Clause
11
Advice
and research functions of the Consumer
Panel
Mr.
Djanogly:
I beg to move amendment No. 222, in
clause 11, page 5, line 10, after
‘Board’, insert ‘or on its own
initiative’.
The
Chairman:
With this it will be convenientto
discuss amendment No. 223, in clause 11, page 5, line 16, at end
add—
‘(4) In acting on its
own initiative under subsection (1), the Consumer Panel shall not
impose any costs on any of the approved
regulators.’.
Mr.
Djanogly:
We propose to insert the words
“onits own initiative” on a probing basis. The
proposal comes from current consumer bodies. The wording of clause 11
will permit the consumer panel to carry out research for the Legal
Services Board and provide it with advice when it so requests. The
amendment would enable the consumer panel also to carry out research
and give advice to the board on its own
initiative.
The
amendment aims to ensure that the consumer panel has an active and real
purpose. It suggests that the panel should be given some independence
and the opportunity to investigate matters and pass on relevant
findings and associated advice without having to wait to be asked by
the Legal Services Board. That would enable the system to become far
more dynamic and less
static.
We are, of
course, aware that such increased freedom on the part of the consumer
panel will lead to further costs. As we have indicated in earlier
amendments, the Conservatives are keen to ensure that such additional
costs are not passed on to the regulators. It would be
unjust to make them pay for research carried out by the consumer panel
on its own initiative on consumers’ behalf. Therefore, we
suggest that an additional amendment be made—amendment No. 223,
which is
self-explanatory.
Simon
Hughes:
My hon. Friend the Member for Birmingham, Yardley
and I have added our names to the amendment. We are strongly persuaded
that it should be introduced. It is consistent with practice in other
regulatory bodies with a consumer panel. I gather that Ofcom’s
consumer panel has the power to carry out research into any relevant
area that it sees
fit.
If we are to get
good people to serve on the consumer panel, one of the things that they
will want to know is that they are free to set their own agenda rather
than having it set for them. The hon. Member for Huntingdon and his
friends realised that there is a cost implication, and I thought that
where that might fall would be left for the discussion. There is a
potential cost implication, although the consumer panel will have a
support system. It will take additional time if the panel decides that
it must assess what it ought to do as well as what it is asked to do
and work through the programme, so it is appropriate to debate where
the additional cost will fall. Perhaps amendment No. 223 is the right
proposal; it may be something else, but my hon. Friend the Member for
Birmingham, Yardley and I are clear that the panel ought to have the
power to take initiatives. I hope that the Minister is entirely signed
up to this pro-consumerist amendment.
Mr.
Bellingham:
I also endorse what has been said. As my hon.
Friend the Member for Huntingdon pointed out a moment ago, the consumer
panel must have direction and focus. It would be wrong for it to be
purely a reactive panel. It must be proactive. Let us consider the
various disasters that have taken place in respect of how the consumer
is affected by a legal action—indeed, the hon. Members for
Bassetlaw and for North Durham know well that it would have been useful
if the consumer panel had been in place when case of the miners’
compensation scheme was going on, as it could have taken up the cudgels
on behalf of the people who were afflicted by that appalling, ghastly
saga.
John
Mann:
The hon. Gentleman is quite wrong.The last
thing that I wanted was a body into which complaints could have been
palmed off. I wanted—and want—effective regulation. Is he
not in danger of going down the track of beefing up the consumer panel
to such an extent that it can handle all the consumer issues and the
Legal Services Board can wash its hands of
them?
Mr.
Bellingham:
I very much disagree with the hon. Gentleman,
because they can work in tandem. Of course, we want tougher, better
regulation of the solicitors, but that is separate from giving
consumers a greater voice. If consumers feel that they have suffered a
serious grievance, whatever action the consumer panel might take might
well prompt the Legal Services
Board to take regulatory action against particular solicitors. The two
can work in tandem.
As far as commissioning
research is concerned, I, too, considered the case of Ofcom. If one
widens the remit of the consumer panel in such way, it will attract a
higher calibre of members and will build up a body of research opinion
that will build credibility over the years. The Bill is about improving
the way in which legal services are run, and they are run for
consumers—our constituents. What would happen if outside
consumer bodies wanted to help the consumer panel with research
programmes? For example, if the National Consumer Council or Which?
decided that it would be sensible for the consumer panel to consider
research programmes and wanted to work with it and, perhaps, to help
sponsor research, would that be in order?
My hon. Friend the Member for
Huntingdon andI are concerned about the cost implication. If
the consumer panel builds up a huge amount of momentum and wants to
take on many new challenges, there will be a cost implication and that
is why we have had to qualify matters. We did not want the provision to
become an open-ended commitment. We are conscious that the Minister and
her colleagues are in a Department that faces financial constraints. We
do not want to put too much financial pressure on her Department, but
we also want the job to be done. I urge her to consider the possibility
of using some outside resources if particular projects have merit and
if the panel is proactive in a campaign. I hope that she will consider
that and support our
amendments.
Mr.
Jones:
I find it very strange that on the second day of
our consideration, Conservative Front Benchers are talking about the
rights of the consumer. Up to now, they have been trying to protect
their vested interests, and the amendments are another
attemptto do that. Like my hon. Friend the Member for
Bassetlaw, I am concerned that if we are not careful the consumer panel
will end up in competition or rivalry with the board. That would be a
dangerous step, because it would weaken the role of the board. Such an
approach is not inconsistent with Conservative policy these days, under
which policies are put forward with no attempt to explain how they will
be paid for. If we accept amendments Nos. 222 and 223, it is not clear
who will pay for the research—as long as it is not the poor
solicitors or the legal profession, who, poor as they are, could not be
asked to contribute anything to such research. I resist the amendments.
They have been portrayed as an attempt to help the consumer, but they
are actually part of a cynical guise around an attempt to protect the
vested interests of the legal profession.
Simon
Hughes:
The hon. Gentleman has not thought this through at
all. The Government propose in the Bill that there should be a consumer
panel; the hon. Gentleman seems to be arguing against not only the
amendment, but the idea of a consumer
panel— [Interruption.] Well, that was the clear
implication; if I am wrong, what he said was not very clear.
It is fundamentally important
that there shouldbe a consumer panel and that its
representatives donot sit—with formal status, as it
were—as a non-departmental public body such as the Legal
Services
Board. Those representatives should be able to make sure that there is
an access point and response base for consumer issues. The amendment is
consistent with the idea that there should be a consumer panel. If
there is to be one, we should let it do its job, not hold it
back. 10.15
am
Robert
Neill:
I often find myself agreeing withthe hon.
Member for North Durham—on local government issues, for example.
However, I am sorry to say that he is absolutely wrong on this issue.
There seems to be an extraordinary illogicality to his
position.
I rather
resent the suggestion that the Conservatives have ever objected to the
notion that the consumer is at the heart of the Bill. Perhaps the hon.
Gentleman has spent so many years in the Labour party and trade unions
that he has become an inveterate conspiracy theorist. We are talking
about not a conspiracy todo down the consumer interest, but a
proposal to advance it.
I am sorry to use an analogy
from another piece of legislation, but it is apposite. During the
passage of the Local Government and Public Involvement in Health Bill,
we debated how we would make local involvement networks, or LINks,
effective—how we would give them teeth and attract people of the
right calibrewho would be an effective voice for patients. The
Government seemed to accept that there was a need to empower LINks.
That is what we are trying to do for consumers in this context: to
empower the consumer panel. That is consistent with the
Government’s own philosophy of the Bill. We accept that point,
so I find it bizarre that Labour Members should try, by using rich
lawyers as a smokescreen, to limit the scope for consumer panels to
carry out research on their own initiative.
I know lawyers who do legal aid
work, and they have seen not an increase, but a real-terms cut in their
fees over the years. They do not necessarily come into the “rich
lawyer” category. It would be very sad if, of all people, Labour
Members started to stereotype. That would get us away from the real
issue of trying to geta balanced regulatory framework, which,
I accept, involves enhancing the position of consumers. It also
involves respecting the position of the professionals. Enabling the
consumer panel to take the initiative is to go in absolutely the right
direction, not the wrong
one.
Bridget
Prentice:
I have some sympathy with the arguments that
have been advanced in so far as I agree that representations from the
consumer panel will be hugely important in informing the
board.
To ensure that
the panel is equipped to do its job, we have provided that it must be
consulted by the board in respect of certain key regulatory activities.
The panel may also make representations to the board about any other
matter. When it does so, the board must consider them and give the
panel notice if it disagrees. Any such notice must state the
board’s reasons for disagreeing with the representations. If it
wishes, the consumer panel can publish any information relating to the
provision of its
advice.
I turn to how
that might work. If the panel considers that there is evidence of a
clear detriment to the consumer interest, it may make a representation
to the
board that it request that the panel carry out research into the matter.
Such a representation could also specify that the board should receive
and consider advice from the panel. If the board elected to disagree
with such a representation, the panel would have to be provided with a
justification for that disagreement, and it could then go ahead and
publish that
exchange. Amendment
No. 222 would allow the panel to conduct research of its own volition.
A number of hon. Members have prayed in aid other consumer panels, but
they are labouring under a misunderstanding of the role and powers of
some of those other panels. Ofcom’s consumer panel can provide
advice of its own volition, but only in very specific circumstances
under section 16(3) of the Communications Act 2003. As far as I am
aware, neither the Financial Services Authority nor Ofcom consumer
panel have the power to undertake research of their own volition. I do
not know of any other statutorily provided consumer panel having that
ability.
In the Bill,
we have given the consumer panel more powers than those available to
others. In fact, I would argue that Ofcom’s consumer panel is
more restricted in its ability to carry out research than the panel of
the Legal Services Board.
Amendment No. 223 states that
the cost must not fall on the approved regulators. In that case, on
whom must it fall? If the implication is that it would fall on the
Government, in effect, that means the consumer. In fact, the Bill
states that, after the transitional period in which the Government
contribute to the cost, the Government will play no further part. It is
for the legal profession, which is to be regulated, to bear the burden
of that cost. Therefore, even if the amendments are accepted, it is
inevitable that the cost will fall on the legal profession.
Amendment No. 223 is
problematic because it does not indicate who should bear the costs. I
understand what it seeks to do, but the amendment is flawed in itself
and in its principle because the implication is that the cost will fall
on the consumer. In fact, once the board is up and running, the costs
will fall on those who are being regulated.
When the board identifies an
area that needs regulatory scrutiny—or a representation has been
made by the panel that identifies such a need—it is important
that the panel is available to undertake that research and to advise
the board on the potential impact on consumers. There would be a real
danger that the panel might be unable to honour that request if it is
dedicating time, manpower and other resources to research projects of
its own.
Finally,
there are no safeguards in the amendments to ensure fairness or to
prevent misuse of power. Nothing in the amendments would stop the panel
from conducting irrelevant research, incurring exorbitant costs, or
providing that the board need not act on the advice. The amendments
contain no clear lines of accountability. They are flawed in themselves
and in the principle that they are trying to express. On that basis, I
ask the Committee to reject
them.
Simon
Hughes:
The hon. Member for Huntingdon will make his own
decision but, unless I am mistaken, I detect a bit of resistance from
the Minister. Some of
her arguments are good, although some facts need checking. I am not
persuaded by her arguments, but I am happy to consider them further. If
the amendments contain flaws, I am sure that that we can improve
them.
Mr.
Djanogly:
As the hon. Member for North Southwark and
Bermondsey says, we are not convinced by the Minister’s
argument. My hon. Friend the Member for Bromley and Chislehurst was
right to say that the Conservative party is concerned about the rights
of the consumer. I echo that remark. Many amendments tabled by
Conservative Members that we have discussed so far have been in the
interests of the consumer. Sometimes they have questioned who the
consumer is and sometimes they have examined how
the existing Bill has been adapted, but they have certainly considered
the rights of the consumer from the consumer’s point of
view.
Once the hon.
Member for North Durham had got over his fixation with vested
interests, he suggested that the board and the panel would come into
conflict. I thought that my hon. Friend the Member for North-West
Norfolk
answered—
The
Chairman:
Order. I make a further plea for forgiveness for
my misunderstanding of the starting time of our proceedings this
morning.
It being
twenty-five minutes past Ten o’clock,
The
Chairman
adjourned the Committee without Question put,
pursuant to the Standing
Order.
Adjourned
till this day at One
o’clock.
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