Office of Fair Trading

Debate between Lord Kennedy of Southwark and Baroness Wilcox

Monday 13th February 2012 Lords Chamber

[Baroness Wilcox]

The noble Lord was a very fine lawyer in his time, as I can witness, because he worked for me once and we won, wonderfully. I am inclined to want to agree with him, but at the moment the consultation is going through and I cannot make any statement at this stage. But I shall be interested in his views when the Government come out with theirs in the next few weeks after the finalisation of the consultation.

[Lord Kennedy of Southwark]

Will the Minister agree to speak to the Office of Fair Trading? One area that it could shed a bit more light on is payment protection insurance misselling claims. A whole industry has developed around it whereby people can put a claim in; they can go to a company, are given 25 per cent of the money that they have lost, and have to pay the companies. That is quite disgraceful.

[Baroness Wilcox]

The Office of Fair Trading is of course an independent body and is best placed to balance the work that it does; it is not the Government’s place to tell it what to do.

Payday Loans

Debate between Lord Kennedy of Southwark and Baroness Wilcox

Tuesday 10th January 2012 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what action they will take to ensure consumers are fully informed of the cost of payday loans.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)]

My Lords, increasing transparency and understanding for consumers who use these loans is a key part of the work which came out of our consumer credit review, which is now concluded. We are working with the industry and consumer organisations to ensure that concerns about practices in this market that lead to consumer detriment are addressed in future codes of practice.

[Lord Kennedy of Southwark]

Does the noble Baroness agree that making sure that consumers make an informed choice is of paramount importance and that the consumer credit advertising regulations may be deficient in this respect? Will she facilitate a meeting between me and some campaigners with her right honourable friend the Business Secretary to discuss that matter?

[Baroness Wilcox]

I agree with the noble Lord that a well informed consumer is an empowered consumer. The information which is given out is often process driven by the people wishing to lend the money rather than those trying to borrow it. I have spent a long time looking at this, so I am with the noble Lord. I would welcome any ideas that he has which would enable us to work together on this.

Loan Companies: Interest Rates

Debate between Lord Kennedy of Southwark and Baroness Wilcox

Thursday 3rd November 2011 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what measures they propose to deal with high street lenders who charge excessive rates of interest, particularly to those on the lowest incomes.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)]

My Lords, the Government recognise that it is often the most vulnerable who have to pay the highest costs when accessing credit. We are commissioning research into the impact of introducing a cap on the total cost of credit that these lenders can charge. We are also looking at the high cost credit market as part of our consumer credit review and we will publish our final response before the end of this year.

[Lord Kennedy of Southwark]

I thank the noble Baroness, Lady Wilcox, for her response. Does she agree that companies which charge 2,000, 3,000 or even 4,000 per cent are legalised loan sharks? Will the Government look at requiring these companies to put a health warning on their advertisements in highly visible, large type explaining clearly the costs of their services and advising people that their local credit union would offer better value for money?

[Baroness Wilcox]

The noble Lord, Lord Kennedy, has covered three big items. I know what an expert he is on the last one, so I will leave that for the moment. This Government and the previous Government have looked again and again at capping interest rates, but our worry has always been that that would push people towards illegal money lending. We then do not know when they are in trouble and they can be treated very violently. Even looking to see whether we should be changing this in any way is a new venture for us. The noble Lord is absolutely right in his second point. People should have the right information on which to base their choices.

Groceries Code Adjudicator Bill

Debate between Lord Kennedy of Southwark and Baroness Wilcox

Monday 13th June 2011 Lords Chamber

[Lord Kennedy of Southwark]

My Lords, I think we would all support the groceries code and adjudicator who will ensure that British farmers and growers get a good price for their quality produce. However, can the noble Baroness tell us whether other producers will get a fair price for their produce? I am thinking, in particular, of the banana industry in the Caribbean.

[Baroness Wilcox]

I am delighted to answer this question because I know that third-world producers are very keen for the adjudicator to be in place. I agree that suppliers to the large supermarket groups come in all shapes and sizes. I was once one myself, so I know exactly how this process works and exactly where the worries lie on either side. However, it is worth remembering—I used to have to remind myself of this—that these are huge contracts and people go for them because they are a wonderful way of increasing employment and expanding one’s business. Therefore, a balance has to be found.

Postal Services Bill

Debate between Lord Kennedy of Southwark and Baroness Wilcox

Wednesday 4th May 2011 Lords Chamber

[Baroness Wilcox]

I will get a note and come back to that. I will continue with my point for the moment. Amendment 55, tabled by the noble Lords, Lord Clarke and Lord Christopher, would amend Amendment 54 to require the Royal Mail company’s report to include details of financial support, both in cash and in kind, for the museum collection and its archive. In tabling Amendment 54 we have not been prescriptive about what should or should not be included in the report. As I have said, we fully expect a Royal Mail company to continue to recognise the importance of its heritage. How it chooses to support the museum and archive will be a matter for the company. However, any support that it gives to the museum and archive will be an intrinsic part of its activities, and it follows that the report will include these details. It is not, therefore, necessary specifically to include this requirement in the new clause.

The Government want to see the heritage of Royal Mail preserved. Amendment 54 provides the right balance and places a sufficient spotlight on Royal Mail’s activities to ensure that the Government and Parliament have the opportunity to scrutinise those activities, and for Royal Mail to demonstrate its ongoing commitment to its heritage. I hope that your Lordships will be able to support Amendment 54. I ask the noble Lords, in view of the reassurances that I have given, kindly to withdraw Amendment 9 and not to move Amendment 55.

[Lord Kennedy of Southwark]

My Lords, I thank all noble Lords who have spoken in the debate. I also thank the Minister for her response, although it was disappointing. My amendment does not seek to affect the disposal of Royal Mail; it seeks merely to protect the name. I will not press the amendment to a vote, but the Government have taken an unnecessary and risky decision. I hope that they are right, but if they are proved to be wrong a tragedy will result which could so easily have been avoided. I beg leave to withdraw the amendment.

Postal Services Bill

Debate between Lord Kennedy of Southwark and Baroness Wilcox

Monday 14th March 2011 Lords Chamber

[Baroness Wilcox]

My Lords, I say to the noble Lord, Lord Borrie, that we intend to put safeguards in place to ensure that the royal associations are used by Royal Mail respectfully and appropriately at all times. We have not yet finalised how these will be structured, but they could, for example, be set out in a legally binding agreement between the company and the Secretary of State. When drawing up such an agreement, we would seek to ensure that the use of the name “Royal Mail” was linked to the provision by the company of the universal postal service, and this would prevent it being used in other circumstances.

I wondered whether someone was going to ask whether there is not the potential for a foreign owner to misuse the royal associations. That was almost the thrust of the question. We appreciate that there might be concerns about the potential for misuse of these associations, and we propose to put safeguards in place to ensure that they are used respectfully at all times. However, this is a commercial transaction and we wish to stop at this point. I am sure that the noble Lord, Lord Borrie, who knows what brand names are all about from his time as director-general at the Office of Fair Trading, will know all the protections that are encompassed around that.

[Lord Kennedy of Southwark]

I thank the Minister for her response, which I am a little disappointed by but hope she will reflect on. I reserve the right to bring this matter back on Report. I beg leave to withdraw the amendment.

Consumer Credit

Debate between Lord Kennedy of Southwark and Baroness Wilcox

Thursday 3rd February 2011 Lords Chamber

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what assessment they have made of the interest charged by loan and credit companies.

[The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)]

My Lords, the Government are looking at a number of additional protections for consumers in the credit market through the consumer credit and personal insolvency review, which is now going on. The review is headed up by the Department for Business, Innovation and Skills, which includes consumer affairs, and the Treasury. We are currently considering the evidence submitted in support of the review.

[Lord Kennedy of Southwark]

I thank the Minister for her reply. Does she agree that it is just wrong for some of the poorest and most vulnerable people in our society to pay interest rates of up to 3,000 per cent for credit? Does she further agree that the Government need to actively support the growth of the credit union sector and to support the link-up with the Post Office, and thereby give people access to an affordable, wide range of credit to meet their needs in their high street?

[Baroness Wilcox]

Yes, my Lords, of course I agree. The Government are aware of concerns about the high-cost credit market and suggestions that there should be a cap on high-cost credit products. We have been here before. There have been three reviews, from when the Opposition were in government and when we were in government before—we have reviewed this over and over again. The first time was 15 years ago, when I chaired the National Consumer Council. We are worried that people would go to illegal loan sharks to borrow money if there were capping. On the second part of the noble Lord’s question, we are doing everything we can to reinforce the link-up between the Post Office and the credit unions. It is a marvellous system and I hope to see it flourish.