§ Dr. Peter Brand (Isle of Wight)I am grateful for the opportunity of raising the issue of pedlars. I have been supported on the issue in an early-day motion that has been signed by hon. Members on both sides of the House. We have also tabled questions on the issue to the Under-Secretary of State for the Home Department, the hon. Member for Knowsley, North and Sefton, East (Mr. Howarth). I am grateful that he will respond to this debate.
There are significant problems associated with people who trade on the streets, whether they are pedlars or street traders. I should like to concentrate particularly on the issue of pedlars. I believe that they create unfair competition, are poorly controlled, cause great problems for local police forces and are certainly a major headache for environmental health, trading standards and local government licensing officers.
I am sure that pedlars once served an extremely useful function in spreading goods round rural communities, such as my own. However, they used to work on foot within a local district, and the fact that they were licensed by a local police authority was entirely appropriate if they restricted their activity to within that authority. Unfortunately, now any pedlar can get a licence from his or her own local police force and operate anywhere within England and Wales. Although I am sure that the Pedlars Act 1871 was entirely relevant to its time, I am not quite sure whether it is entirely appropriate now, especially as we move towards the millennium.
I have received considerable representations on the issue. I am particularly grateful to my colleague, Alan Hersey, a local councillor on the Isle of Wight, who first brought it to my attention. Concern about the matter has been very strongly expressed by carnival committees, bonfire societies and other organisers of voluntary events.
§ Mr. David Heath (Somerton and Frome)My hon. Friend mentioned carnival committees. He may be aware that we have a thriving carnival tradition in Somerset. Many of the carnival committees and other clubs in my constituency are concerned that the effect of the 1871 Act has been to divert funds from collections at carnivals and from charitable purposes to private hands. Those organisations look forward to a revision of the law that will deal with the situation.
§ Dr. BrandI am grateful for that intervention, and shall touch on that issue as I develop my speech. My hon. Friend also provided a demonstration of the fact that the matter is one not purely for the Isle of Wight—although we probably have more carnival committees per head of population than anywhere else in the country.
Pedlars are a particular problem for areas that are dependent on seasonal trade. Established traders, who have to be in such areas the year round, are undercut and damaged severely by—dare one say it—fly-by-night pedlars dropping in, creaming off the profits and then disappearing again.
It might be helpful if I reminded the House of a few facts. Pedlars are supposed to trade only on foot, although they are allowed to push barrows. They are not supposed to be in the same place for more than an hour, but are 317 supposed to move a bit each time that they make a sale. One can readily realise the impossibility of policing such regulations. I know that many local authority officers have spent many hours video-taping suspect traders in the hope of securing a prosecution, which is extremely hard to bring.
Pedlars are known only to their own local police authority. There is no obligation on their part to inform police in the place where they are operating. Although they have to show a pedlar's licence when apprehended, they are allowed to carry on the trade for which they have been licensed if they are on the public roads—which presents the problem for charity organisers who hold events on public land. It is not unusual for pedlars to move from one such event to the next, creaming off the take that really should be going to the societies organising the event.
Not only is it important for carnival committees or bonfire societies themselves to receive an income from the events that they organise—if they do not, they cannot continue operating, and it has been very difficult for some organisations to continue operating—but, when they are in surplus, they are big contributors to local charities. We should encourage such practices as a part of the great diversity and richness of the British tradition.
Pedlars pay only £12.50 annually for a licence. Street traders usually have to pay up to 100 times that amount to be licensed by a local authority. Again, it shows that there is an unfair competition.
Street traders, whose goods can be checked by local authorities, are often undercut by pedlars working in the same area. In my constituency, many street traders provide valuable employment by selling well-made, locally produced goods. Pedlars coming in undercut those street traders, very often with shoddy goods that are very difficult to return as the pedlars move off immediately once one discovers that a new watch has fallen to bits or that those new bright lights no longer shine.
Street traders are strictly controlled. Before they are given a licence, nuisance to local tenants and competition with other shops and cafes are carefully considered, and noise and smell nuisance are taken into account by local authorities, which find it extremely difficult to exercise the same types of control over the peddling fraternity.
There is some evidence that, because their goods are not controlled, pedlars can do harm to the general public. There have been cases of goods, especially toys, being sold that would not have been approved by local trading standards officers. However, in such cases—especially if there is no organisation sending pedlars out—it is extremely difficult to attribute blame if something happens. The idea of caveat emptor is a wonderful one. However, when in the middle of a charity event a child wants a specific teddy, it is very difficult to say no. Moreover, nowadays people expect goods on sale to be of a marketable quality. I am afraid that, because of the loophole in current legislation, we are failing in meeting such expectations.
As I said, it is difficult for police to take action if pedlars are not breaking a criminal law. It is also extraordinarily difficult and time consuming to have to establish that pedlars have not moved the appropriate number of times. Such exercises are extremely expensive for local authorities.
318 I should like to return very briefly to the harm that peddling does to charitable organisations. It is important that we continue to support and enable community organisations—which very much are community-based organisations—to continue with activities such as providing carnival floats and organising local bonfires, fetes and other village green activities. It is not unreasonable to allow organisers of such events to recoup some of their expense, by licensing agreements with the local authority, to pay for the associated costs of the carnival, fireworks or bonfire. Many societies are on the brink of failure because their finances are being severely damaged by people coming from far away whose only purpose is to cream off some money and then disappear. These people make no contribution to the local community, unlike local shopkeepers, local street traders and, of course, the organisers of charitable events.
It is not in order for me to ask for a change to the legislation. I know that the Home Office has had the issue of pedlars and their licensing under review since 1994, so I hope that it is in order for me to ask the Minister when that review will be published and what the Government's plans are to deal with an extraordinarily anomalous situation.
§ The Parliamentary Under-Secretary of State for the Home Department (Mr. George Howarth)I am grateful to the hon. Member for Isle of Wight (Dr. Brand) for initiating this debate. This is not a subject that often gets an airing in the House, but I know from my correspondence with him, to which he referred, that it is one which in some areas gives rise to considerable concern.
Pedlars have long been a feature of life in this country, but many people are unclear about precisely what the term means today. To some it is an anachronism with little relevance to modern life. A quick glance at the Pedlars Act 1871—and, indeed, the subsequent legislation of 1881—supports the view that the hon. Gentleman expressed. For example, references to "caster of metals", "mender of chairs" and a person who "travels and trades" without any horse or other beast "bearing or drawing burden" certainly prompt questions about the continued relevance of the legislation.
However, there is no doubt that peddling continues to be a distinctive method of trading, even though the nature of the business may have changed. For example, certain door-to-door salesmen are classified as pedlars, although that by no means covers the wide range of people who conduct their business by calling at people's homes.
It is the type of pedlar who plies his trade in busy streets in the centres of towns and cities who is of particular concern to the hon. Gentleman and to the hon. Member for Somerton and Frome (Mr. Heath). As the hon. Member for Isle of Wight says, in law pedlars are not street traders and are subject to different regulations. Councils can designate streets for street trading, and street traders must obtain from the local authority a licence, or at least a consent, to trade in those streets, usually from a specific pitch. They must also pay the requisite fees and charges and observe various conditions.
On the other hand, a pedlar obtains a certificate from the police for only a modest fee. This allows the pedlar to conduct his or her trade anywhere in the 319 United Kingdom. The hon. Gentleman referred to some of the difficulties to which that might give rise in that the certificate is issued in one area but can apply in other areas. I understand the hon. Gentleman's point very well.
The essential point is that pedlars are expected to move from place to place. Court judgments in recent years have tended to confirm this. The effect of those judgments is that a pedlar must keep on the move, apart from when conducting a sale. This gives a useful pointer to the type of trader we are talking about. We have all seen people wandering the streets with, typically, foil balloons, T-shirts or similar items for sale. Those traders are clearly pedlars.
The hon. Gentleman described the problems which he says are being caused by pedlars in his area. If he did not go so far as to say that the law favours pedlars, he suggested that it needed some adjustment and should be changed accordingly. I shall return to that issue shortly.
Perhaps I should comment on the rationale behind the present arrangements. Street trading is a more regulated and costly business than peddling because it is a more substantial operation. A street trader can establish a fixed pitch, which will inevitably involve the local authority in cleaning and other costs that we can fairly readily imagine.
§ Dr. BrandIn practice, it is often extremely difficult to spot the difference between a pedlar and a trader, other than the fact that the pedlar has to move on. Traders and pedlars leave the same amount of litter, but street traders are rather more responsible because they know that they risk losing their pitch.
§ Mr. HowarthThat is precisely the point that I was making. A street trader may leave a mess but the process is properly regulated. The difference is that he has the opportunity to sell a wide range of goods and to build up a regular turnover, customer recognition and, in some cases, customer loyalty. I say that, not in defence of pedlars, but merely to draw attention to the fact that there is a crucial distinction.
A pedlar who is genuinely operating as a pedlar has no fixed spot. He must keep on the move, which means that there are fewer associated costs. It also means that he is limited to selling only those goods he can carry. Pedlars are therefore offering a rather different service from that offered by street traders. That is reflected in the "lighter touch" regulation that they enjoy.
I understand how frustrating it must be for established traders to face competition from what are in effect opportunistic operators. It is clearly wrong that licensed street traders, who have responsibilities and expenses, lose business to fly-by-night, unlicensed competitors. It is not entirely clear how far the problems we have heard about today are caused, or exacerbated, by unlicensed street traders as opposed to genuine pedlars.
The fact is that anyone who simply sets up a pitch, or conducts business from a stationary position, in a designated street, is likely to be engaging in unlicensed trading. This attracts a maximum penalty of a £1,000 fine. This would be the case even if the person concerned produced a pedlar's certificate. The courts have made this clear. The question is whether a pedlar remained on one spot for any length of time, so effectively inviting customers to come to him. If so, he would be street trading without the necessary authority.
320 Unauthorised traders can pose significant problems, particularly in town centres at busy times. I accept that, as the hon. Gentleman said, they can cause a real headache for local authorities in terms of enforcing the law, which can become a difficult and burdensome process. In some cases, there could be problems in establishing the point at which a pedlar—with or without a certificate—is actually engaged in unlicensed street trading. The fact remains, however, that in these circumstances remedies are available. Anyone who acts as a pedlar without a valid certificate is also liable to prosecution. In addition, he may be causing an obstruction under the Highways Act 1980.
There have been suggestions that the sentences available to the courts are inadequate. The hon. Gentleman referred to that implicitly, if not explicitly.
§ Dr. BrandI am grateful to the Minister for trying to read my mind, but that is not the case. The problem is in securing a conviction. It is extremely difficult to get the evidence on which to convict. I hear what the Minister says, but as his speech progresses I hope that he will comment on whether it is still appropriate for someone who is supposed to trade on foot to travel in a car, or by coach or lorry, from the area in which he has been given his licence and then to walk but use the vehicle as a base.
§ Mr. HowarthThat is an interesting point and I shall reflect on it. I do not want to give a precipitate answer that would not necessarily be helpful to the hon. Gentleman, so I shall write to him and attempt to provide some sensible guidance as to how an authority should operate in those circumstances.
§ Mr. David HeathI am most grateful to the Minister. Will he also touch on the competition with charitable collections, particularly in the context of carnivals, which by definition move around? The current position is perverse, as the Charities Act 1992 makes it more difficult to obtain a licence to collect money for charitable purposes than to obtain a pedlar's licence and extract money from the same crowd under what I consider to be a false pretext.
§ Mr. HowarthI am grateful to the hon. Gentleman, who raised that point in an earlier intervention. I shall comment on it later in my speech.
Our general policy on sentencing levels is to ensure that they are proportionate to the degree of mischief caused. Before we make any decision to increase the penalties available, we need to look carefully at a number of factors, including the sentencing practice of magistrates within the existing scale. The information available suggests that the sentences imposed for street trading and peddling offences generally fall well short of the maximum. There must therefore be real doubts as to whether increasing the level of fine, for example, would make any appreciable difference. As the hon. Member for Isle of Wight said, there may be other ways of facilitating prosecution and I promise to look into that.
It is sometimes said that pedlar's certificates are used as a cover for unlicensed street trading. I know that some pedlars attempt to exploit the certificate in that way, but the number of pedlar's certificates issued—around 2,000 a year—appears to be declining. On the other hand, 321 reports of unlicensed street trading are on the increase. It is a persistent problem in many areas. It is arguable whether the presence of pedlars makes matters a great deal worse. Many of those involved in unlicensed street trading are not pedlars and, what is more, make no claim to be so. I know from my own experience on Merseyside where there is a particular problem. I have had direct experience of it in the centre of Liverpool so I do not want to underplay it.
I understand why street traders and other businesses may feel that even genuine pedlars present unfair competition. After all, they are exempt from street trading controls and, as the hon. Gentleman rightly pointed out, their costs are lower. However, a bona fide pedlar has to be able to carry his wares. Given the more limited range of goods that he can sell, I am not sure how far he can be said to damage the business of street traders. It could be argued that the competition offered by pedlars is no more unfair than that between street traders and small shops—it is a matter of different considerations—or between small shops and out-of-town stores. Pedlars often quickly move on. Many people will therefore choose to buy goods from more established traders whom they will inevitably regard as more reliable.
§ Dr. BrandI am sorry to ask your indulgence again, but there is a significant difference between the various groups that you have mentioned and pedlars.
§ Mr. Deputy Speaker (Sir Alan Haselhurst)Order. I remind the hon. Gentleman that he should be using the third person.
§ Dr. BrandDoes the Minister agree that there is a substantial difference in that the list of activities that he mentioned are all either licensed by or governed by planning controls and are subject to the local authority and the anomaly is that there is absolutely no local control over pedlars?
§ Mr. HowarthOf course, but planning controls invariably relate either to pitches in the case of street traders or fixed location properties and it would be difficult to apply them to somebody who, by definition, must keep moving. Of course I accept that additional controls apply to other traders.
As the hon. Gentleman has made clear, in the Isle of Wight there are particular worries about the practice and the standard of goods on offer. Unscrupulous operators are clearly a menace and the licensing of street traders and certification of pedlars is designed to reduce that risk. Consumer protection legislation applies just as much to goods bought from street traders or pedlars as to those purchased from other outlets. I recognise, of course, that 322 such traders—particularly pedlars—may be rather more difficult to track down. However, a customer can, and should, ask to see a pedlar's certificate before buying from someone on that basis. Most people are fairly cautious about what they are prepared to hand over money for in the street, although particularly in places such as the Isle of Wight, and perhaps Somerset, many people are on holiday so their defences may be somewhat lowered.
The hon. Members for Isle of Wight and for Somerton and Frome mentioned charitable collections. I share their concern about the abuse of the pedlar's certificate for fraudulent charity collections. Where individuals collect money or sell goods on behalf of a named charity, the promoters are required to obtain a licence from the local authority. Part III of the Charities Act 1992, which has yet to be implemented, will simplify and strengthen the existing controls. However, the issues involved are indeed complex and the Government are considering when and how the measure might be implemented.
I accept that a pedlar's certificate may make life easier for those determined to mislead the public. Unfortunately, carnivals—to which both hon. Gentlemen referred—or similar large-scale events, will always attract such characters. I shall give further thought to the real and serious points that both hon. Gentlemen have raised and if there is anything that we can usefully do, I shall notify the House in a suitable manner.
As the hon. Member for Isle of Wight said, in 1994 the previous Government began reviews of pedlars and street trading legislation. I should make it clear that they did so in the context of their deregulation exercise. The aim of the reviews was to see whether the burdens imposed by the legislation could be reduced, but some complex issues were raised and the responses to both reviews were very mixed. In the case of the pedlars legislation they were fairly evenly divided, but a small majority favoured strengthening the controls.
The hon. Gentleman has argued for pedlars to be brought within street trading controls. That would require primary legislation and he realises the difficulty involved in that. We need to recognise that such an option is available, but be cautious about using it. Nevertheless, I shall certainly consider the points he has made about the problems posed by pedlars. Similar arguments were raised in some of the responses to the 1994 consultation paper and I accept that they are the subject of real concern.
At this stage I have reached no firm conclusions about the merits of further action in relation to either pedlars or street traders. Although I am not yet persuaded that increasing controls on pedlars would greatly alleviate the difficulties experienced by street traders and local authorities, I can assure the hon. Gentleman that I will look carefully at the issues in considering our future policy. In doing that, I shall reflect carefully on the points that he and the hon. Member for Somerton and Frome have raised during the debate.