Consumer Rights Act 2015 (Enforcement) (Amendment) Order 2019

Baroness Hayter of Kentish Town Excerpts

Tuesday 25th June 2019 Lords Chamber

We need to know that incidents like those with Whirlpool tumble driers, and tragedies like Grenfell Tower—although we hope that nothing like that, on that scale, could ever happen again—can be dealt with rapidly and effectively.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, like others, we welcome the draft order, the objectives of which we support. Anything that prioritises and increases consumer protection and safety is naturally welcome. It is just a shame that the way the Government are seeking to take us out of the EU will have exactly the opposite effect and risks reducing consumer protection. Indeed, it is notable how little involvement consumer bodies have been offered in the whole exit process—an issue we have raised repeatedly in this House, though sadly to nil effect.

We support the SI, but our concern is about the environment in which it will land, about which I shall make four points. The first is about the OPSS itself, which is, rightly, the key target for these new powers. Our worry is that, on its effective first outing, it has failed to convince. The Minister is well aware of the serious criticisms that Which? and others have of the OPSS Whirlpool review, which judged, inexplicably, that the modified machines posed only a low risk, as noted by the noble Baroness, Lady Neville-Rolfe. Which? described this early test of the OPSS’s intelligence and research abilities, and of its independence, or “bottle”, as “fundamentally flawed”. I do not know whether it was its research that let it down—it is interesting that it failed to interview any consumers. Indeed, had the OPSS sought some consumer input, it might have heard from my noble and learned friend Lord Goldsmith, whose grandchildren played in the kitchen completely unaware that immediately below them the tumble dryer had caught fire. Luckily, no one was hurt, but the family was out of the house for some months while the damage was repaired.

Was it its research that let it down, or was it the OPSS’s lack of bottle? It appeared, in the words of Which?,

“to favour business interests over people’s safety”.

It seems that the OPSS somehow had not grasped that it needed to look at Whirlpool’s miserable failure to deal with fire risk in its products, and therefore the resultant lack of public awareness of the risks posed in their own homes. I hope that by the time the order is activated we might see a more robust OPSS. Meanwhile, perhaps the OPSS could publish the list of affected Whirlpool machines, which we know it has and which Whirlpool refuses to release. It expects consumers to know about the potential problem, to know that their unit might be at risk, to be able to locate the serial number on their machine and then be able to type it into a very poorly advertised website.

Secondly, of course, there is the issue raised by the noble Baronesses, Lady Neville-Rolfe and Lady Burt, of the dire condition of trading standards departments, thanks to the Government’s cuts to local government funding. This reduction in funding has a direct influence on what trading standards can do. It is simply no good the Government boasting, quite rightly, that they have created powers, if they then starve the relevant authorities of the staff to employ those powers. Cuts in resources and staff of 50% mean that consumer protection that exists on paper simply cannot be effected in practice. Will the Minister assure the House that none of the powers in this order will lie dormant for lack of resources?

Thirdly, while we have strongly supported a number of the Government’s initiatives in consumer protection—particularly, I say in the presence of the noble Baroness, Lady Neville-Rolfe, the 2015 Act itself, but also progress on legislation on letting agents and other things—the problem is that it has all been a bit scattergun and without a coherent framework. Of course, it was much undermined by the Government’s abolition of the much-needed National Consumer Council, leaving a very patchy consumer representation landscape. As the Minister knows, we are delighted that the CMA seems to have picked up the cudgels on behalf of consumers, but we await a proper government response to this and across the patch. Will the Minister tell the House when we might expect the promised consumer White Paper? I offer him a range of responses—those pre-drafted ones that tend to come his way: “shortly”, “in due course”, “before long”, “in the fullness of time”, “very soon”, “imminently” or “before the summer”. We hope it might be the last of these, but it would be good to know.

Finally, my fourth point returns to Brexit. Which? warns that we could be flooded by a rising tide of unsafe toys, cars and white goods if the Government fail to reform consumer enforcement, because of our potential exit from Safety Gate, the rapid warning system through which European countries alert each other to products with serious safety problems. It flagged more than 2,000 non-food products last year. Not only do the Government need to negotiate the UK’s continuing participation in Safety Gate, they must ensure that the OPSS and other regulators have the tools to act on incoming alerts.

To repeat the thrust of our comments, we support this order. We need the powers, but also the intelligence and the enforcement if UK consumers are to be properly protected, so I hope the Minister will be able to offer some reassurance on that point.

[Lord Henley]

My Lords, I am grateful for the general support for the order from my noble friend and the noble Baronesses, Lady Hayter and Lady Burt, and for the questions they have asked.

I am also grateful, as always, to the noble Baroness, Lady Hayter, for offering me drafting advice, with a number of different options as to which word I could use for when a consumer White Paper might come out. I think I have used all those words at one time or another in the past; I even tried to tell the House many years ago that something would be published later that spring—I have to admit, in July it was quite difficult to argue that it was still spring. On this occasion I will try to be even more helpful to the noble Baroness. It will be published later this year; that gives her a final cut-off point. It will be there during 2019. If it is not there, she will have to come back to me and tell me that I have misled the House. If so, I will make the appropriate apology, but here is an assurance that it will be there.

I also assure my noble friend and the two noble Baronesses—I am grateful for everything that they have said—how important we think this is. This order is obviously essential as part of the process that the Government maintain as a priority to ensure that people across the United Kingdom continue to have confidence in the safety of all products that they buy and use every day. I assure the noble Baroness, Lady Burt, that without this order the Secretary of State would not be able to fulfil as effectively his lead role in managing national product safety incidents through the Office for Product Safety & Standards. He would not be able to assist the investigations of local authority trading standards in Great Britain, and district councils in Northern Ireland, that require the specialist expertise and capacity that the office can provide.

A number of questions have been raised, and I will deal with them in turn. I will start by giving an update on Whirlpool, which my noble friend Lady Neville-Rolfe asked about. As she knows, we made a Statement which was repeated in this House only a week or so ago. I assure her that the investigation into Whirlpool is ongoing. We will need to write further to her and others on the specifics of the case, but the statutory instrument adds to the enforcement regime of the OPSS and allows it to offer further support on that to local authorities.

However, as my noble friend will be aware, I can confirm that Whirlpool responded to the notification of intent from the Office for Product Safety & Standards to issue a recall notice on unmodified dryers. It is currently reviewing the information provided in detail, and we continue to urge anyone with an unmodified machine to unplug it and contact Whirlpool. Again, as I made clear to the House when I repeated the Statement, those who have a modified machine can be assured that it, as far as possible, will be safe—in so far as anything can be safe. It would probably be better if I wrote in further detail to my noble friend on the process and copied it to others, because obviously that process is ongoing.

[Baroness Hayter of Kentish Town]

Before the Minister moves on, I asked a specific question about Whirlpool. The people who do not have modified machines still do not always know that they have a Whirlpool machine, because they were sold under a lot of different names—perhaps 14 of them. You, the Government, know the list of the machines that they were marketed under; some are Hotpoint—I cannot remember all the names. Not everyone knows them. The Government know them, as do Whirlpool, but neither of you will publish that list. You will not give them to the electrical safety consumer bodies so that they can get them out, or put them on a website, and you are expecting people to know that their machine is one of them. If the Minister cannot give me the undertaking now that the Government or the OPSS will publish that, will he explain to the House why that vital piece of information is not being put in the public domain?

Whirlpool Tumble Dryers: Product Recall

Baroness Hayter of Kentish Town Excerpts

Monday 17th June 2019 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

My Lords, while thanking the Minister for repeating the Statement, I find it rather complacent. Whirlpool and the Government have rather dillied and dallied over this, despite tumble dryers causing a third of fires started by appliances; that is probably three per day.

Even now, with a belated recall covering only 500,000 of the affected machines, there is no list of the models available and Whirlpool refuses to release these details. The Minister urges people,

“with an unmodified, affected tumble dryer ... to unplug them and to contact Whirlpool”.

But consumers do not know whether their dryer is one of those affected, and even the charity Electrical Safety First has been denied the list. So consumers have first to find a serial number, which is not always easy, and then go on to a website and type in the serial number to even see whether their machine is affected. This is not good enough. Will the Government either compel Whirlpool to come clean with a list of the affected models, or publish the list themselves, because we know they have it?

[Lord Henley]

My Lords, I am not sure where the noble Baroness gets her figures, but they were faintly alarmist. She claimed that a third of all fires caused by domestic appliances were caused by tumble dryers. The figures I have show that the number of fires caused by domestic tumble dryers is coming down. There were only 724 last year, down from 808 the previous year—a 10% fall. I am told that in the figures for 2017-18, if you take all domestic appliances, some 16,000 fires were caused by electric appliances—so tumble dryers did not cause a third of them, as the noble Baroness claimed.

I will not defend Whirlpool, but it has mounted a fairly large operation to try to identify where the appliances are. It is reckoned that Whirlpool has got to something like 50% of the tumble dryers that need to be looked at, and there are probably another 500 or 1,000 or so to get at. We welcome Whirlpool’s response on what it is doing to identify those machines, get at them and make the appropriate modifications. As I said in the Statement, the number of fires in modified appliances is significantly lower than in those that have not been modified. I must repeat that the manufacturer has the responsibility to ensure product safety, and it should be for the Government—which is what we have done here—to take the appropriate action to hold it to account.

Competition and Markets Authority: Legislative and Institutional Reforms

Baroness Hayter of Kentish Town Excerpts

Wednesday 8th May 2019 Lords Chamber

Asked by

[Baroness Hayter of Kentish Town]

To ask Her Majesty’s Government what assessment they have made of the letter from the Competition and Markets Authority (CMA) to the Secretary of State for Business, Energy and Industrial Strategy dated 21 February which sets out the CMA’s proposals on legislative and institutional reforms to safeguard the interests of consumers and to maintain and improve public confidence in markets.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, the Question posed for debate is exactly the one that I want to ask of the Government: what is their response to the CMA’s proposals?

In one sense, I am sorry that we are debating this now, rather than when the CMA was established, when we did try to raise these very issues. My noble friends Lord Whitty and Lord Stevenson and I tried to get a consumer focus written into the CMA’s objectives, as well as its structures, via a consumer panel or board appointments, but we were rebuffed by the coalition Government—even as, in the same breath, they abolished the National Consumer Council. That did not augur well for consumer interests, which is why I welcome the approach set out in the CMA’s letter to the Secretary of State for Business, Energy and Industrial Strategy. I hope he will use the word “Energy” in his title to run with these proposals.

As we said at the time, and as the CMA chair has said, competition is not an end in itself but a tool to serve the intended beneficiaries: consumers. Although without competition, consumers are disadvantaged, if not completely ripped off, a simple economic analysis of markets without measuring consumer detriment simply is not enough—as the long-suffering public know, with higher prices and unfair practices. As the noble Lord, Lord Tyrie, wryly muses:

“Adam Smith’s invisible hand appears rather idle”.


There are particular reasons why we need regulators —or the law—to protect consumers: sometimes because there are monopolies but sometimes because of the specialist nature of the providers—doctors and lawyers come to mind. Often, though, regulators are needed where the individual consumer cannot challenge the provider themselves—unlike with a broken table or a faulty car, where the consumer can see the problem and knows who sold the goods to them. With many goods and services, the imbalance between consumer and provider is immense, particularly where consumers rarely make a purchase—houses and pensions come to mind; where the consequences are long term or invisible to the client, as with will writers and surveyors; where buyers cannot shop around for quality or price—letting agents, lawyers and e-commerce are examples; or where the mischief is so large that no individual can take on the system, such as when Volkswagen cheated to make cars look less polluting than they were. Drivers bought them in good faith, but they were actually mis-sold those cars. But what happened in the UK, as opposed to the States? There was no action here and no compensation for consumers, whose car resale value promptly dropped.

At present, the CMA can only address consumer detriment caused by an adverse effect on competition, not by gross mis-selling or unfair contracts. I recently won a case at the Advertising Standards Authority in which a so-called “treatment” for dementia had been advertised, but all that happened after I won was that the ads could no longer appear. There was no fine on the company. No one was responsible for contacting people who had bought these junk products, and there was no compensation for purchasers.

We need a regulator that will step in to protect all consumers from those who break the law. The current proposals in the letter to the Secretary of State would give the CMA the power to fine firms that flout consumer law.

We have debated past CMA failures in this House before, particularly in relation to secondary ticketing, where the CMA originally failed to measure the consumer detriment or to grasp that, in such a market, only it could act. I am pleased to say that more recently, it has applied for an injunction to stop Viagogo’s unacceptable behaviour. However, if it had had the power to fine earlier, it could have acted more quickly, cheaply and decisively than it could via drawn-out court processes. Although I am sure that Viagogo could have absorbed any civil fine, given its lucrative but dishonest practices, the threat of personal disqualification might have made the difference. Similarly, the CMA had to embark on lengthy enforcement against the care home company Sunrise Senior Living before securing a £2 million settlement for the inflated costs in T&Cs. However, the new proposals would have given the CMA interim measures to protect vulnerable consumers from unfair practices and even award compensation.

Another example is medicine, where pharmaceutical companies’ control of prices is wholly unchallengeable by individual patients, who either bear the costs through higher taxes for the NHS, the bulk purchaser, or lose because NICE feels the drugs are too expensive to prescribe. Indeed, even the bulk purchaser, the NHS, is weak in the face of determined pharmaceutical companies. The CMA’s involvement over Phenytoin suggests that the NHS might be losing some £200 million a year through such unfair pricing.

With unfair contracts, individual consumers cannot challenge the system, so a robust regulator is needed to stand in their shoes, but the CMA has lacked the tools to put the consumer centre stage, with its hitherto narrow focus on competition and process rather than practical outcomes meaning that consumer detriment goes unchallenged. So I strongly welcome the proposal for a new duty to make the economic interests of consumers and their protection from detriment paramount. This should always have been the objective, as any attempt to regulate markets should be to safeguard consumers. However, many regulators appear closer to the providers—the regulated community—than end users.

I have spoken in the House before about the Government’s Regulators’ Code which, as I recall, speaks of working with the regulated community but not with consumers. The National Consumer Federation’s Consumer Charter for Regulators is vital here. As it says:

“The main purpose of regulation is to promote and protect the interests of consumers … where market forces alone would not deliver the best outcome”.


So consumers must be at the heart of regulation. This is where the new CMA approach is brilliant, along with its focus on enforcement, including legal powers to order remedies, civil fines for individuals and, vitally, the disqualification of company directors for breaches of consumer law, which can already happen for competition law breaches. Just as consumers will pursue complaints only where there is the possibility of redress, company directors will prioritise compliance only where their own position is at risk—and potential disqualification is a meaningful risk.

It is no surprise that consumer representatives have welcomed these proposals, with Which? commenting:

“Giving the regulator … a duty to put consumers first will help tackle the imbalance of a system that … worked in favour of powerful businesses rather than consumers”.


Citizens Advice says the proposals are,

“strong stuff ... and great to see”.

Both groups’ eyes, however, are on the Government, who need to ensure that these proposals are swiftly implemented to protect consumers.

Consumer confidence in some markets is shockingly low, with only one-third trusting gas and electricity suppliers, the very markets supposedly overseen by regulation. These CMA proposals appear when the public hardly trust big providers or the machinery of the state to protect them. As the noble Lord, Lord Tyrie, says, the CMA proposals are,

“taking place against the backdrop of an erosion of trust”.

The Government should heed his warning. Without these changes, public dissatisfaction will only grow, so I urge the Minister today to give a positive response from the Government and an undertaking to act rapidly to implement these proposals.

Holiday Accommodation

Baroness Hayter of Kentish Town Excerpts

Tuesday 19th March 2019 Lords Chamber

[Lord Henley]

My Lords, like the noble Lord, I probably misread the Question, because I thought it was going to be about the matters that he referred to—I did not think we would be talking about food regulations in restaurants. But that is by the by. I agree with him, however, that one needs to be careful about the consumer comparison sites. It is an area that might need further regulation; it might not. At the moment, however, I think that such sites can help consumers compare costs of holiday accommodation—for hotel bookings or whatever.

[Baroness Hayter of Kentish Town (Lab)]

To follow that up, the CMA has finally done some really good stuff—started by this House—on things such as viagogo, and the fact that Google takes money to put things in a particular order. Will the Minister undertake at least to have a similar conversation with the CMA about what it can do about these comparison websites?

[Lord Henley]

My Lords, I think that the noble Baroness is referring to the investigation that the CMA launched in 2017 into accommodation booking sites. We are very grateful for the work that it has done. The investigation followed the CMA’s market study of online comparison tools. The CMA had its concerns and expressed them—about how a lack of clarity and accuracy in the presentation of information can mislead people. The important thing is that the CMA will monitor compliance with the commitments that the industry—the various booking sites—made, and I hope that, following that monitoring and having listened to any further advice that the CMA gives, the industry will take note. The CMA is clear that its advice should be followed.

Brexit: Consumer Protection (European Union Committee Report)

Baroness Hayter of Kentish Town Excerpts

Wednesday 16th January 2019 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

My Lords, I too thank and pay tribute to my noble friend Lady Kennedy for her committee’s report and for opening today’s debate. It has been a little unnerving, as it has exposed both the scale of the problems likely to be faced by consumers—even with a deal, let alone after a crash-out—and the paucity of the Government’s response; “platitudes” was the word used by the noble Lord, Lord Bilimoria.

I start with my regret about how the Government have disregarded consumers over the past two years, failing to engage properly with consumer bodies and representatives. I am sure that the Minister has been briefed that, as early as 13 February 2017, I had cause to write to his predecessor at the department, the noble Lord, Lord Prior, about the lack of meetings on Brexit with consumer representatives. Given that lack of engagement, on 22 March 2017, the chief executives of Citizens Advice and Which?, together with Martin Lewis of MoneySavingExpert.com, wrote to the Prime Minister stressing the importance of consumers to the economy and calling for a,

“cross-Government high-level working group focused solely on securing the best possible deal for UK consumers”.

Sadly, that never happened—and, despite my umpteen Written Questions, there has been no improvement.

Indeed, the last letter I had from the noble Lord, Lord Callanan, on 13 November, supposedly set out Ministers’ meetings with consumer groups. But when I looked, I saw that the list of 27 included discussions with the FCA, Ofcom, the BSI and some finance companies, as well as meetings with the CAB unrelated to Brexit. That is a poor record. In fact, there has been precious little involvement throughout the process, which is probably partly why the problems outlined today have been allowed to fester.

It is hard to know where to start, so great is the impact of leaving the EU on consumers, where, as we have heard this evening, the raising of standards and their effective enforcement have helped protect British consumers. Just as we can buy goods made in the EU, confident in the knowledge that they meet recognised standards, so too can our enforcement bodies—the CMA, trading standards and the police—share intelligence with equivalent bodies across the EU, while court judgments here can be enforced there and vice versa.

As we heard from the noble Baroness, Lady Burt, we touched on consumer rights enforcement last night. However, we did not mention that the local enforcement bodies—trading standards—have been halved since 2010, as the noble Baroness, Lady Burt, and my noble friend Lady Kennedy noted. CTSI warns us that it will be exactly those front-line trading standards which will have to unpick the uncertainties after exit and of course will have to carry out far more checks once we can no longer rely on safe products arriving from the EU. So will the Government now provide trading standards with the resources they need, as pressed by my noble friend Lord Anderson? Will they take steps to ensure that our enforcement agencies can continue participating in those EU consumer networks?

Half of the dodgy non-food products reported to RAPEX—the EU rapid alert system—concern motor vehicles. This is clearly serious, as enforcing standards is essential for road safety. However, the Government have not been clear on how they will ensure that cars do meet standards, given that eight out of 10 imported cars are from the EU. REACH, RAPEX and ANEC all facilitate data sharing, policy formation and enforcement. Loss of UK membership—and indeed, leadership, as my noble friend Lord Judd said—of these bodies will be drastic. It would be particularly sad in the case of ANEC, which represents consumers to the standard-setting bodies CEN and CENELEC—a point raised by the noble Earl, Lord Kinnoull. The chair of ANEC is a British consumer champion, Arnold Pindar, and it will be sad for ANEC as well as ourselves if the UK no longer participates. I have of course written and asked questions of Ministers about any ongoing role for the UK on ANEC—but they have gone unanswered.

Products will obviously pose a risk but so, too, will food safety. There is an immediate threat to food prices in the case of no deal, because tariffs will be imposed and a third of our food comes from the EU. There is also a threat to food safety, because outside of the European Food Standards Agency there will be reduced intelligence sharing and joint safety assessments. As I warned last night, the inane proposal that we just wave through lorries at entry ports in order to avoid road congestion is simply an open invitation for out-of-time or improperly labelled food products. So perhaps there will be more horsemeat in our lasagne and, if Mr Fox gets his beloved US trade deal, we can look forward to chlorinated chicken.

However, it is not only food that will be more expensive, as Which? has warned. In a no-deal exit, tariffs will be imposed on a range of goods, adding pressure to families already struggling with the cost of living.

While the focus of what we looked at was obviously consumers in the UK, the challenge of a no-deal exit for foreign travel will be enormous, let alone for the 1 million Brits already living in the EU who might suddenly find that they will need to take a driving test to get a Spanish or French driving licence once ours is no longer recognised beyond a holiday stay. Holidaymakers may need to revert to the old green card proof of insurance—which I think all of us in the House are old enough to remember—if driving abroad. We might also lose compensation for cancellations and delays.

I first wrote to the noble Baroness, Lady Sugg, on 5 February last year about whether UK citizens on an EU airline from a third country, or a UK citizen on a UK airline from a third country to an EU state, would still be covered by EU consumer rights legislation. Sadly, I have received no satisfactory reply and, since then, the threat of no deal has made compensation for any delays to or from the EU even less likely. Therefore, will the Minister set out the current position on this in the case of no deal?

As serious for travellers is that with no deal we will lose the EHIC, the European Health Insurance Card. Not only will that mean that our easy access to medical treatment will be at risk; older consumers—again, looking around the House—or those with pre-existing medical conditions will face real challenges in getting health insurance for travel in the EU. Can the Minister set out the Government’s plans to ensure that holidaymakers will still be fully covered across the EU in the case of no deal?

The UKECC, which everyone in this House will know stands for the UK European Consumer Centre, handles 16,000 cases a year and is partly funded by the European Union’s consumer programme. Perhaps the Minister can confirm the arrangements that his department is making to continue its role after March.

The Government’s own no-deal consumer rights paper fails to outline how consumer rights will be affected when buying from EU businesses. Indeed, there is a woeful lack of detail on how rights will be impacted, especially as the redress schemes will disappear. In fact, I maintain that UK consumers will simply have far less protection. It would perhaps have been a little more honest if the Government had made that explicit in the paper they published and had made some suggestions about how to mitigate the risk to consumers. Astonishingly, although the Government’s report warns businesses selling into the EU that they should keep apprised of future changes in EU regulations, it fails to offer any advice or support on how to achieve this. Both businesses and consumers must be updated by the Government, so some help on that would be of assistance. It is clear that the Government are not doing enough with either consumers or businesses, and that is clearly causing anxiety. Having listened to the Government’s radio ads, they are really content-empty, probably causing less rather than more clarity.

The recent Which? survey found that nearly two-thirds of the over-65s are worried about Brexit. Even among the 35 to 64 age group, there has been a dramatic rise of 25 percentage points since September 2016, with its “Brexit worry figure” now at 61%. Is it any wonder that consumer spending in December was down 1%—the biggest decline for over a year?

This House will recall that we passed an amendment to the withdrawal Bill to retain the Charter of Fundamental Rights, referred to by my noble friend Lord Cashman. A part of our thinking when we passed that was prompted by Article 38, ensuring,

“a high level of consumer protection”.

In sweeping away this objective in the way the Government have sought to do, I fear that they are sacrificing consumers on the altar of Brexit. It is a sad day after nearly half a century of improving consumer rights.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Henley) (Con)]

My Lords, I join other speakers in offering my congratulations to the noble Baroness, Lady Kennedy of The Shaws, on chairing the EU Justice Sub-Committee and on producing this report. I also congratulate her on chairing what the noble Lord, Lord Anderson, described as a happy committee. I congratulate, too, on all their work the noble Lords, Lord Anderson, Lord Judd and Lord Cashman, and the noble Earl, Lord Kinnoull, as I do the members of the committee who are not able to be here. When she goes away, the noble Baroness will, if nothing else, have the praise of her noble friend Lord Judd, who described her as someone who had views, and I am sure that all of us would echo that. All of us who have known the noble Baroness for some time know that she is certainly somebody who has views.

It is my pleasure, indeed my joy, to respond on behalf of the Government—it is late but we will, I hope, be finished by 10 o’clock. I welcome the focus of the committee, which has been on consumer protection. I am grateful to the noble Baroness, Lady Burt, for emphasising the very high standard of consumer protection that we have in UK law. It is useful to point that out. Maintaining and enforcing this protection effectively remains a government priority as the UK withdraws from the EU.

The report was published in December 2017, which, I accept, is now quite a long time ago. The Government responded in a timely fashion in February 2018, almost a year ago. I will not go through the response produced by my colleague Andrew Griffiths at that time. It is now on the record and has been referred to in the debate. I can only apologise for the fact that it does take time for some of these reports to get debated. It might have been the noble Lord, Lord Bilimoria, who said during this debate or the previous one that we have had time and should perhaps have used other evenings for debating some of these reports. These are matters beyond my pay grade, and for the usual channels. I apologise, but we are having the debate on this occasion.

What has been happening this week will not have escaped noble Lords. My noble friend Lady Williams referred to the old adage that a week is a long time in politics—this week somewhat longer than others, even though it is only Wednesday. In the context of this debate and the timing of the EU exit process, obviously things change; there are many questions to be answered on what will happen next. I am unlikely to be able to address them all in detail during my 20 minutes or so of winding up. What I can say is that the withdrawal agreement still offers a time-limited implementation period during which UK consumer protections based on EU law will be retained; this meets our main aim of an orderly Brexit delivering the stability and continuity that consumers and business both need and demand.

The terms of the future relationship will continue to be a matter—dare I say it, as colleagues have done on earlier occasions—for negotiation. We are aiming for high levels of cross-border co-operation on consumer issues as part of our new relationship with the EU. As a responsible Government, we continue to prepare proportionately for all scenarios. In order to minimise disruption, our preparations for a no-deal scenario are focused on maintaining continuity in the short term for businesses and citizens; for example, the Government have committed to funding the European Consumer Centre for at least one year in the event of a no-deal exit. Consumers will be able to contact this service for help and advice until at least March 2020. We have also progressed legislation under the withdrawal Act to ensure that consumer law will continue to function effectively after exit day.

As the Government made clear in our written response, we recognise the importance of effective cross-border enforcement co-operation and information-sharing systems in protecting consumers. I can reassure the House again that the Government are fully committed to negotiating the best possible deal with our partners to deliver this. We want UK consumers to be able to buy with confidence from traders in the EU, and vice versa. The way that consumer protections apply when buying cross-border in future, and how reciprocal arrangements would work, are a matter for the negotiations. The political declaration on the framework for the future relationship sets out that the UK and EU will work together to safeguard high standards of consumer rights.

I shall say a little about national regulatory and trading standards bodies. On the role of national regulators, the Government are working closely with stakeholders across the consumer protection landscape to ensure that enforcement remains effective after EU withdrawal. We work hard to make sure that national, regional and local enforcement is joined up. National Trading Standards supports its local colleagues in sharing intelligence and handling complex or wider-ranging issues that span local authority boundaries. The Government have also set up the Consumer Protection Partnership, which helps enforcers and consumer advice groups to work together to pool information, identify new issues and make the best use of their resources.

On funding, about which the noble Baronesses, Lady Burt and Lady Hayter, and the noble Lord, Lord Anderson, all expressed some concern, it is important to be clear about the different funding streams. Local authorities are responsible for their own finances and recruitment, and are accountable to their local electorate. That means that spending and resourcing decisions for individual trading standards are a matter for each local authority, and they will determine their own priorities. In addition, two national bodies, National Trading Standards and Trading Standards Scotland, have responsibility for prioritising and co-ordinating cross-local authority boundary enforcement. Combined funding from my department for those two organisations is just over £14 million per year in 2018-19, enabling serious regional and national level breaches of consumer law to be tackled effectively.

[Baroness Hayter of Kentish Town]

We were discussing not the national issues but rather local trading standards having to check local products. I think the Minister is saying that although there will be more checks, they are not going to make any more money available.

[Lord Henley]

My Lords, I have given the amount of money that will be available from central government for National Trading Standards and for Trading Standards Scotland. Obviously, as I made clear, other matters are a matter for local authorities.

I turn to engagement with stakeholders. We have continued to engage regularly with consumer groups, despite what the noble Baroness had to say, and we will continue to do so; we have recently had two ministerial round tables. The noble Baroness said that I would come with a briefing setting out a long list. She has received a letter containing our meetings with the appropriate authorities and she seemed to imply that most of those meetings were not adequate. She is right: I have come with a long list. I am not going to read through it all, partly because—I have to admit that this is my own incompetence—I see that the list that I have come with starts at the beginning of 2018 but only goes up to June 2018. There will be many more going beyond that.

The point that I wanted to make is that this is not just a list of Ministers from my own department, although they appear as well; there are Ministers from other departments such as DExEU, the DWP, Defra, the DfE and DCMS. Even the Treasury has been gracious enough to see people. I am sure that that will continue. I feel that we have engaged and will continue to engage in order to ensure that there is the appropriate protection in the right way and that we listen to everyone’s concerns.

I shall deal with some of the specific concerns raised in the course of the debate, starting with those raised by the noble Earl, Lord Kinnoull. I am grateful to him for alerting me to them, as they are very important. He wanted an update on CEN and CENELEC and what we intend. As I think he will be aware, the British Standards Institution, the UK’s national standards body, is independent of the Government, but we are working together to ensure that our future relationship with European standards bodies continues to support a productive and open competitive business environment in the UK. The members of CEN and CENELEC have agreed a transition period until the end of 2020, to resolve their membership criteria and find a form of wording that continues to include the BSI as a full member.

The noble Earl wanted an update on the efforts to achieve good civil justice co-operation and participation in the Lugano Convention. The political declaration on the framework for the future relationship between the EU and the UK provides a positive basis for discussions on this, and we remain committed to future co-operation with the EU on civil and commercial matters, recognising that it is in our interests to co-operate with international parties. The UK will continue to prioritise joining Hague 2005 in our own right and seek to accede to the Lugano Convention. The UK will engage with EU partners to ensure that these important issues, which provide essential protections for systems, are a focus of the detailed negotiations to come.

I also want to address some of the concerns raised by the noble Baroness, Lady Hayter, including those she alluded to last night when we were dealing with EU exit regulations, particularly the consumer protection regulations. She asked about information sharing and noted how vital it was for product safety and alerting other authorities. She asked whether that will continue and wanted assurances that we would retain access to RAPEX, the EU rapid alert system for dangerous non-food products. Information sharing with other countries is one of the most important ways that we can help to protect consumers from unsafe products and it is in all our interests that EU and UK market surveillance authorities continue to share information. Work is under way to explore options for maintaining information sharing across borders as part of our ongoing partnership. We will also ensure that the UK’s market surveillance system continues to be robust following our exit from the EU.

The noble Baroness also asked whether we would be just waving goods through to avoid congestion at the border. Again, I assure her that we continue to take the issue of consumer product safety seriously and are committed to ensuring that only safe products are placed on the UK market now and in the future. Our robust programme of risk-based market surveillance will continue to include the ability to intercept products as they enter the UK, check products already on the market and gather information through a variety of intelligence sources. If there is a no-deal exit, EU and UK product-safety legislation will be aligned on day one, and therefore we do not anticipate significant changes in risk initially. She also asked about EHICs—I think I have one of those cards in my wallet at the moment—and I will write to her about that, if I may, as I will have to take advice from the Department of Health and Social Care in due course.

The noble Baroness, Lady Kennedy, was worried that we would see a watering down of consumer rights after Brexit. I make it clear that we want to continue to maintain close co-operation with the EU on consumer enforcement, as I think I have made clear throughout my speech. We will seek to do that as part of the future economic partnership.

I accept that cross-border enforcement co-operation might become more difficult in the event of a no-deal exit, but we have retained all the necessary powers for our enforcement bodies to continue protecting consumers in the UK courts in cases of infringement of retained EU consumer law. The exact impact on consumers will be difficult to predict because the scale, nature and severity of infringements will vary. It will also depend on the degree to which UK and EU enforcers are willing and able to co-operate with each other. As I made clear, we will obviously continue to work with consumer groups and enforcers to monitor the impacts and to respond as necessary.

Lastly, I will touch on the Competition and Markets Authority, which the noble Baroness referred to, and whether it is prepared for a no-deal exit. We remain confident in the CMA’s ability to be ready for exit day. It continues to plan for such an outcome. BEIS continues to work closely with the CMA to ensure that that is the case. As the noble Baroness will remember, in the Budget back in autumn 2017, I think, my right honourable friend the Chancellor committed £3 billion over the next two financial years to help departments, which includes the CMA and the devolved Administrations, prepare for the UK’s exit from the EU. The CMA is recruiting additional consumer protection staff, which amounts to a 25% increase in its capacity in anticipation of more complex cross-border consumer protection work. The vast majority of those roles have now been filled.

I hope that I have dealt with most of the questions. As I said to the noble Baroness, Lady Hayter, I will write to her on her question about the EHIC. If I find that there are other matters that I need to write on, I will do so. I again thank and congratulate the noble Baroness on—as the noble Lord, Lord Anderson, put it—her happy sub-committee. I thank and congratulate all those who participated in the debate and give the assurance that continued effective consumer protection and enforcement after EU withdrawal remains a priority for Her Majesty’s Government.

Consumer Protection (Enforcement) (Amendment etc.) (EU Exit) Regulations 2018

Baroness Hayter of Kentish Town Excerpts

Tuesday 15th January 2019 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

My Lords, I think everyone else on our Benches has gone away to celebrate, and we will join them soon. While thanking the Minister for setting out the reasoning behind these regulations and their purpose, I find it deeply regrettable that we have come to this: having to legislate to take away the protection of consumer rights simply because the Government have so miserably failed to negotiate a withdrawal agreement acceptable either to this House or—as we have now learned—to the other place.

Ministers are therefore threatening to crash out of our near half-century relationship, with all the rights and benefits that have accrued to consumers over that period—threatening no deal in an attempt to persuade MPs to vote for their inadequate deal. As we have seen, it did not work.

Meanwhile, the Government pursue these no-deal regulations, each and every one of which does two things. First, they show how much we have gained from and depend on our close working relationship across the EU, not only in trade but in all those associated areas, be it the recognition of legal judgments or—as in this case—the cross-border protection of consumer rights. It is an issue which, sadly, has been lacking throughout the Government’s approach to Brexit. We will have a longer debate on that tomorrow, when the Minister will also be replying, so perhaps I will just give him notice of one of the things I shall say then, which is to note the shocking failure of Ministers over two years to engage with consumer bodies and their representatives during their process of considering Brexit.

Secondly, the SIs do not only show how closely we have been intertwined with the EU; they are also testament to the disaster any no-deal exit would bring, because, literally overnight, long-standing protections would disappear. Consumers would feel this more than anyone else because it will happen immediately. The suggestion has been made, not by the Government but by some of their supporters, that somehow it would be a good idea to just wave through imports at our borders, particularly at our ports, to save congestion in Kent. That may be fine for the roads of Kent, but waving throughout unchecked lorries will mean we very quickly see shoddy, fake or unsafe goods in our shops, because we will lose all the protections that prevent that happening, and it will be consumers who pay the price.

So the regulations before us are a pitiful example of what will face us should we crash out on 30 March. As we have heard, what they show is that, with no deal, key consumer protection enforcement bodies—particularly trading standards and the CMA—will no longer be part of that absolutely essential cross-border network whereby rogue traders, rip-off companies, cartels and the makers of shoddy goods and services can be brought to book, as they can at the moment, by sharing intelligence and by pan-EU enforcement.

No matter what the Government say, consumer protection will be weaker. All these mechanisms have allowed trading standards bodies to alert their professional equivalents across the other 27 countries in the EU about unsafe products or traders, and to ensure that evidence found in one place can be used in another jurisdiction. That means that courts in one country can tackle a business located elsewhere, which is often the case when a consumer is buying something made in a different country. But under no deal—the outcome this House found unacceptable last night—our domestic enforcement authorities will no longer benefit, on behalf of consumers, from all those reciprocal arrangements and rights now granted under EU law. That is a big loss for our consumers.

But strangely and inexplicably, because of this self-injury to our consumers, the Government have decided, via these regulations, to similarly harm EU consumers by ending the requirement on our enforcement bodies to help other EU states in the interest of their consumers. They have made it voluntary rather than a requirement. That was never necessary. No rationale was given for this. Just because we have chosen to harm our consumers by leaving, I do not see why we are also willing to harm consumers in the other countries.

Furthermore, that was a policy decision. It was not automatic because of our exit. It was a policy decision to end our assistance to consumer bodies elsewhere, and therefore it was absolutely correct that our scrutiny committee insisted on this being an affirmative measure, because it is a policy and not an automatic decision. I hope there will be no further attempts to disguise policy decisions being taken by seeking to slip them through as negative orders.

Perhaps the Minister could explain the rationale for this mean-spirited decision. It is our Government—or even our people—who voted to come out, so why on earth should we make EU consumers pay the penalty? Could the Minister also explain why there has been no impact assessment for this measure? It is a vital measure for consumers and they will feel the impact, as will SMEs. They will have to do more of the checking which thus far they have not had to do because they have relied on any product coming from across the EU being safe to be sold here. Also, the cost will be paid even more by trading standards, not only because they will be hampered in their enforcement, but because they will have to do those checks on products arriving which currently they do not have to do. That should have been in the impact assessment.

Inexplicably, the Explanatory Memorandum says that the regulations will have an impact of less than £5 million. First, I do not believe it. Secondly, how on earth do the Government know without doing an impact assessment? Did they even contact trading standards to find out the impact on them of extra checks? Did they look at the costs where consumers are harmed and therefore compensation has to be paid? Did they look at the impact of enforcement taking longer when the intelligence is missing? Or is it simply that the Minister’s department does not really care too much about consumers?

In the same context, what assessment was made of the cost of the extra checks at borders once we can no longer rely on intelligence from trading standards abroad? We heard it said in the debate yesterday, “Don’t worry about the extra checks, because the checks at our border are done on a risk basis”. That means that they are done on the basis of intelligence. The moment that we take out intelligence, we lose our basis for a risk assessment, so the idea that there will no extra checks at the border is absurd. A little clarity from the Minister would be appreciated. The loss of access to these consumer protection networks is bound to be bad for consumers. It would have been more honest had the Government acknowledged this.

I have one further question for the Minister. This statutory instrument is supposedly “contingency planning” for no deal, but can he detail the Government’s intentions for the whole of the UK’s consumer regime should we leave in a slightly more ordered way with a deal? We would like to know something about the timing of the SIs that will be needed also for those circumstances.

[Lord Henley]

My Lords, I thank both noble Baronesses for their comments, particularly the noble Baroness, Lady Hayter, for reminding me that we would deal again with these matters tomorrow and that I might want to respond more fully at that stage. After considering things overnight, it might be that I deal with just a few more of the noble Baroness’s points in that debate on the report from the Select Committee—a debate which, dare I say it, will happen somewhat later than tonight’s.

The noble Baroness, Lady Burt, raised a number of questions. She started by asking how many statutory instruments were coming from the department, how many were drafted and when she would see the figure. I regret that I do not have the figure in front of me, but I think virtually all of them are now drafted and on their way through the process. I think we will be able to get them ready in time for 29 March. I look forward to discussing those and others with her, the noble Baroness, Lady Hayter, and other noble Lords as they come before us. I will continue to write to the noble Baroness or her noble friend, depending on whether I can work out who is dealing with each SI—but I am sure that they manage to exchange letters perfectly well—just as I wrote on this occasion to the noble Lord, Lord Stevenson, who no doubt passed on that letter to the noble Baroness, Lady Hayter.

The noble Baroness asked also about the EU consumer centre and what our plans were. I am grateful to her for repeating what a good job it did and saying that it will continue to operate until March 2020. At this stage, all I can say is that we have made no final decisions, but we will review that over the coming year. Again, I will make sure that the noble Baroness is kept informed in the appropriate manner.

On engagement, I can give the assurance that discussions were held with the Competition and Markets Authority, members of the Consumer Protection Partnership, Which?, MoneySavingExpert, the devolved Administrations, the Government of Gibraltar, the Crown dependencies and other government departments with direct responsibility for the laws in the annexe to the CPC regulation. The related competent authorities were also consulted. That engagement was as wide as is appropriate.

The noble Baroness, Lady Hayter, will be aware that it is not necessary to publish a full impact assessment for this SI because it qualifies for the de minimis exemption. The de minimis exemption from a full impact assessment applies where the expected net direct impact on businesses is no more than £5 million per year. It is also important to note that, in assessing impact, we are considering the effect of the SI in question rather than the wider impacts of EU exit. These regulations are designed to correct the deficiencies in legislation after exit to maintain the status quo as much as possible. Therefore, the expected impacts are small. To form the assessment of likely impacts, the department has engaged in informal partnership with the Consumer Protection Partnership.

[Baroness Hayter of Kentish Town]

I still do not understand how the figure of £5 million has been reached.

[Lord Henley]

I am not sure that I can give from the Dispatch Box a precise breakdown as to how we reach those figures. This is general guidance on all impacts in that we look at the effect on business; we make an estimate, and if it is below £5 million—this has been in existence for some time—we do not publish an impact assessment. That is a standard procedure. I will write in greater detail to the noble Baroness setting out how we do that.

I hope that I can say a little more tomorrow, because it goes wider than this SI, in response to the question asked by the noble Baroness about extra checks at borders. I think that would possibly be more relevant to that debate.

Finally, I will deal with the question from the noble Baroness, Lady Burt, relating to Schedule 13 infringements and how they differ from Community infringements. A Community infringement is a breach of the EU regulations and directives—specified in the current Schedule 13 to the Enterprise Act—as implemented by the EU member states. A Schedule 13 infringement is contravention of retained EU law that will form part of UK law post exit and thus will deal with breaches of national law. I hope that explains the issue. If not, I will no doubt receive a prod from the noble Baroness and be asked to write in further detail.

I believe I have dealt with the questions that relate to the instrument; others, as I have said, possibly went wider and might be addressed in our debate tomorrow, which I look forward to with enormous pleasure. Again, I remind the noble Baroness and possibly the noble Baroness, Lady Burt, who will also be speaking, I think, that we might be at a somewhat later hour, as there are two debates beforehand, both of which seem to have attracted a reasonable number of speakers. I commend these regulations to the House and I beg to move.

Brexit: Fashion Industry

Baroness Hayter of Kentish Town Excerpts

Thursday 15th March 2018 Lords Chamber

[Lord Henley]

My Lords, sadly, I missed that, but I am very grateful to my noble friend for bringing it not only to my attention but, more importantly, to the attention of the House.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, as a dedicated follower of fashion—that gives away one’s age, does it not?—I would add that although the IP itself is important, we also need our lawyers to continue to represent any of our designers when they appear in courts in other countries. We also need the models and others to be able to move across borders so that they can perform or show their wares. Will the Minister give some assurance that, in the discussions on Brexit and the ability to move for work, this will be uppermost in their minds?

[Lord Henley]

Yes, my Lords, we will take the point about lawyers into account, and I will make sure that the noble Baroness’s concerns are brought to the attention of my honourable and right honourable colleagues. As regards others such as models moving abroad, I think that there will probably be no problem whatever, because there will be a particular attraction to making sure that English models and all others involved in the fashion industry are able to work in Europe and sell their wares.

Brexit: Women in the Workplace

Baroness Hayter of Kentish Town Excerpts

Tuesday 16th January 2018 Lords Chamber

[Lord Henley]

My Lords, while we are in the EU we will obviously continue to take a constructive approach to the various Council working groups, in particular that which the noble Baroness referred to on the new work/life balance directive, and we will seek to ensure that the text is appropriately clarified. We look forward to continuing discussions under the Bulgarian presidency. I am not going to make any commitments about what we will decide to do about different parts of that work/life balance directive, but we will certainly continue those discussions, and if we are part of the EU we will sign up to it, if appropriate. If not, these are decisions for ourselves.

[Baroness Hayter of Kentish Town (Lab)]

My Lords, one eminent equalities lawyer has said that the failure to bring across the charter of fundamental rights into UK law would mean that the free-standing right to equality will have no equivalent in domestic law, so we would lose one of the fundamental standards underpinning the other regulations being brought across in the withdrawal Bill. Given that we have heard that the new Brexit Minister in the other House wants to get rid of such rights anyway, what comfort can this Minister offer to women that their right to equality will not be weakened?

[Lord Henley]

My Lords, one eminent lawyer has made that statement, but not all eminent lawyers agree with it. We are fully signed up to human rights and will continue to be fully signed up to all other aspects of human rights. Leaving the EU does not make any difference in this matter.

Euratom

Baroness Hayter of Kentish Town Excerpts

Thursday 20th July 2017 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

My Lords, we owe quite a debt to the noble Lord, Lord Teverson, for his earlier work on this and for today’s debate and the way in which he introduced it. However, I have to confess that I do not know how many such representations the Government have to receive before they realise that they have made a big mistake over Euratom, the unified European nuclear safety—the clue is in the word “safety”—and non-proliferation regime.

There have been protests—I have had them; I am sure that the Minister has had them, too—from the nuclear industry, the pharmaceutical industry, scientists, oncologists, the Bioindustry Association and the supply agency producing technetium-99m for cancer treatments and diagnosis. We have heard from specialists concerned about future supplies of medical isotopes, given that many of the reactors producing them are coming to the end of their lives. We have heard from a leading German politician, from the BMA, from the Institute of Physics, and umpteen warnings about a shortage of skilled staff and the loss of our world-leading fusion project and all the scientists and support staff who go with it.

I have just received a rather heartfelt plea from a certain Bob Kaufman, a retired diplomat who, in 1966 in our Paris embassy, drafted the language adopted by Washington and incorporated into the NPT which exempted the technically sophisticated Euratom safeguards from IAEA inspection procedures and therefore exerted political pressure on France under de Gaulle to accept Euratom rather than the American bilateral or IAEA safeguards. Mr Kaufman says:

“US-Euratom co-operation in the peaceful uses of nuclear energy established a model for worldwide efforts begun by President Eisenhower and pursuant to the Non-Proliferation Treaty. It would be a shame should Britain unnecessarily damage itself and one of Europe’s enduring and quietly successful entities”.


It is quietly successful. That is perhaps why, as the noble Lord, Lord Teverson, said, few of us had heard of it until this happened.

There is cross-party concern on this, including from the noble Lord, Lord Hayward, who, though he cannot be here today, asked me to emphasise that concerns about the Government’s handling of this issue do not come solely from Opposition Benches. He, like others who spoke in the earlier debate, responded positively to the offer made by the noble and learned Lord, Lord Keen, on that occasion to meet Peers on this. I wrote to the noble and learned Lord about that on 17 March and got a reply on 22 June from the Minister in the Commons, who was keen to go ahead with such a meeting before the Summer Recess. That gives him about three hours to get us all together.

The question is why the Government are taking us out of Euratom despite all the evidence. As the noble Lord, Lord Wallace, said, we know that it is due to their willingness to allow their inexplicable hatred of the ECJ to colour every aspect of our withdrawal from the EU. In this case, that puts our lives, energy, safety and science at risk, just so that we can escape a court—one comprised of judges whose job is to interpret the law. We had been given to understand by something in the Guardian that the Government might seek to replicate the benefits of membership through some form of associate membership, but in the Commons the Minister appeared to dismiss this possibility and brushed aside the main concerns raised, especially as regards medical risks.

My noble friend Lord O’Neill had to leave for his plane, but he was going to say—I hope that I can use a minute to say it—that he is receiving treatment for prostate cancer at the moment. He reminded me that, although I will never get that, many in this House are likely to. He asked how long patients will have to wait for the security that their treatment will go ahead, given the fear of not having those nuclear materials. So my plea to the Minister is to act now, to get all those industries, the medics, scientists and everyone on board, and have a concerted effort to find a solution. It must be operative by March 2019. We cannot risk delays of vital nuclear material at ports because checks are being made. They are perishable as well as vital goods. We cannot risk being outside this world-leading nuclear co-operation system. I hope that the Minister will not allow some hang-up over the ECJ to blind the Government to a sensible way ahead. Together, I am sure we can work it out—but the Government must take a lead.

Taylor Review of Modern Working Practices

Baroness Hayter of Kentish Town Excerpts

Tuesday 11th July 2017 Lords Chamber

[Baroness Hayter of Kentish Town (Lab)]

I thank the noble Lord for repeating the Statement on the review of modern working practices. We all look forward to studying it carefully and working with all concerned to respond to these new ways of working, as over time we have done with the invention of printing, photocopying, computers, mobiles and the internet. Working together we can make new technology and changing demands work for the whole of society.

However, I fear that the Government’s Statement looks only at two parts of the market: workers and business. There is in fact a vital third limb: the consumer or customer. I happen not to use Uber, one of the best known of the gig institutions, but many consumers do, including women, who often do not like to hang around on street corners trying to hail a taxi and who appreciate not having to carry cash in order to hire a cab. But it is not in their interest for a driver to be overtired, unwell or underinsured, and at work only because of pressing economic needs. Consumers need to feel safe, with a driver who is fit and healthy, awake and concentrating, and not worrying about their next fare; and they want to know that the driver is getting a fair day’s pay for a fair day’s work.

Other parts of the gig economy may not have face-to-face consumers in the same way, but all have customers of the firm’s business, who similarly need to be assured of the quality of the work, which is highly dependent on the motivation and decent conditions of what the report calls “dependent contractors”. It is true that contented workers make for higher-quality work. So as the Government digest the report, will they involve the consumers and customers of such services in addition to the other key players?

Will the Minister also undertake to involve trade unions fully in this work, which would help the Government as well as the people concerned? Traditionally, of course, vulnerable and exploited workers have had their standards raised and their rights protected through the intervention of trade unions. But as we know, for obvious reasons workers in these sectors are a real challenge to recruit. There have been other similar areas in the past where wages councils played an invaluable role. While I hope that the unions will seek to represent this group, we should be realistic and acknowledge how difficult that is and therefore we need other avenues for unions to be able to speak on behalf of these workers. The report calls for additional protections for gig workers and greater incentives for firms to treat them fairly, including through strong employment relations, but this will need trade union input. I hope that the Minister can give a clear assurance that this will happen.

I want to make one other point. The report does little to strengthen the ability of workers to enforce the rights they already have, beyond shifting the burden of proof in one case when determining the employment contract. The Minister and this House know that the level of employment tribunal fees is a real barrier to justice, so we will continue to press for the fees to be abolished. The Minister has repeated the commitment to workers’ rights, but without their ability to enforce them through tribunals, those rights are really just pieces of paper. It is in no one’s interest for this group to be exploited, but it will need a commitment on the part of the Government to ensure that that does not happen. This is an important area for the future of the economy, for the workers concerned, and for us as consumers.

At first read—and it is only a first read—the report does seem to be somewhat tame and appears to be a missed opportunity to grasp the challenge looking forward to the rest of this century of the contribution that the gig economy can make. The Government need to take up the challenge of grounding in the expectations of all employers the need to treat this group of workers fairly and preserve their rights. We will be looking to the Government to work with all stakeholders to ensure that the change in culture as well as regulation will ensure that this part of the economy is fair for all concerned.

[Lord Fox (LD)]

My Lords, this report is welcome as it frames the need to reconsider working conditions in a clear manner. I should like to quote from it that,

“while having employment is itself vital to people’s health and well-being, the quality of people’s work is also a major factor in helping people to stay healthy and happy, something which benefits them and serves the wider public interest”.

This is an important and true statement that we should bear in mind when considering not only this report but the wider realm of employment and industrial strategy. We are living in a time of huge change in the world of work, so the Prime Minister was right to ask Matthew Taylor to carry out an independent review and produce a report. As noble Lords will have noted when I dropped it just now, the resulting document is comprehensive and hard to absorb in the short time we have had to do so.

The Government’s Statement points out that the report highlights the need to deliver additional protection to the increasing number of people we describe as platform-based, or rather, what we know as the gig economy. The most important distinction to make is between the creation of a new group of workers or dependent contractors and those who are truly self-employed. While this may seem to be tame to some, it is starting to move down the road of classifying people in a way that enables them to have the rights they deserve. So it should be no surprise that the Liberal Democrats broadly welcome the recommendations in the Taylor review. The right to request fixed hours and employment rights for those who are now classified as dependent contractors was set out in the Lib Dem manifesto, so obviously we support that. If enacted, it will provide additional protections for this group as well as strong incentives for firms to treat these workers fairly. It is clear that these rules will have to be backed up by policing. That will improve workers’ rights in the gig economy while maintaining flexibility for those who want it, and that is the key. Some people want flexibility, but others have it thrust upon them. Noble Lords may remember that the Government opposed these proposals during the coalition Government.

We should also remember of course that workers’ rights are ultimately underpinned by EU law. This is backed up by the UK’s ability to create and protect high-quality jobs, which in itself is dependent on the UK being part of the single market. As noble Lords would expect me to say, under Theresa May’s Brexit plans we will continue to see falling real wages and slowing economic growth, and jobs will begin to fall back. This is bad for all workers but it is worse for these workers. Furthermore, there are some people—including on the Benches opposite—who will seek to use Brexit not to strengthen workers’ rights, but to weaken or even abolish some of them.

That is why it is important for the Government not to get bogged down in this report and to move swiftly. The Minister has pledged to respond by the end of the year. We look forward to the industrial strategy and how that will play into this. We believe it is important that the Government proceed rapidly to a conclusion that accepts the clear direction of this report and brings forward proposals that will enact its substance. The longer the Government delay, the longer this important and growing band of workers will be deprived of justified employment rights. The longer the Government delay, the more suspicions will be raised that Brexit will be used to water down people’s rights. As the report says:

“All work in the UK economy should be fair and decent with realistic scope for development and fulfilment”.


We hope the Government accept that point and bring forward rules and laws that help to bring it about.