not one for the Bill.

I hope I have answered Members’ queries, and therefore ask the hon. Member for Walthamstow to withdraw her amendment.

Stella Creasy (Labour, Walthamstow)

This has been an interesting debate that has shown precisely why we need to simplify consumer rights legislation. There is no clarity on consumer rights or on what consumers can reasonably expect. It is worth considering some of the things that have been said in response to that, particularly by the Minister.

I defer to my hon. Friend the Member for East Lothian, who explicitly asked all the organisations that gave evidence to the Committee about the 30-day issue. When the Minister suggests that the organisations’ agreement that it is not a problem had nothing to do with the request by my hon. Friend, she is not doing justice to the transcript or to what my hon. Friend actually asked. As we have heard today, my hon. Friend feels very strongly about that, as we all do.

Fiona O'Donnell (Labour, East Lothian)

It might help my hon. Friend if I cast my mind back. My frustration was that the person giving evidence did not even seem able to grasp the concept that there would be a delay, and thought that it was simply about banks and was not businesses’ fault. They did not realise that there are some businesses out there that deliberately do not process refunds as quickly as they could or should, especially when their own cash flow is causing concerns.

Stella Creasy (Labour, Walthamstow)

My hon. Friend comes to the nub of this: is this a Bill about rights for consumers? If it is, our concern should be for the consumer who is left hanging because of decisions made by the trader that they are dealing with. It seems bizarre to specify time limits in parts of the Bill but not in others, given what the Minister has said about the importance of flexibility.

We know that time limits are the most easily understood and clearest provision. We have all said today that 30 days is a reasonable amount of time for someone to expect to get their money back; the Minister agrees with that. Waiting for longer than a month can cause considerable inconvenience. If it is a substantial purchase such as the sofa that we have discussed, it could be month’s wages for somebody. It could be a huge amount of money for them to be waiting to have refunded. It seems rather odd to the Opposition that the Bill does not say that, in that instance, we must make sure that the consumer has protection from start to finish. Woe betide someone whose sofa turns out not to be the perfect accoutrement to their house that they dreamed that it was going to be.

I do not think that the Minster’s logic stacks up. She said that there should not be a problem, because that was what the people who gave evidence said. However, where there is a problem, it is because traders are seeking to supersede and undermine someone’s rights through what the Minister called shoddy practice. That seems to me to be exactly the point at which we should step in to say “Hold up, this is shoddy practice—let’s define a time period so that they cannot claim that this is reasonable.” We should say that if a trader is doing that, the consumer has rights. Indeed, if they are not paid back within 30 days and it has an impact on their financial position, they should be compensated for that in addition to the compensation that they might get for a faulty good.

Stephen McPartland (Conservative, Stevenage)

rose—

Fiona O'Donnell (Labour, East Lothian)

rose—

Stella Creasy (Labour, Walthamstow)

I can see that the subject has aroused passions on both sides, and in the spirit of bipartisanship I give way to the hon. Member for Stevenage first.

Stephen McPartland (Conservative, Stevenage)

My understanding of amendment 13 is that the final part of it suggests that it applies unless consumers waive their rights. My concern is that unscrupulous traders would say that a person had waived their rights, and traders who pay within 30 days would say that they had not. Additionally, organisations such as Amazon and iTunes would say that, as part of their terms and conditions, a person has waived their rights.

Stella Creasy (Labour, Walthamstow)

As the hon. Gentleman will see, the amendment very clearly states that it would be up to the consumer to decide to do that. We think that that would cover the small set of instances—I note that the Minister struggled to find ones that would fit this test—where there might be some reason for a delay in repayment beyond 30 days. Let us be clear that we are not talking about delays in the delivery of a good, or even delays in repairs, such as for the sofa that is so perfect and specialist that the craftsman has to come from Italy to fix the legs. We are talking about cash—the payment that has been made and that a trader is now holding because a good has been paid for. It does not seem unreasonable to us to say that a person should be able to recoup that within 30 days.

Andy McDonald (Labour, Middlesbrough)

Can my hon. Friend imagine any circumstance where it has been established that the goods are defective, that they have been rejected and that the contract is at an end? In the example that the Minister gave of the sofa that had the hidden tear, that is absolutely not acceptable, so it would go back. Are there any circumstances in which a consumer should be obliged to wait more than 30 days? As my hon. Friend rightly said, the sum could be up to a month’s wages. Is that not absolutely unacceptable?

Stella Creasy (Labour, Walthamstow)

I agree with my hon. Friend. We deliberately did not talk about the point at which these rights will be exercised, because that appears in later clauses. Clause 24 covers those rights and, if I read it rightly—the Minister may correct me—this final right to reject does not come in until the goods have been recovered. So it is not even as though there were a delay in collecting the faulty sofa, which might be a reason why it would take longer than 30 days to pay somebody back, as the company would have to ascertain that it had the sofa back. There does not seem to be any reason why we should not create the back-stop that we suggest.

The Minister’s logic—that if we create that back-stop, companies will delay their repayments until they reach the limit—does not accord with our recognition in earlier conversations that good businesses will want to get people’s money back to them as quickly as possible because, frankly, that will make them more likely to spend money with them again. If a person has had a good experience and good customer service, they will probably go back to Amazon or John Lewis. If they have had a bad experience, such as a lengthy delay in getting their money, they will probably think twice about shopping with them. There is every incentive for traders to get that stuff right first time. The amendment would deal with the shoddy practices rather than accepting that shoddy practices will always take place.

Fiona O'Donnell (Labour, East Lothian)

Getting a refund face to face with the person who supplied the goods or services, possibly within the hearing of other consumers, is much easier. However, as the way we shop changes and shopping increasingly moves online, there will be more opportunities for traders to abuse their rights. We have an opportunity to future-proof the Bill and ensure that online purchases of goods or services are refunded quickly.

Stella Creasy (Labour, Walthamstow)

I completely agree with my hon. Friend. As more and more transactions become paperless, returning actual currency becomes easier and easier, which makes it less and less sustainable to argue that a 30-day deadline is somehow hard to meet.

The Minister queried why amendment 13 stated that the payment should be returned in the manner in which it was made, and then went on to say that the Bill provided protection from being fobbed off with vouchers. The amendment contains the specification precisely because of that fobbing off process. In instances where the consumer wishes to waive that right, the amendment would allow them to make a judgment themselves on how the refund should be paid. The amendment attempts to take into account those odd instances—although as yet nobody has been able to identify any—that would justify a lengthy delay of beyond a month, while giving the clarity of protection of a 30-day limit.

The Minister should revisit the issue and consider how we can give people confidence. I do not think that she herself feels her case is a strong one. She admits that there is a difficult balance to be struck. The proposal has strong support among consumer groups, and among the business groups that gave evidence there was an acceptance that 30 days was not an unreasonable deadline to set. We cannot see why we would not close the final loophole in the process, so that consumers, having gone through the various hurdles we will go on to discuss, can know that there is an end in sight to any complaints process.

We reserve the right to come back to the matter on Report. I encourage Government Members to go out and talk to their constituents; Opposition Members are certainly getting reports of people who are waiting inordinately long periods of time to get their money back, which has financial consequences for them. In a Consumer Rights Bill, our eye should be on the impact on the consumer of such delays, rather than the impact on the trader. With that in mind, I beg to ask leave to withdraw the amendment.

Stella Creasy (Labour, Walthamstow)

I beg to move amendment 19, in clause 20, page 11, line 24, at end insert—

‘(9A) A consumer shall not be obliged to incur any costs when returning rejected goods except those incurred in returning the goods to the place where they acquired physical possession of the same goods.’.

The amendment deals with a matter that follows on from the previous discussion. Again, I hope that it is not controversial. It is a point that all of us have experienced, namely the cost incurred when returning a good. A consumer should not have to pay to return something that is faulty, and the amendment would require a trader to ensure that consumers do not have to incur costs in returning rejected goods except any incurred when returning the goods to the place where the consumer acquired physical possession of them.

We are not saying that the trader has to pay a consumer’s bus fare to go back to the jumper shop. However, to return to the sofa—sofas and jumpers are our concerns today, whereas it was kettles previously—a consumer should not have to pay for a sofa to be returned to the depot because it is faulty. That is a fair principle. If someone has been sold faulty goods, the problems that causes should not be compounded by their having to pay for the goods to be returned to get a refund. That the Bill does not have that clarity is a concern.

Sheila Gilmore (Labour, Edinburgh East)

Has my hon. Friend come across the practice of some online companies of charging a consumer when they place an order for what is effectively return postage? If someone is returning an item because they do not like it, that might be one thing, but it is different when there is a fault. Does she have any views on that practice?

The rest of the debate is in Hansard.