HC Deb 17 December 1964 vol 704 cc547-54
16 and 17. Mr. Dodds

asked the President of the Board of Trade (1) what study he has made of the information supplied to him by the hon. Member for Erith and Crayford concerning a company with a head office in London and branches in many parts of the country; and if he will hold an inquiry into its activities:

(2) what representations he has received regarding the contracts supplied for signature to prospective customers of a company of whom details have been sent to him by the hon. Member for Erith and Crayford; and if he will introduce legislation to control the types of contracts which the public may be asked to sign.

21. Mr. Hamling

asked the President of the Board of Trade if he is aware of the concern arising from the methods employed by a company, details of which have been forwarded to him by the hon. Member for Woolwich, West; if he will cause an inquiry to be held; and if he will make a statement.

22. Mr. Carter-Jones

asked the President of the Board of Trade if he is aware of the concern arising from the practices employed by a company with branches in many parts of this country, details of which have been supplied by the hon. Member for Eccles; and what action he proposes to take to protect the public from exploitation.

24. Mr. Iremonger

asked the President of the Board of Trade if he will institute an inquiry into the sales promotion practices of the organisation with a branch in Ilford, details of which have been sent to him by the hon. Member for Ilford, North.

30. Mr. Robert Edwards

asked the President of the Board of Trade if, following consideration of the details sent to him by the hon. Member for Bilston, he will set up an inquiry into the activities of the company concerned; and if he will make a statement.

31. Mr. Jackson

asked the President of the Board of Trade if he will institute an inquiry into the sales promotion practices of the organisation with a branch in Leeds, details of which have been sent to him by the hon. Member for Brighouse and Spenborough.

39. Mr. Varley

asked the President of the Board of Trade if he will institute an inquiry into the sales promotion practices of the organisation with a branch in Sheffield, details of which have been sent to him by the hon. Member for Chesterfield.

53. Mr. Cooper

asked the President of the Board of Trade if he will inquire into the activities of the organisation with a branch in Ilford, details of which have been sent to him by the hon. Member for Ilford, South.

55. Mr. Rhodes

asked the President of the Board of Trade if he will institute an inquiry into the sales promotion activities of the organisation with a branch in Newcastle-upon-Tyne, details of which have been sent to him by the hon. Member for Newcastle-upon-Tyne.

61. Mr. Alfred Morris

asked the President of the Board of Trade if he will set up an inquiry into the sales promotion practices of the organisation with a branch in Manchester, details of which have been sent to him by the hon. Member for Manchester, Wythenshawe.

63. Mr. Weatherill

asked the President of the Board of Trade what action he will take to ensure that the public are protected from the type of sales technique practised by an organisation with a branch in Croydon, details of which have been sent to him by the hon. Member for Croydon, North-East.

66. Mr. Hopkins

asked the President of the Board of Trade if he will institute an inquiry into the sales promotion practices of the organisation with a branch in Bristol, details of which have been sent to him by the hon. Member for Bristol, North-East.

67. Mr. Alison

asked the President of the Board of Trade if he will institute an inquiry into the sales promotion practices of the organisation with a head office in London and branches in many parts of the country, including the West Riding of Yorkshire, details of which have been sent to him by the hon. Member for Barkston Ash.

68. Mr. Ogden

asked the President of the Board of Trade if he will institute an inquiry into the sales promotion practices of an organisation with a branch in Liverpool, details of which have been sent to him by the hon. Member for West Derby, Liverpool.

Mr. Darling

With permission, Mr. Speaker, I will answer Question No. 16 and Questions Nos. 17, 21, 22, 24, 30, 31, 39, 53, 55, 61, 63, 66, 67 and 68 together.

Mr. Lipton

On a point of order, Mr. Speaker. It may be an oversight, but I note that Question No. 59 was not included in that list, although it mentions the same company to which the other Questions refer.

Mr. Darling

Further to that point of order, Mr. Speaker. It was not an over sight. Question No. 59, in the name of my hon. Friend the Member for Brixton (Mr. Lipton), is in slightly different terms from the others and if we arrive at it today he will get a separate Answer all to himself.

Mr. Francis Noel-Baker

On a point or order, Mr. Speaker. Is my Question No. 26 in the same category as Question No. 59?

Mr. Darling

Yes.

My right hon. Friend has received a great deal of information relating to this company, including a large number of complaints from all over the country about the sales methods which it employs.

There is very little which I, or anyone, can do to stop people signing contracts without reading them, and my right hon. Friend has at present no evidence before him to justify ordering an investigation under the Companies Act.

However, I deplore the fact that any company should have so conducted its business as to attract this volume of complaint, and my right hon. Friend is considering whether further legislation is necessary and practicable.

Mr. Dodds

I thank my hon. Friend for that reply. Is not he aware that Universal Health Studios was introduced into this country by two Americans, husband and wife, and is as crooked and callous as human beings can devise? Is not he also aware of the flood of complaints which come from many branches, from Bournemouth to Glasgow, and show an amazing trail of misery caused to many people who have experienced what is the modern version of the press gang to sign contracts they have never been able to read? Will he bear that in mind?

With regard to my second Question, will my hon. Friend also bear in mind that this diabolical technique is contained in the standard sales procedure sent to every branch? Is he further aware that the number of what this company claims to be salons for the "figure beautiful" is to be increased by another 85 in various towns and that they should really be called "salons of shame"? Will the Board of Trade act quickly in this matter?

Mr. Darling

I am well aware of the practices of this company. There is a branch of it in my constituency and I have had constituency complaints as well. The general question of the sales techniques of this company is one of the factors in the situation which my right hon. Friend is looking at to see whether legislation is required.

Mr. Hamling

Will my hon. Friend tell us how many complaints have been received? Will he consider consulting the Ministry of Health on the health aspects of these malpractices?

Mr. Darling

It is very difficult to assess the total number of complaints because they have gone to so many different organisations. Citizens' advice bureaux throughout the country have had a very large number—running, I believe, into hundreds. Some complaints have been sent to the Consumer Council and some direct to the Board of Trade, while others have come to us through representations by hon. Members. I cannot, therefore, give a total figure, but it is very large. We will certainly consider my hon. Friend's suggestion that we should consult the Ministry of Health about the health aspects.

Mr. Iremonger

With reference to the Universal Health Studio in Ilford, will the hon. Gentleman have an investigation put in train by the police into the extremely unscrupulous methods used on prospective clients of this organisation?

Mr. Darling

If the hon. Gentleman has any evidence which suggests that kind of malpractice, I think that it is up to the customers concerned or to him to draw this information to the attention of the police.

Mr. Rhodes

Is my hon. Friend aware that a branch of this organisation has been established in the City of Newcastle? Is he aware that the people of Newcastle wish to be protected, as far as can be effectively done by his Department, from the deplorable high pressure sales techniques of this organisation? Is he further aware that the instruction given by the head office of the organisation to its local managers says that they must sit in the office and continue to wear people down and hammer at them and hammer at them until they finally give in and join the club. Is this not a highly deplorable practice? Will he consider, as a matter of urgency, doing something to stop it?

Mr. Darling

This is one of the aspects which we have a great deal of information about and are inquiring into.

Mr. Robert Edwards

If my hon. Friend is unable or unwilling to conduct an inquiry into these malpractices, I wonder if he will have another look at the Fair Trade Practices Bill which he helped me to draft and which was calculated to halt the rising tide of misleading advertising? Would not a Bill of this nature deal precisely with the problem we are discussing?

Mr. Darling

Yes. I said that we were looking into the question of legislation.

Mr. Shepherd

Will not the statutory delay under the new Hire Purchase Act cover contracts applied by this organisation? If it does not, is there any possibility of its doing so?

Mr. Darling

That is a possibility we are looking at but it is difficult to apply where cash goes over the counter.

Mr. Hopkins

Is the hon. Gentleman aware that his reply is somewhat disappointing? This is a very serious matter. Legislation would inevitably take some time. Is there nothing he can do in the intervening period to put a stop to this ridiculous practice?

Mr. Darling

I agree with the hon. Gentleman. The trouble is that there is no legislation at the moment which gives us power to deal with this case.

Mr. Ogden

Will my hon. Friend have another look at the complaints I have passed to him about this organisation? Is he aware that, where matters have been pressed to a court case and where the defendant has stood out as long as he could, he has at least gained the support of the court and something has been done? Will my hon. Friend consult the Attorney-General on this point?

Mr. Darling

Yes. We are taking legal advice on all these points.

Mr. Heath

Is the hon. Gentleman aware that this really is not good enough? There has been a storm of protest from hon. Members to the Board of Trade. That has been evident today. Indeed, I myself have passed on complaints in the last few weeks. For the hon. Gentleman now to say that the Board of Trade is still considering this is not satisfactory. Could he at least achieve the maximum amount of publicity for the way in which these people behave? Will he refer it to the Consumer Council in order to get the Council publicly to condemn the firm and make these practices as widely known as possible?

Mr. Darling

If we had had the legislation which should have been passed long ago dealing with the Merchandise Marks Acts we should have been in a better position. We are handicapped as a result of the inactivity of the last Administration.

I welcome the publicity—I hope everyone will—which this exchange of Question and Answer in the House will give to this matter. The Consumer Council is considering it and the right hon. Gentleman is merely anticipating action that is to be taken on the question of publicity. I certainly hope that this Question and Answer period will not end the opportunities for publicity in this House.

26. Mr. Francis Noel-Baker

asked the President of the Board of Trade what steps he will take to control the misleading advertisements of a company, details of which have been sent to him by hon. Members and by the Advertising Inquiry Council.

Mr. Darling

My right hon. Friend at present has no power to control advertisements of services. I understand that certain of this company's advertising material has been considered by the Advertising Standards Authority and related bodies in the advertising industry, and modifications have been agreed between them. If my hon. Friend will refer any specific complaint to the appropriate bodies in the advertising industry, I am sure that it will consider it.

Mr. Noel-Baker

My hon. Friend will be aware that many of us do not consider that bodies set up by the advertising agents themselves are the appropriate bodies. Ought there not to be some independent referee? Have not grossly misleading advertisements about these health clubs appeared in reputable newspapers and periodicals for a very long time, and were not they stopped only when my hon. Friend threatened to raise the matter in the House? Are not the present arrangements inadequate? Should not my hon. Friend talk to the Press Council and the proprietors of the newspapers and periodicals concerned to try to improve on the present practice?

Mr. Darling

The problem is that we shall have no control over advertisements of services until the new merchandise marks legislation appears on the Statute Book. I think that my hon. Friend knows that the advertising industry has accepted the challenge to make voluntary control of advertising standards really effective.

Mr. Noel-Baker

indicated dissent.

Mr. Darling

I think that we should give the industry the opportunity to decide where action can be taken in this respect. I agree with my hon. Friend and I shall support him in any representations which he makes to the advertising industry.

Mr. Heath

Is the hon. Gentleman aware that the previous Government implemented much of the legislation recommended by the Molony Committee, culminating in the Hire Purchase Act of the last Session? If he concludes that he can take action only through a merchandise marks Bill, will he give an undertaking to introduce such a Bill in the immediate future?

Mr. Darling

We shall introduce the Bill as soon as it is ready to be introduced.

Mr. Noel-Baker

On a point of order. With regret, in view of the unsatisfactory nature of the reply, I give notice that I will raise this matter on the Adjournment.