§ 2.49 p.m.
§ BARONESS BURTON OF COVENTRY
rose to call attention to future administrative developments on consumer problems; and to move for Papers. The noble Baroness said: My Lords, in rising to move the Motion which stands in my name on the Order Paper, perhaps I could start with the legal problem of small claims. I hope to cover four main sections in my remarks to-day, namely, the legal problem of small claims; consumer inquiries or complaints; how the Trade Descriptions Act is working; questions being asked in the consumer world.
In our debate on June 23, 1966, I drew attention to the problems and cost of bringing these cases to court, and a year later, on November 14, 1967, I stated what we all realised to be an obvious fact: that we are all too unaware of our legal rights, but, in addition to that, the difficulty, the cost and the uncertainty of enforcing them by legal action deters us from making the attempt. If an aggrieved customer has been persistent, if he has tried what seem to him to be all possible channels—the retailer, the manufacturer, the Citizens Advice Bureaux, the local Weights and Measures inspector, his Member of Parliament and perhaps the Press—if he has tried all these and has got nowhere, what remains? The right to take the case to court. Two years ago I believed that court procedure had not been able to solve the problems of the length and the cost of actions, which are both far too great to deal with the problem of small injustices.
As the House will know, Focus is the magazine published by the Consumer Council and their issue of last July contained an interim report entitled, Is the Legal System any Use to Consumers? It is because of this that I have returned to my theme of three years ago. Do consumers consult solicitors? Do they use the courts? The Consumer Council say that they would be more emphatic and advise people to go to a solicitor 1257 were it not for the fact that their experience suggests that the present legal system is not suitable for pressing consumer claims.
They did a special survey into consumer claims; in other words, claims or counter-claims by ordinary people for misrepresentation or for breach of contract on the grounds that goods or services purchased were not satisfactory. The project covered small claims; that is, claims within the £500 limit of county court jurisdiction. But it was chiefly concerned with claims in the region of £20 to £100 as being the range involving sums regarded as substantial by consumers but as relatively small by the legal system.
The Consumer Council feels that consumer claims form a large enough class of potential legal problems to be considered on their own. Research was carried out into county court records. A survey of solicitors and one of consumers was also made. Obviously court records are regarded as confidential, but permission to examine these was obtained from the Lord Chancellor's office and the registrars concerned, provided that no disclosure was made of parties involved. From this research it appeared doubtful whether county courts were a suitable forum for consumer claims, for two main reasons: first, an individual would find it difficult to conduct a case himself in the county court, while representation at any rate for small claims, is prohibitively expensive; and secondly, the unsuitability and expense of court procedure for technical matters.
Solicitors, asked whether they thought an individual without legal representation could bring an action, felt that few people could handle a complex claim, though many could manage a simple debt claim. Most consumer cases have a technical aspect, and solicitors felt that not only technical questions but complex legal ones were often raised in small claims. Many solicitors were concerned at the prohibitive cost of getting justice over small matters, and this point was made by my noble friend Lord Silkin in the debate on the Address at column 69 on October 29 last.
The Citizens' Advice Bureaux have also been concerned for some years about the relatively minor disputes in which the amount of money at stake is small and 1258 where, because of the fear that the cost of legal proceedings might exceed the amount involved, the matter is now often allowed to go by default. They would therefore welcome the development of informal procedures as alternatives to the courts in such cases and have offered to support and co-operate with the Consumer Council in any further research which may be undertaken. I believe that my noble friend Lord Donaldson may be referring to this matter when he comes to speak. But we should welcome some comment from the noble and learned Lord the Lord Chancellor, and I should like to say to him how much vie all appreciate his intervening today; we know how heavily burdened he is, and we do say "Thank you". We all know his serious concern on matters like these, and I appreciate that a start has been made already in that there is provision in the Administration of Justice Act 1969 by which the financial limit of the cases heard before registrars instead of judges is raised from £30 to £75. This must speed up the procedure. But on the question of expense, would the noble and learned Lord the Lord Chancellor feel able to comment on the small claims courts held in many American towns and cities, as described in the December issue of Focus? Would these be a possibility here?
I come now to consumer inquiries or complaints. As we all know, these are the job of the Citizens' Advice Bureaux and not of the Consumer Council. For some time the Citizens' Advice Bureaux have made a continuous survey of consumer inquiries. To begin with, a pilot scheme was initiated and this was replaced by a system worked out with Board of Trade statisticians. This system was launched in February of this year and was based on a statistically selected sample of about sixty Bureaux distributed all over the country. Those sixty Bureaux were to report on every consumer inquiry. except in the case of Birmingham which was to report on one in ten, in order to lessen the burden of work on the Bureau workers. The forms sent in by the sixty Bureaux to the C.A.B. headquarters are analysed there and weekly reports are sent to the Board of Trade and the Consumer Council, and I myself have a copy. Probably it would help if I stated what the headings are in these weekly reports. 1259 They are five in number: subject; number of inquiries; date of purchase or contract; approximate cost of article or service; and details.
This has not been the success, or (shall I say?) has not proved its usefulness as much as I anyway had hoped. Why? It is my belief that the original intention was that the Consumer Council should follow through these weekly reports, and this they have not done. Why not? I think the Consumer Council would take the view that insufficient detail has been supplied to them. This is a complicated and involved story which I would prefer to leave for the time being. But perhaps I might digress for a moment and say how I had envisaged this information being used.
I wanted to see the Consumer Council dealing with the national picture, obtaining information from the Citizens' Advice Bureaux on which they could build the the national scene, enabling them to stress where various evils were. For example, suppose returns from the Citizens' Advice Bureaux show many complaints either about particular merchandise, particular methods of selling or advertising merchandise, or too many complaints coming from a particular area and reflecting apparently on traders there, I could see the Consumer Council moving in to call attention to that. I have always believed that the Council had a special function at national overall level and also that they had the means, the machinery and the people to do just that. I have still to be convinced that they should deal with actual complaints or should have regional or local offices; but I do see the development of their excellent broadsheets, pamphlets, booklets, which do so much to help us all and which influence necessary public opinion.
Why has this not worked out? Primarily, if one is honest, it has not worked out because the relationship of the Consumer Council to the Citizens' Advice Bureaux has not been a good one. It is not for me to apportion responsibility for that; nor would it help if I did so. But if this basic fact is not realised it will not be possible to put the matter right, and I believe that if the matter cannot be put right a new system must be found. Really the Citizens' Advice Bureaux and 1260 the Consumer Council never talked the same language, especially over paragraph 858 of the Molony Report, which deals with co-operation between them. There is, of course, the further problem that the Citizens' Advice Bureaux have never found it easy to co-operate with a pressure group, and the Consumer Council see themselves very much in this role. I should like to see the Consumer Council helping the Citizens' Advice Bureaux to do their job more successfully. It would mean that the Council would have to master the principles and techniques upon which the C.A.B. movement is based. Long experience, going back over 30 years, has shown which methods produce the best results in C.A.B. work, and help must be acceptable to them.
I personally think that the onus here is on the Consumer Council. If the Molony recommendations are to be implemented successfully, adequate co-operation and co-ordination are essential. This we have not got. How far have we got to-day with what Molony actually recommended? As the House knows, their priorities are given in paragraph 913 of the Report. In so far as hire-purchase and merchandise marks are concerned the major legislation has been enacted, but the law relating to Sale of Goods has still not been revised. Surely this should now have priority?
As Members know, the Sale of Goods Act 1893 gives the purchaser of goods the right to undisturbed possession and to insist that the goods should match the description under which they are sold and comply with reasonable standards of quality and fitness for their purpose, but it allows the seller to contract out of these conditions. The recent Report of the English and Scottish Law Commissions states that sellers of goods should no longer be allowed to contract out of the statutory duties to provide the buyer with what he expects to get. Many of us have felt strongly on the two questions of contracting out and guarantees, and have expressed these feelings on several occasions.
I realise, of course, that so far as the Law Commission's Report on Exemption Clauses is concerned, this matter would ordinarily be for the Board of Trade; but as we are fortunate enough to have the Lord Chancellor intervening, 1261 we hope perhaps to have his views on this aspect. And on two other points, one general and one specific, I wonder whether he would feel able to comment? On the general point, in the United States President Nixon is proposing to expand jurisdiction of the Federal Trade Commission and to establish a new consumer protection division in the Justice Department. Would it be useful for us to consider that general principle here? And on the specific point, I understand that for some little time our own Government have been examining the legislation in force in New York State under which, if someone receives unsolicited goods, they become his property as an unconditional gift. I was intending to ask whether we could bring in such legislation here, because it would be welcomed by many people. But as the House may know, events have caught up with me and we now have a Bill dealing with unsolicited goods to be introduced by Mr. Davidson in another place. It may be that this fact inhibits comment by the noble and learned Lord on the Woolsack. Reverting to the Molony recommendations, I would point out that if the Sale of Goods Act were dealt with we should then be left with the problem of the control of unregistered seals of approval. I think this afternoon we could ask the Government to give us an indication as to when those two particular items will be dealt with.
I come now to my third section, how the Trade Descriptions Act is working. In the October issue of Which?, the organ of the Consumers' Association, there is a cogent précis of the Act, and I think three points are worth quoting. They are these:1. The Act is concerned only with descriptions that are false or misleading to a material degree;2. The Act is not a general prohibition against shoddy goods—it is concerned with misleading descriptions;3. The Act lays it down that any of these misleading claims is a criminal offence: a guilty trader may get heavily fined but his victim does not necessarily get any recompense.That is what the Act does. How is it working? As we all know, local Weights and Measures authorities have been given the duty of enforcement of the Act. I think it should be said straight away that 1262 because of public misunderstanding about this Act many Weights and Measures authorities have received a number of quite unrelated complaints from shoppers. Recently, the Consumer Council sent out a questionnaire to 242 chief inspectors of Weights and Measures in order to discover how the Act was working. Replies were received from 174, and my following three points are taken from the report in the November issue of Focus. The answers showed, first of all, that during the first six months of the life of the Act at least 17,500 complaints were registered from all sources. Of these, some 11,200 were possible offences reported by the public, some 4,100 were spotted by members of Weights and Measures departments, and 628 were registered by traders or manufacturers, sometimes against each other, sometimes against their own suppliers. If any noble Lord has been adding up those figures he will of course realise that they do not exactly balance. Secondly, labels giving misleading information were the biggest single source of trouble. Thirdly, the three sectors which the Act deals with —goods, prices, services—are not covered equally comprehensively. Enforcement of the Act's provisions in relation to prices is more difficult than it is over descriptions of goods. This has always been obvious.
The House knows what I think of Section 11, and I do not propose to weary your Lordships with tedious repetition. But strong criticism comes from some sections of the grocery trade—not against the Act but against Section 11, which is felt to be virtually unworkable for them. Some groups declare that they are now in the state where the same article might be on sale in their shops at a variety of prices. Are they right? Is their system of management at fault? Or is the Act in need of amendment?
The Chief Inspector of Weights and Measures for a wide area comprising Westminster, Kensington, Chelsea and Hammersmith, is quoted in the Sunday Telegraph of October 12 last as saying:The section dealing with prices is particularly open to evasion and the return of the recommended price, legally meaningless, has been widespread. We must assume that the law will, at some future date, be examined and in part re-drawn.It is not that Section 11 is not enforceable—of course it is enforceable—but it 1263 is badly drafted, limited and full of loopholes which are widely used.
It would be helpful to know from the Minister what the Government now think of this particular aspect, and of one further point made to me by more than one person. The interpretation of many differences is left to magistrates, and local authorities naturally apply the Act differently. Could the Board of Trade help with some co-ordination and guidance to local inspectors? Presumably their local autonomy is guided by the Board of Trade, and they must work directly in line with their legislation. I think we should bear in mind that they are criminal enforcement officers and their help to consumers is incidental. Some inspectors of Weights and Measures have set up sections to deal with all manner of complaints from local shoppers: the burden has been heavy and additional staff will have to be taken on. But we must look carefully at this and see that there is no wasteful duplication of effort in any area. These, I think, are some of the drawbacks to the success of the Act, but if we exclude Section 11 there is no doubt that the legislation is working well. It has proved a considerable deterrent to that minority in need of such action.
Now I come to the fourth section, questions being asked in the consumer world. In the September issue of the Trade Information Service of the Retail Trading Standards Association, their Director, Mr. Roger Diplock, asked some himself. Several people to whom I have talked said that they could not have thought of better ones. I propose to deal with these for three reasons. The first is that nobody knows more about consumer problems than Mr. Diplock, and the R.T.S.A. has rendered great service to consumers and industry alike. The second is that over a period of almost twenty years never once has the R.T.S.A. given me wrong information. The third is that these are the questions that the consumer world is asking. I informed the noble Lord, Lord Drumalbyn, and the noble Lord, Lord Donaldson of Kingsbridge, that I should be dealing with these.
First of all, I take the Consumer Council. Mr. Diplock asked: 1264Has the Consumer Council, grant aided to the extent of £210,000 annually, made its mark on consumer affairs?Yes, my Lords, I think it has; but not enough, and not the right one. I shall return to this matter finally. Next he asked:If not, to what extent is this due to the restricted terms of reference which forbid the Council to handle consumer complaints?At one time I thought the terms of reference needed looking into, but after the work of these past three months I am not so sure. I do not think the Council should handle consumer complaints. Mr. Diplock further asks:Does the Council, indeed, fulfil an essential function which warrants the expenditure of public money?My Lords, on the publicity side and on some research I think it does, but the word here is "essential" and I do not believe the Council is fulfilling an essential function, its essential function, and I shall come back to this finally.
On the question of public money, I should like to ask something myself. In the current annual report of the Council the accounts section lists "publicity and research" payments as £64,721 Os. 4d. Could we have this item broken down to tell us how much was spent on the national advertising campaign for TELTAG? How much goes on consumer education, schools, colleges, general publicity. What was the cost of the research projects listed in Appendix D? These are all questions involving the expenditure of public money and are asked for information and not in antagonism. I did, of course, give notice of them to the people concerned.
Now we come to the Citizens' Advice Bureau. Mr. Diplock says:There was an intention that the Citizens' Advice Bureaux should widen the scope of their help and advice to local residents in order to embrace shoppers' problems. There are now 500 citizens' advice bureaux throughout the country. Has the intention of the Government in fact been realised?The scope has been widened to embrace shoppers' problems, but insufficient money has been available to create adequate development.
Two years ago, in our debate on November 11, at col. 614/15, I stressed that more money was needed for this work, which we must remember was laid on the Bureaux by the Government of 1265 the day. Indeed, I said I believed that the Council of the Citizens' Advice Bureaux was quite unable, because of the financial problem, to develop as it should and indeed to appoint the actual staff needed then to deal with this burden. I asked the Government (my Government, if the noble Baroness, Lady Phillips, does not mind my saying so) to have a look at this matter, saying that we should at least make sure that the bureaux were equipped financially to staff themselves adequately. I hope the Minister will be able to tell us what has been done about this.
Mr. Diplock further asks,… to what extent can these bureaux be manned by experts able to give sound advice to shoppers—or indeed solve the intricacies of their complaints?On "complaints", I believe that most lawyers would agree with me that trained voluntary workers in citizens' advice bureaux are as capable of giving sound advice to shoppers as they are of giving sound advice about housing legislation or employment problems, and this has never been in doubt. Concerning "intricacies", I go back seven years ago to our first debate in this House on Molony on November 14, 1962. I stressed then how essential it was that this problem of technical advice was dealt with: that to begin with this should cover four main classes of goods, the four main classes mentioned in the Molony Report as having given rise to most complaints over past years, so that any local citizens' advice bureau which had merchandise brought to it and on which it could not get good technical advice itself, or locally, could refer the matter to the centre. That was in 1962, to a Conservative Government. On March 24, 1965, at col. 637, I tried again, changing my four main classes to five and saying that until this problem of technical advice was dealt with the system would not work, irrespective of who dealt with complaints. That was to a Labour Government, with exactly the same results—nil.
The last question is:Can the Bureaux give sound advice to shoppers?As recently as last year the Citizens' Advice Bureaux informed me that they could find acceptable solutions to 90 per cent. of the consumer inquiries dealt with, but that the remaining 10 per cent. needed 1266 to be referred to a specialist service. Most people consulting Citizens' Advice Bureaux about disappointing purchases want redress and are not often concerned to punish offenders. Complaints are more often founded in disputes about facts than in matters of law; but even if the squabble could be resolved by legal action there would almost always be a need for expert opinion as to the performance of the offending article.
The last two groups of questions deal with the Weights and Measures authorities. I have already tried to cover these points, and I think other noble Lords will deal with that area. This brings me to my conclusion and to the very fair question, "What do you suggest should be done?" Administratively the most disappointing outcome of all this has been the failure to recognise the Consumer Council as the co-ordinating machinery. The consumer is not nearly so well served centrally as he is locally. There is not nearly enough co-ordination of effort or, indeed, co-operation between the various bodies supposed to be devoted to consumer interests.
I see three outstanding needs. The first one is co-ordination in a non-pressure atmosphere of the work being done on behalf of consumers; this should lead to greater co-operation. I believe that the Citizens' Advice Bureaux should continue as at present, but only if given adequate finance and independence. This must be forthcoming in the near, the very near, future. If not, then the work will not be successful because of lack of adequate implementation. Responsibility here lies primarily with the National Council of Social Service and with the Government. I hope the Minister will comment for the Government, and I understand that the whole position is now under review between the National Council of Social Service and the National Citizens' Advice Bureaux Council.
The second need I see as informal machinery for the resolution of difficult complaints. This should aim at the facts, leaving it open to the contestants to appeal to the courts on points of law. A number of pilot schemes would have to be tried to determine whether such machinery would work at all, and what form would be most successful. The third need is that it must be decided what central organisation and/or machinery is to do 1267 the co-ordinating. Should it be the Consumer Council as now? Should it be the Consumer Council with a new constitution? Should it be something else altogether?
My Lords, what type of organisation is necessary to co-ordinate voluntary organisations and trade, local authorities and consumer bodies? What type of body is necessary to follow through the continuous survey done by the Citizens' Advice Bureaux—by refurbished Citizens' Advice Bureaux? What type of body is necessary to satisfy consumers while being fair to retailers?—because we must bear in mind that many consumer complaints are unjustified; that retailers and industry alike deplore the relatively few black sheep who bring discredit upon them but who must be dealt with. That point must be decided: it has been left in abeyance far too long. I see it as a responsibility of Government. I believe that in the past the Government have not looked into this problem sufficiently deeply. I think they should do so now.
I have spent three months preparing for this debate—I hope that it has not seemed even longer to your Lordships. At the beginning I felt that the Consumer Council must have a new constitution or we must have something else altogether. These three months of consultation have brought home to me more than ever before this lack of co-operation and co-ordination that I have been talking about. My Lords, I think this situation could be put right with the existing set-up, so I should like to see one final effort made before we realise we have to embark on a new system. So I return to our old friend Molony and to paragraph 872 of the Report—and I hope the House will bear with me while I quote it:We look to the Consumer Council to inspire and co-ordinate the activities of other organisations working for the consumer. We plan to give it the supreme position in consumer affairs. Whether it will seize and retain this position will depend on the quality of its personnel and organisation and its handling of problems. Whether all other consumer bodies will acknowledge its authority remains to be seen. Since they are independently constituted this cannot be assured. But we have little doubt that even if the constitution we recommend for the Consumer Council does not wholly match their views, they will not with- 1268 hold co-operation. We do not accord it the position of a dictator or claim for it any right to interfere in the organisation or methods of working of any other body. But we would wish to see the paramountcy of the Consumer Council accepted, and its right to act as the overall leader and co-ordinating agency in consumer affairs acknowledged.My Lords, this result has not been achieved because of lack of confidence. and I should like (and this point is, I think, the only one of which I have not given notice to the noble Baroness) to see the President of the Board of Trade call together six people, with himself in the chair. The six people would comprise the Chief Officer of the Consumer Council, the National Citizens' Advice Bureaux Council, the Consumers' Association, the Federation of Consumer Groups, the Women's Advisory Committee of the British Standards Institution and the Institute of Weights and Measures Administration. I believe that in that sort of atmosphere these people could explain why they have not had this confidence, with the consequent lack of co-ordination and co-operation. I believe that these six people, together looking at this whole problem, with nobody laying down the law, could bring about a new era. Without such a meeting there will have to be a new plan; but obviously we cannot go into that to-day.
My Lords, I have many friends of long standing in the consumer world. At all times—for ten years in another place, and particularly for our original debate here seven years ago and for that of to-day—these friends have given me comments, advice and their unstinted help. I like to think also that they have given me their trust, and I hope that by being frank to-day I have not lost them. I beg to move for Papers.
§ 3.25 p.m.
§ LORD MOWBRAY AND STOURTON
My Lords, we are all deeply grateful to the noble Baroness for raising this subject, which we know is very dear to her heart. If it is not impertinent, I should like to congratulate her on covering such a wide field, and also congratulate myself in that I anticipated that she probably would cover a wide field and that, therefore, such a far-seeing approach from myself would not be needed. I have certainly not been preparing this speech for three months. I think it is well known to 1269 your Lordships that this is the first time I have ventured to enter on this subject in your Lordships' House; but I am slightly heartened in that I suspect that this is also the first time the noble Baroness, Lady Phillips, has taken on Lord Brown's mantle in this matter. But I may be wrong in that.
At any rate, to-day we are going to survey this field, which for 18 months now has been strengthened by the Trade Descriptions Act of last year, the results of which are now beginning to be seen. Last month the President of the Board of Trade described that Act as, "The consumer's charter, the housewife's friend, the motorist's delight—all rolled into one.". In fact, he thought it ought to be known as, "The people's pal". He then described it as the most effective little Act that the Labour Government had introduced. I think, with all that, he might well have called it the most effective and gallant little Act, as it obviously had to do so much manful work. struggling against the huge giants of Mammon and Corruption, with all their temptingly false sugary attractions.
However, I was happy to learn from the same right honourable gentleman, the President of the Board of Trade, that in the nine months concerned only 295 cases had to be brought before the courts, and that only 384 cases were pending. I trust, my Lords, that this means that this gallant little Act has put to rout all those false deceivers, and not that the Weights and Measures authority are unable to cope. I wonder whether the noble and learned Lord on the Woolsack, or perhaps the noble Baroness, Lady Phillips, will be able to tell us that the recruiting situation for qualified staff in the Inspectorate of Weights and Measures has improved since the Mallaby Report came out, which indicated, I think, that in London they were something like 33 per cent. under strength. Hearing to-day and yesterday of the six inspectors who have to travel the globe inspecting the canned meat which is to come into this country from foreign sources, one is rather led to suspect that the Inspectorate may still be somewhat short of qualified inspectors. I only hope that these gentlemen may be qualifying for "Her Majesty's Greyhounds", as they must do more travelling than many of Her Majesty's diplomatic messengers.
1270 My noble friend Lord Drumalbyn will discuss in more detail the involvement of Weights and Measures inspectors, in which matter he has always taken an enormous interest and about which he knows more than most Members of this House. It is still early days now for the full picture to have emerged, but we on these Benches hope that it is the Board of Trade who are supervising the decisions as to when to prosecute, or when to prod the erring manufacturer or retailer back on to the paths of righteousness. We hope it is not being left to the local Weights and Measures authorities to decide in lonely isolation their various policies, with all the differences over the country which would then arise. I think this is a reasonable thing, which has been expressed in both Houses in the past. It is too early for us to know, but perhaps Her Majesty's Government may know the trends before the facts are published, and may be able to help and advise us.
There are still various professions which, for various reasons, go on using inaccurate descriptions quite automatically because the phraseology has become commonplace jargon in their particular profession. I noticed that the housing correspondent of the Daily Telegraph was complaining this morning that many properties are described as "luxury" which by modern standards are just not the case. He quoted one or two instances which your Lordships can read for yourselves. Certain people —shall we say those who are in this country from abroad and who are hopefully seeking temporary work and temporary accommodation —do not always find it easy to check up on these descriptions in person. In the case of renting, we know that, especially if it is temporary, the landlord is apt to ask for rent in advance. If one has paid rent in advance for a luxury flat only to find that the luxury consists of one radiator which is hardly working and a lavatory in which it is necessary to climb on to the seat to operate the flush, then, if the renting is temporary and one cannot prolong one's stay and does not wish to risk the extra money involved in suing in the civil courts, one may suffer grave injustice through this false description. I am sure that there is a great weight of public opinion ready to prod the Consumer Council or the Weights and Measures Inspectorate (whichever 1271 body has this duty) into enforcing the regulations. I think that house agents are perhaps one of those professions who are living in the past in their descriptions.
I come now to another matter which is close to most consumers in the country. This is the money in our pockets. Admittedly, by the time the tax man, the insurance stamps, S.E.T. and a hundred and one other commitments have been given priority there is not much money left. But what finally gets into the pocket is very personal. It may seem a small matter to your Lordships, but even at this late stage cannot some consideration be given to what the Consumer Council and most of the shopkeepers in this country have asked for—the retention of our humble "tanner" as a 2½p piece? I do not suppose that we shall get any cheer from the answer to this plea. In any case, it may not be long before inflation makes it an unnecessary coin—but it would be nice if we could retain it. It might even help keep down the cost of living half a point.
I turn now to another coin of our decimal system, the 50p piece. I have yet to see on any side of the House a single real friend of this coin. We all agree that the design is good; that perhaps it is nice to look at when mounted on velvet in a little box. But owing to its size and likeness to the florin, it is very unpopular. Would it not be possible for Her Majesty's Government to give a nudge to the Decimal Currency Board over this matter? I do not see why it should not be possible for the 10s. note to be preserved in the form of a 50p note. I have been told that the 10s. note is a horrible, dirty note and that it gets used up twice as fast as the pound note. But, my Lords, it is used more often because it is popular. People use what they like.
Is it not the case that what the consumer likes is good? I am a believer in supplying people with what they want. The French are very particular about their money—they even have a one-centime and a five-centime piece! If they find it possible to have a five new franc coin and a ten new franc coin in currency alone with a five new franc notes and a ten new franc note, surely we can. In any case, in this climate people do not want heavy coins in their pocket or handbags. Notes are easier 1272 to carry. I have not yet seen a reasonable argument why the consumer cannot have a 50p note —excepting the one that the note is going to be more expensive to produce.
I thought that the noble Baroness, Lady Burton, was a little unkind to the Consumer Council. Only for a moderately short time of its existence has it had the powers of advice and action behind it. I agree with her that it is very important that the Consumer Council should work alongside the Citizens' Advice Bureaux and not separately. To that extent, I think that her idea of the President of the Board of Trade working alongside these six heads is very good. I noted that she informed us that the noble Lord, Lord Donaldson, is going to discuss those considerations which, I know, have been worrying the Consumer Council and the Citizens' Advice Bureaux very much. I can safely leave that matter to the noble Lord.
I should like now to draw your Lordships' attention to the matter, already mentioned by the noble Baroness, of those recommendations of the Molony Report which have not so far been acted upon by Her Majesty's Government but with which, we have been told, they are in general agreement. These refer to the desirability of amending certain clauses in the Sale of Goods Act 1893. In Chapter 12 of the Molony Report on Consumer Protection the Committee drew attention to the many cases of buyers who were unable to get full justice in the matter of manufacturers' guarantees. These guarantees are freely given and are expected by the buying public. When we buy our new car or television set we all expect to be able to get redress, if necessary, within the period of the guarantee. By reason of the well-known name of the makers, we have probably been led to accept the guarantee as being as secure as any written word can be in our imperfect world.
In most cases we, the consumers, are satisfied that all that is necessary in the way of repair will be done. But there are certain cases, luckily not frequent, where the new buyer cheerfully signs the guarantee and returns it; but, in the words of the Molony Report (paragraph 426):He does not realise the significance of his signature being asked for to secure for himself a supposed advantage—instead of his being 1273 the recipient of an executed document. The consequence may be that he unknowingly signs away valuable rights and thus deprives himself of a legal basis for subsequent complaint.The problem of the Molony Committee was to consider whether this contracting out should be allowed to continue. After considering the pros and cons they came down in favour of accepting the need to ban contracting out. Subsequent to that Report, the President of the Board of Trade sought further advice from the Law Commission and the Scottish Law Commission in 1966. They, in their turn, had further advice from the Working Party set up in the same year under the chairmanship of Lord Kilbracken and Mr. Arthur Martin, Q.C. This Working Party also found the Molony Committee proposals justified, and they, by a majority, supported a ban on contracting out, which they said should be absolute and unqualified. The Law Commission and the Scottish Law Commission, in their Report laid before Parliament in July of this year dealing with exemption clauses in contracts, recommended that Sections 12 to 15 of the Sale of Goods Act 1893 be amended. So far as private consumers are concerned, they too supported a ban on contracting out, with the sole exception of matters applying to public auctions. Draft clauses to amend the Act were included in their Report. They even gave alternative drafts for Her Majesty's Government and the Houses of Parliament to consider.
We on these Benches should be grateful if the noble and learned Lord who sits on the Woolsack would give us tidings of when the private consumer is going to get the benefit of this suggested legislation. May I express the hope that the noble and learned Lord, bearing in mind the approaching festive season, will be able to give us tidings of joy in the form of an assurance that Her Majesty's Government will not only introduce legislation on this matter but carry it through in this Parliament.
§ 3.40 p.m.
§ LORD AIREDALE
My Lords, may I begin by congratulating the noble Lord, Lord Mowbray and Stourton, on his self-confessed "maiden speech" on this subject. I certainly agree with everything the noble Lord said about the 50p piece. At Question Time the other day, I ven- 1274 tured to suggest that it might have been better to have made the 50p piece the size of the half-crown, which is being withdrawn, instead of the same size as the florin, which is being retained. I did not get very far with the Government Chief Whip who was answering that day. I was told that I really ought to have another good look at the coin. Well, my Lords, I have had another good look at the coin, and I still suggest that it would be very much better if it were the size of the half-crown and not of a size which causes it to become muddled with the florin.
My Lords, I join with the noble Lord, Lord Mowbray and Stourton, in his congratulations to the noble Baroness, Lady Burton of Coventry, on her wide-ranging speech, with its wealth of practical suggestions, many of which I fervently hope will find favour. I cannot hope to have the wide knowledge of consumer problems which the noble Baroness has. I think the, best that I can do is to select one of these topics, one which both noble Lords who have spoken touched on, and to expand it a little. It is the matter of exemption clauses in contracts, or, as it is alternatively sometimes called, the practice of contracting out; a practice whereby manufacturers and traders sometimes introduce clauses into their contracts which exempt them from their ordinary liabilities under the law in respect of defective goods which they may supply and, correspondingly, denying to the purchaser, the consumer, the ordinary protection which the law wishes him to have in ordinary circumstances when he has the misfortune to be landed with defective goods.
I think that this is essentially a problem of the age of mass production. I imagine that in the days of horse-drawn coaches there were probably as many coach builders in the country as there are boatbuilders in the country to-day; and if you thought that a coach builder's terms of business were unfair and onerous, there was no difficulty in finding another coach builder. Of course, the trade knew this and it was a very unwise coach builder of those days who sought to impose burdensome, unfair conditions on a purchaser. But, my Lords, how different in these days of motor cars for the millions. The Molony Committee, reporting in 1962, as has already been referred 1275 to this afternoon, said this about motor cars:… the practice of contracting out is universal in the motor vehicle trade, and general in respect of electrical and mechanical appliances. In all these cases it is associated with guarantees or warranties' as the motor car manufacturers term them …I expect your Lordships are familiar with the fact that so often when you buy something like a refrigerator you get with it a rather expensively printed, impressive looking guarantee card; and you are told how important it is that within 14 days you should send this card to the manufacturers with your name and address filled in so that you may be quite sure that the valuable terms of the guarantee will be available to you should the refrigerator break down. My Lords, in many cases you would be very much better off if you threw the guarantee card into the waste paper basket and relied on the ordinary rights which the laws of England give you.
The Law Commission and the Scottish Law Commission, as we have been told, investigated this matter further. In 1966 they set up a joint Working Party, and in July of this year they published their Report which gives the conclusions of this further study of the subject of contracting out. They naturally referred back to the Molony Committee's researches, and in paragraph 68 of the Report of last July the two Law Commissions say:On the strength of the evidence which they had collected, the Molony Committee declared themselves compelled to view the practice of contracting out as a general threat to consumer interest, in the sense that 'heavy and irrecoverable loss may fall upon the consumer who is unlucky enough to get a defective article' … they found an overriding argument in favour of prohibiting contracting out'. The mischief was that this practice enabled well-organised commerce 'consistently to impose unfair terms on the consumer and to deny him what the law means him to have'.The Report goes on to say that the consumerfound it difficult and sometimes impossible to avoid submitting to the terms of business universally adopted, because he had no bargaining power of sufficient weight.In paragraph 72 the Report says:Our Working Party found themselves in agreement with the Molony's Committee's main proposal that in sales to private consumers any exclusion of the statutory conditions and warranties should be void.1276 In paragraph 75 the Commissions say.…we endorse … the Working Party's proposal for a general ban on contracting out in sales to private consumers.For good measure, in an Appendix to the Report—this has already been mentioned —the Commissions published a draft clause which they put forward as the basis for legislation. Here we are early in the Session with a good deal of Parliamentary time before us, and it would seem that there is an overwhelming case for banning this practice of contracting out. But I have to face the fact that two possible defences against acting now are open to Her Majesty's Government if they are not minded to proceed quickly.
First, the two Law Commissions are still studying the question of contracting out, even in cases of negligence on the part of manufacturers and suppliers. Secondly, they are still further considering contracting out in cases of contracts for the supply of services as distinct from contracts for the sale of goods. I should have thought that if you were in favour of banning contracting out in the case of the sale of goods you would also be strongly in favour of banning contracting out in the case of the supply of services. If you travel by public transport; if you send your clothes to a dry cleaner; if you leave your hat or umbrella in a hotel cloakroom or the cloakroom of an exhibition —who does not do all these things?—surely you are entitled to the same fair trading, fair dealing, to which you ought to be entitled if you buy goods. Therefore, I should have thought that in the interests of the consumer there was an overwhelming case to proceed now with the banning of this practice of contracting out. I do not believe that anything that could be done now for the consumer would be more worth while, and I would say to Her Majesty's Government, "Do not let us wait any longer; we have been waiting since 1962 when the Molony Committee reported. Let us get on with it now."
§ 3.50 p.m.
§ THE LORD CHANCELLOR (LORD GARDINER)
My Lords, the Government are grateful to my noble friend Lady Burton of Coventry for introducing her Motion this afternoon. It is a Motion which is always sympathetically received in all parts of the House, because we are 1277 all consumers now. Perhaps the attention which the Government pay to the question may be indicated by the fact that there are two Government speakers in what is not a long list. May I apologise, in case I forget later, for the fact that, owing to engagements which I am unable to escape, I may have to leave before the end of the debate. May I also apologise for the effect of the Act of King Henry VIII, which always makes me seem so discourteous to the Liberal Benches behind me.
My noble friend Lady Phillips will reply to the debate as a whole and I do not propose to deal in general with what I might call the Board of Trade problem. I have always felt strongly—and I think most judges and lawyers do—about the so-called guarantee. The noble Lord, Lord Airedale, is of course quite right in saying that the primary object of giving a guarantee with a beautiful scroll on top, and of getting the buyers to send a card acknowledging having received it, is to take away the Common Law rights which we should have as buyers, if we had not been foolish enough to accept the guarantee.
I was delighted, I remember, when my right honourable friend the then President of the Board of Trade asked the Law Commission to go into the whole subject. As your Lordships know, they reported in July—another example, perhaps, of the good use of the Law Commission. These are entirely matters for the Board of Trade and not for me, though it is correct, as my noble friend Lady Burton of Coventry said, so far as inertia sales are concerned, that Mr. Davidson has drawn sixth place in the ballot in another place. That is a good augury, I think, for his success.
I propose to deal mainly with what I do know, which is the problem of the courts in relation to small claims, the legal problem there enforceable. The case which is made in relation to that is that there is too much difficulty, cost and uncertainty for consumers fighting small claims. The broad answer is that it is what in another context lawyers would call a true bill. I think it is right. It is said that when people go to a solicitor they are advised not to press a small claim. The complainant says that the thing does not work properly, that there is some defect. But the solicitor replies 1278 that there is not a lot of money in it: it is something less than £30, that expert evidence would have to be called, and that it is not worth while to litigate about a small amount like that. I think that this does happen. The sample given in the inquiry made by the Consumer Council was a very small sample of about 2 per cent.
The report of the inquiry commented on the fact that nearly all county court actions seem to be by firms and companies, rather than by individuals; by firms against individuals, rather than by individuals against firms. But the county court is primarily a debt-collecting court. To most claims there is no defence at all, and where a defence is filed it is sometimes put in by consumers simply to gain time. But the general complaint is, I think, justified. The question is: what is the remedy?
If I may take first those suggested by the Consumer Council, my noble friend asked me to say something about small claims courts. It is right that in America, in some States, at all events, there are small claims courts which are held in the evening. Usually, nobody is represented; the person who decides is a lawyer who does it for nothing in his free time. At first sight, this idea sounds attractive, but the article in Focus also demonstrated the difficulties. It said that these courts are used by ill-educated or illiterate people and that, being unrepresented, they have usually left the more relevant documents at home. It is all very rough and ready, and often the consumer is pushed into some sort of compromise which does not really do justice to his case. There would be a further difficulty in this country, in that the proportion of lawyers in America is immensely higher than the proportion here. As your Lordships may know, we are very short of lawyers. All solicitors are over-worked and I think would not have time to do work of this kind. They are all doing as much as they possibly can, and they are short staffed.
The same article suggests that there should be local advisory services. I am not an expert on consumers' organisations, though a great admirer of them from a distance; and I also admire the C.A.Bs. It is suggested that the county court registrars should act as conciliators. In fact, they already do, if they can get 1279 a sensible settlement. In my experience, the registrars and county court staffs are extremely good at helping those who are not represented. It is then suggested that there should be arbitrators. The experience of lawyers about arbitrators—and we have had a good deal of experience—is that in the end they do not turn out to be any cheaper than the courts. If parties have lawyers, they have to be paid; and the arbitrator also has to be paid, whereas the judge does not. It is an illusion to think that arbitration is cheaper.
It is also suggested that there should be neighbourhood law firms. I have been fully into this point, and I do not think that such a scheme is at all well suited to our problems here. We in this country have a proper system of legal aid, and there is no legal aid in the United States. I think that the answer is simply that we should extend legal aid and advice. We have already extended the jurisdiction of the county courts, and if all the recommendations of Lord Beeching's Royal Commission are accepted it will be extended still further. That means that actions now tried in the High Court will be tried more cheaply in the county court. As my noble friend said, only this last Session we have doubled the jurisdiction of the registrar, and your Lordships may remember that it was only in the last Session that I made some Orders applying legal aid to forms of proceedings to which it had not been applied before.
When we are talking about extending legal aid we have to look at the background, and the first thing we have to recognise is that in this country we have an appalling shortage of lawyers. There are parts of the country where there are simply not enough barristers to go round; and, as I have said, solicitors are all over-worked. Departments are advertising for lawyers and cannot get them. There are many unfilled Government legal posts. The only people who can get lawyers are the Law Commission—perhaps because the work is so interesting. We are short, as we all know to our cost, of Parliamentary draftsmen. While some of the complaints made against solicitors, that they do not seem to get on with doing what clients want them to do, are justified, the main reason is that they simply cannot meet all the work 1280 they have to do. That is one background fact which we have to realise.
When it comes to county court work, the suggestion that solicitors shy off county court is true; and for a very simple reason. The Prices and Incomes Board have recently reported that in their view some of the charges made by solicitors who do conveyancing of large properties are too high. That statement, naturally, the Press widely publicised. What the Press have not publicised is the equal finding that solicitors lose money on every county court case they undertake. This is for the simple reason that their charges have not been increased for thirteen years. Do any of your Lordships know of any other group of men, whether professional or otherwise, whose charges in some field have not been increased for thirteen years? Naturally, solicitors lose money, and in their Report the Prices and Incomes Board says, in paragraph 34:Some firms are refusing to take on county court work, and this would apply particularly to smaller cases where the level of fees is known to be specially unremunerative. From the returns in our present survey, we find that three firms in every ten appear to have no county court work at all. This figure is based on a single quarter and cannot be taken as representative of a full year, but it is clear that the proportion is now higher than in 1966 when it was only about half as great. This roust give cause for serious concern, and indicates that a realistic solution to the problem of county court costs is urgent and should be put into effect with the least possible delay.This is obviously part of the difficulty. I never like refusing to see anybody. A group of solicitors wanted to come and see me recently. I did not recognise the name of the man who wrote to me, but I saw them—there were some six or seven of them. When they came I found that they were old friends of mine, in the days when we were all young together in the Haldane Society or in the Society of Labour Lawyers. They were all solicitors who act almost entirely for employees and not employers, or for tenants and not landlords. When they have litigation, they litigate in the county court and not in the High Court. If they do conveyances, they are few and at the lowest end of the scale, which the Board recommend ought to be increased. These solicitors were wondering how long they could stay in business. They regard what they do in life as partly a social service. They do not like to say 1281 to a client: "I am sorry, but I cannot take a county court case because I shall only lose money on it". They simply take the case and lose money on it. They were wondering how long they could go on doing this. It is not much use saying to solicitors like that: "The West End solicitors who do conveyancing for large properties are making too much money." This, I think, is the real answer—legal aid and legal advice.
Then I have, in conclusion, to say something about finance. I do not think there is any doubt that our system of legal aid is the best in the world. We used to have this silly system under which if a man was really poverty-stricken he got the action done for nothing, but otherwise he could get no help to all. Now a man has to contribute what he can, but the State will pay for the rest. This is surely an elementary feature of justice —because what is the good of passing Acts of Parliament giving people legal rights if they cannot afford to enforce them? If you cannot afford to enforce your legal rights, you may as well throw them into the wastepaper basket. It has worked admirably.
In the end, of course, there is something for the taxpayer to find. Most accident injury claims succeed; the defendant pays the costs, and the action does not cost the State anything. Most of the money the taxpayer has to find goes on undefended divorce, where the petitioner is a wife and cannot make any contribution because she has not the money to do so. But legal aid has been gradually extended. It started in relation to most actions in the High Court. Then came the time when a Government said: "You can have a bit more money for legal aid", and aid was extended to county court actions. Now it has been extended to what one may call the civil side of magistrates' courts. Then there were these three or four additional kinds of action to which we extended it by Order this last Session.
My Lords, the financial position is that, having started in 1950, until 1960–61 what had to be found was always £1 million-plus. The amount went up every year, but it was always roughly that figure. Then the next year it was £2 million; the next year it was £3 million; the next year it was £4 million; the next year it was £5 million; and the next year it was £6 mil- 1282 lion. Then, of course, legal aid was introduced for criminal cases, and I think the current figure of the amount to be found is about £9,900,000. Extending the system is simply a question of finance.
My Advisory Committee, of which the noble Baroness, Lady Emmet of Amber-lay, is chairman, made a report, some time ago now, recommending, first, that there should be an alteration of the basic figures, particularly for the lower limit, because those figures have not been changed for nine years; and, secondly, that legal aid should be applied to proceedings before the Lands Tribunal. But it is all a question of amount. As your Lordships know, Government expenditure has to be curtailed, and it is a matter for consideration by each Government, and particularly my right honourable friend the Chancellor of the Exchequer, whether we can do it.
Legal advice has never really got properly started. You go to a solicitor, and if your income is less than a certain figure you can get his advice for a sum that you can pay. One of the difficulties is that what the solicitor gets has never been increased; and here again the Prices and Incomes Board say, in substance, that what the solicitor gets should be doubled. But we really do not get in early enough. It is a difficult problem. How do you get in touch with the poorest section of the community of all? If they have a contract when they buy something, and do not read it, they do not know that they need legal advice. This, as I say, is a difficulty. We must, therefore, expand legal advice in every way.
Taking full advantage of the Citizens' Advice Bureaux, the Law Society have put forward a very practical scheme which would lead to a great expansion of legal advice to the people who most need it. My Legal Aid Advisory Committee are even now in the middle of reporting to me on this, and I hope to be able to publish their report next month. The Law Society's scheme seems to me an admirable one, but it would cost £2,400,000 a year. No doubt it seems a shame that lawyers require to be paid for what they do, instead of not charging anybody and living on nothing, but I am afraid that if one wants somebody with the technical qualifications one has to pay for them. This is the basic difficulty. 1283 When a lawyer says that it is not worth fighting a case under £30 because of the costs, he is right. I was a little surprised when my noble friend Lord Silkin, in an observation referred to by my noble friend Lady Burton, complained that it seemed ridiculous that an action involving about £100 might involve costs of £100. Whatever the cost is, it is not due to the fact that lawyers charge too much, because the Prices and Incomes Board have shown that they do not get enough. I repeat, it is a question of finance. Nobody is more anxious than I am to see that both legal aid, particularly at the level of the lowest cases—because if the consumer is right he wins his action, and his costs, and therefore the Legal Aid Fund's costs, too, will be paid by the loser—and legal advice are greatly extended. My Lords, I conclude by saying again how grateful we are to my noble friend Lady Burton for having introduced the Motion this afternoon.
§ 4.10 p.m.
§ BARONESS ELLIOT OF HARWOOD
My Lords, I also should like to thank the noble Baroness, Lady Burton of Coventry, very much for introducing this debate, and for the most thoughtful and interesting speech which she has made, to which I have listened with the greatest possible interest. The noble Baroness is, if not the greatest. certainly one of the greatest experts on this subject, and has done more than anyone to bring the matter in front of the public many times. It so happens that we have not had a debate in this House on consumer affairs since the debate that I think she inaugurated (or perhaps I inaugurated it, I am not quite sure) in 1966—quite a long time ago. So to-day is an opportune moment for us to review these questions. In taking part in this debate to-day, I speak for the first time not as a member of the Consumer Council, or as its Chairman, since I gave up the chairmanship about a year ago.
Before I come to deal with one or two points which the noble Baroness has raised, and which I think I can deal with since they were matters which were raised originally when the Council started, if the House will bear with me I should like to say one or two words about the work of the Consumer Council to-day. I have in my hand the Report of the Council, which I think is excellent reading. I 1284 should like to congratulate my successor, the noble Lord, Lord Donaldson of Kings-bridge, and his excellent staff, on the work that they are doing and plan to do in the future. The Report is very good reading indeed when you think that it is only the sixth annual review of this organisation. It takes a long time to get a new organisation established in this country and, as I say, this Report is excellent.
There are one or two matters I should like to pick out from the Report, because they follow on so much what I hoped would happen when we started some five or six years ago. There is a large section on personal service to the individual, and a whole range of subjects which are of the greatest possible value to individuals. The first group is the health and safety section, dealing with food standards and labelling. This is a most important matter, as has only recently been brought to our notice in connection with the use of cyclamates in various foods. Then there is an excellent and interesting paragraph about children's clothing, and about the changes to alternative sizes (which we always wanted) not based on age, but on height, weight and the actual size of the child.
There is a paragraph about the safety of electrical appliances and their uses, and also a paragraph about safety of toys. We began dealing with these matters about five years ago. They have now become part and parcel of the work, results have been established and are of value to the individual. There is a section in the Report dealing with the market place, and many subjects listed there are extremely interesting. Of course, they are new subjects which did not arise when I was Chairman.
I notice that the Council have not been successful in trying to prevent the closing of banks on Saturdays. This occurred in Scotland a year before it occurred in England. I knew at the time that it would be exceedingly inconvenient for ordinary people, for whom Saturday was the one day when they could get to the banks, but we could do nothing to prevent this happening, and I am afraid that the people in England are having just the same disagreeable experiences as we have had in Scotland for the past year and a half. Many interesting studies have been carried out on various important matters. 1285 There are studies on carpets, for in-stance, about which many complaints were always being sent to us. There are studies on footwear, which is another matter that is continually coming up. There is a new section about transport, which interested me very much, with questions connected with taxicab companies and the public.
These may sound small things, but I am picking out only one or two that were new to me and interested me very much indeed. There is a paragraph about the House-builders' Registration Council. There are now 11,000 builders registered, which is a splendid increase, and a matter which shows how important it is that we should try to keep the standards in house building as high as possible. The Consumer Council have helped tremendously in backing that Council. There are also paragraphs about the TELTAG scheme, which interested me very much. It is only just starting, but it is off to quite a good start. The noble Viscount, Lord Hanworth, is speaking in this debate, and I know that he is largely responsible for this section of the Consumer Council work, and hope he will be able to tell us more about it.
There are one or two matters which I think the noble Baroness, Lady Burton, touched on, and on which I should like to elaborate. I was delighted to see in the Report emphasis laid on the education of the consumer. This aspect of the Council's work is of enormous importance. I entirely agree with those who have said that an informed and knowledgeable buyer is just as important —and is more important to the manufacturer and retailer—than any other kind of buyer. As the noble Baroness has said, when shoppers complain and when inquiries are made as to what the complaints really stand for, it is often found that the goods or equipment purchased, if of a durable character, like electrical equipment, has been badly and wrongly used, and naturally the result is not satisfactory. Only an educated and informed shopper can avoid those pitfalls. This is one of the subjects to which the Council is devoting a great deal of attention.
How can the Council do more? How can they be more important and helpful in this whole field of consumer work? The noble Baroness, Lady Burton, has suggested that more can be done. Every- 1286 body will agree that always more can be done, and those who are enthusiastic in this matter are always anxious to do more. But there are difficulties, and I should like to say one word on the subject of finance. The total budget of the Consumer Council, for all the work it has to do, is only £231,800-odd. When you realise that the Council is working in the commercial world, the advertising world, the world of huge retailers, and so on, that tiny sum is minute compared to what is expended on advertising or what is expended in the commercial world on selling to the public goods and services in which the public are interested. It is true that the Consumer Council is not selling anything. But it is selling itself, and that is very important indeed. It means that when you have a budget as small as that you have to choose all the time on what you spend your money. There are any number of things one would like to do, but when it comes down to financing inquiries, or financing whatever it may be in the interests of the consumer, and in helping the Council, it is impossible to do everything. So you have to choose; and the choosing has to be done with scrupulous care. It also means leaving out, and there is a great deal one would like to do but which one cannot do because something has to be left out.
There is one Association of which I am vice-president and which is one of the co-operative organisations, the Consumers' Association. This is a splendid organisation, as we all know, and those of your Lordships who subscribe to their magazine Which? will know that it has a huge circulation and does very valuable work. But when I tell your Lordships that the current Annual Report of the Consumers' Association states that the sum of £300,000 is expended on membership and on Which? alone, it gives you some idea of the difference between the amount of money available for the Consumer Council and the amount of money which is spent on that one item by the Consumers' Association. I do not grudge it to them, because I think it is an excellent publication and they do a splendid job. But it is only one item with which they deal. The Consumer Council has £231,800-odd to do everything.
The second matter is one to which the noble Baroness, Lady Burton of 1287 Coventry, has referred and about which I should very much like to talk. I mean the methods by which complaints from consumers are dealt with and reach the Council. The noble Baroness is absolutely right when she quotes the Molony Committee's paragraph on the subject of the Citizens' Advice Bureaux. When I took over the chairmanship of the Consumer Council, as the first Chairman, the first thing we did was to work in very close touch with the Citizens' Advice Bureaux. I made many speeches, up and down the country, in those first years in which I said that the Citizens' Advice Bureaux were the eyes and ears of the Consumer Council. and everything we could do to help them we should do; and I hoped that they would pass on to us their reports, and so on, so that we should be able to help them.
As the noble Baroness, Lady Burton, said, this has not worked out in exactly the way which I, as the first Chairman of the Council, and she, as one interested in how consumer complaints can be dealt with, would have liked. There are one or two reasons for this which I can explain. The noble Baroness said, perfectly correctly, that the Consumer Council, by its constitution, is prohibited from dealing with individual complaints; it cannot do that, and has never tried so to do. The Citizens' Advice Bureaux are the people to deal with individual complaints. But they have often said to me—and I am sure they would be the first people to support this view—that they are often hampered by not having enough expert knowledge on the spot to deal with difficult individual problems. The noble Baroness has said that she thinks they deal with about 90 per cent. of the cases reported to them, and that about 10 per cent. are beyond their powers. This is in a way a very fine percentage, because 10 per cent. is quite a reasonable number. On the other hand, 10 per cent. of dissatisfied complainants can make a great deal of trouble.
One of the difficulties about passing on information by the Citizens' Advice Bureaux to, let us say, the Council or any other body is that the Citizens' Advice Bureaux are not allowed to pass on—or at any rate they do not do so—any names of firms or people who are being complained about. No name of an 1288 organisation or of a commercial firm or any other name is ever passed on. They operate like this because they wish to be considered an impartial body, and therefore do not want to be involved in any kind of controversy with a commercial firm or any other service about which there is a complaint. That attitude is perfectly understandable.
However, when it comes to the Citizens' Advice Bureaux passing on information to the Consumer Council and asking them if they will take up the complaint, the Council are of course enormously handicapped by not knowing who is said to be at fault or is being complained about. Again, the Council do not wish to take sides in any complaint until they know the rights and wrongs of the case. On the other hand, supposing there is a complaint about, say, "inertia selling", or doorstep selling, or anything else which is highly irritating to the public, if the complaint is passed on in a vacuum, with absolutely no method of pinning down who the offending seller is, what can the Council do to put it right? The position is very difficult indeed.
Unless it is possible for the complainant and the complaint to be identified, I do not think it is possible for the Consumer Council to deal with the complaint. This is one of the reasons why the present setup has not worked. It has not worked, with all good will on both sides, because if one side does not give a great deal of information, the other side has largely to work in a vacuum: and this is very difficult indeed. I think that if one is going to take up complaints one must know who the offending person is; otherwise I do not quite see how the matter is going to be dealt with.
As the noble Baroness, Lady Burton, has said, what has happened is that complaints have come only sporadically through the Citizens' Advice Bureaux, but more and more people get in touch direct with the Consumer Council office. On page 33 of the Report that I have here your Lordships will see that the number of direct contacts between the public and the office is growing every year. Whether it is done by letter, by telephone or by personal approach of some kind, this method of contact is going on all the time, and the Council are therefore able to deal directly, by letter or by telephone, with some complaints. The way in which the information from 1289 the Bureaux is handled, in addition to the cases which the Council handle themselves, is that it is passed on where it can be, but without any particularisation of the difficulty.
One of the ways in which we could improve on this method would be by seeing that the Consumer Council have offices in other places besides London. I realise that this would involve slightly more expense, but it would enable the Council to be much more accessible to the public, and I believe that this would be valuable from the consumer point of view. I was interested to see in the Report that the first area where the Council would like to work is in Scotland. This would be excellent. I cannot believe that it would he very expensive; not a very big office would be needed, just a small office. It would be able to keep in close touch with the other consumer organisations and would also be a centre, as the Consumer Council in England is a centre, for opinions and work. Matters could then be dealt with much nearer to the public than would be the case if the only offices were in London.
I remember that when I was on the Council we hoped to have a number of regional centres. We should have liked, for instance, to have centres not only in Scotland and in Wales, but also in either Manchester or Birmingham, the great Midlands area, and possibly in Bristol or elsewhere in the West. It seems to me that if we embark on a reorganisation of local government, as it appears we may do, both in Scotland as a result of Lord Wheatley's Report and in England as a result of the Redcliffe-Maud Report, now is the time to consider whether or not in the new regional set-up there should be some regional offices of the Consumer Council. I am quite sure that they would pay handsomely in a return to the public and also in a return to those who are interested in consumer affairs.
§ LORD DRUMALBYN
My Lords, will my noble friend allow me to ask her one question? I should like to know exactly what she is proposing. Is it her proposal that in future these regional offices should be able to deal with particular individual complaints from consumers, and that the terms of reference of the Consumer Council should be altered to enable them to do so?
§ BARONESS ELLIOT OF HARWOOD
I cannot speak for the present Council because I am not on it, but certainly when I was on the Council we did not envisage altering the constitution in order to deal with individual complaints. We thought we should be much nearer to the commercial, retail and servicing worlds and to the local authorities if we had a regional office than if we always operated from London. The noble Lord:, Lord Donaldson of Kingsbridge, may be able to answer that question better than I can, but I do not think we had actually considered altering the principle of not dealing with individual complaints, because that would mean cutting across what is done by the Citizens' Advice Bureaux to some extent, and we should not want to do that. Also I think it might entail employing too many people in the office.
The noble Baroness, Lady Burton, mentioned co-operation between the organisations dealing with consumer affairs. I do not know whether she realises how much co-operation there is. It may be three years ago now (indeed it may be four) when the membership of the Council was being reviewed—I think three people go cut every third year, although I am not quite certain what the constitution is at the moment. We took great trouble to get someone on the Council who, I notice from the annual report, is still on it at the present time. I thought it would be very useful to have him on the Council, because apart from the fact that Professor Beresford is a highly knowledgeable person in many fields, he happens to be the Chairman of the Yorkshire C.A.B.
In the other organisation, the Consumers' Association, we used to have, and I think it is still carried on, a meeting between that Association and the Consumer Council every year. The two Councils met, we had a tremendous heart to heart talk and we made plans in which we indicated to each other the lines on which we thought we could best co-operate. We were not trying to do the same things, because that would he absolutely useless, and in any case the Council has no money to do the things done by the Consumers' Association. However we had those regular meetings and I think they still continue.
In regard to Weights and Measures and local authority services I must, in those 1291 five years, have addressed at least eight or ten meetings of Weights and Measures inspectors. I toured the country, having general meetings with people interested in consumer affairs, and always inviting, of course, all the organisations that were interested in this subject. Those meetings grew in momentum. We started with rather small meetings, because then it was only in the initial stages. I vividly recollect the last meeting I addressed—and I may say this was not because I was the speaker. It was at Newcastle, and we thought we were going to have 200 or 300 people present. It turned out, however, that the number of people who wanted to attend was so great that we had to take a hall to accommodate the 900 people who were present. So in one area alone—the North Eastern Region —there were 900 people interested. I thought that was gratifying. I see in the annual report that this type of co-operative meeting is being continued. There are reports of two—one in Sheffield and one in Bristol—which also, I believe, were on rather a large scale. So the Weights and Measures inspectors and the local authorities are all brought in, so far as is possible.
Every time I went to a meeting I also addressed—or hoped to address—a group of the C.A.B. I remember doing that in Birmingham, Manchester, Liverpool, Bristol, Newcastle and Edinburgh—I cannot remember any more. but I vividly remember having special meetings with the workers in the C.A.B. and having as close co-operation as I possibly could. We tried to have as wide a spectrum as possible of organisations interested in and dealing with consumer work. There were also other organisations, such as the Electrical Association for Women and the Gas Council. I am sure this co-operation is still carried on.
I have here a most interesting article by Mr. Roger Diplock of the R.T.S.A. I entirely agree with the noble Baroness, Lady Burton, that nobody has done more work or been more helpful to the retail trade, or to the consumer, than Mr. Diplock. At the end of the article he says:When some of these questions have been discussed in depth in the House of Lords, it may perhaps be realised that the great majority of retail establishments not only pro- 1292 vide sound service to sensible shoppers but would be out of business very quickly if they did not.I cannot tell your Lordships how much I agree with those sentiments. Of course, the retail trade does give wonderful service to shoppers. In all the work which the Council do, in all the publications which they distribute and, I imagine—it was certainly so in my day—in all the speeches made up and down the country, it is emphasised that there is no question of organising a build-up against the retail trade. On the contrary, I always stressed that it was in the interests of the producer, the retailer and the consumer that there should be co-operation on all sides and, above all, an educated and intelligent shopper. This is the aim; and these three elements in consumer work are in no way antagonistic.
The noble Baroness, Lady Burton, has referred to the voice of the consuming public: how can it best be heard, and what are the best methods of achieving this? I believe that it is heard to-day far more than it has ever been heard before. In all our legislation someone in every Government Department must ask himself: "What will the consumer think about this piece of legislation?" On that point I should like to pay a tribute to the noble Baroness, Lady Burton, because she was the first person to make us consumer conscious, which she did by her staunch work in another place when she was a Member of the House of Commons. To-day it is rare not to find somebody looking at the consuming end of any legislation that is brought before Parliament.
Reference has been made to the Trade Descriptions Act, in which I took an active part and which I think, with certain reservations—namely, Section 11, as the noble Baroness, Lady Burton, has said —has been a great help to shoppers. I believe that the appointment of the consultative committees, if only they had more power, is an example of the nationalised industries' desire to consult the public. Incidentally, the Consumer Council carried out an interesting study on these consultative committees and came up with some excellent suggestions. Whether or not those suggestions have been acted upon I do not know, but the very fact that in the nationalised industries consultative committees are now 1293 established goes some way towards ensuring that they are all the time thinking about the public. But, of course, these committees have not enough power; as I think I said before, they have no real teeth, and it is time they were given more statutory power than they have to-day.
Then again, more and more is being put on the weights and measures departments of local authorities. Consumer protection is extremely important, and the weights and measures officers and their work are very important to the consumer. So I think that, on the whole, if one looks back one can say that a lot has already been done. That a lot more could be done is, of course, obvious. But unless more money is available, so that the Council can do more and do not have to reject so much because the necessary money is not there, the Council will always be hampered. I think it is amazing that the Council do as much as they do on as little money as they have, and I should like to congratulate the noble Lord, Lord Donaldson of Kings-bridge, and the officers of the Council on what they do.
Whether anything more would be achieved by the suggested meetings, as put forward by the noble Baroness, Lady Burton, at the end of her speech, I do not know. Certainly there is no harm in trying. One can always have conversations and discussions, and see whether anything better can be done. But in the nature of things, although the co-operation is being built up over the country, there is the difficulty of passing on information from the C.A.B. to the Council because of the nature of the way in which the C.A.B. work, which I think was not appreciated by the Molony Committee when they made these proposals. I believe that the C.A.B. do a splendid job. If they had more money they would do more. Nobody is more enthusiastic in their support than I am. But this liaison between the two, although it is there, is not as successful as it ought to be, because of the nature of the way in which the C.A.B. work, never divulging any names. not enabling the Council to "get after" any particular organisation or shop or commercial interest, or whatever it may be, to follow up these complaints.
1294 So, my Lords, I think that, given the difficulties and the lack of funds, and the fact that there is such a huge field, the amount that has been achieved by the Council is very remarkable. I congratulate the noble Lord, Lord Donaldson, and those who have contributed to this success, and I wish them every possible good fortune in the work still ahead of them.
§ 4.43 p.m.
§ LORD DONALDSON OF KINGS-BRIDGE
My Lords, I understand that a certain newspaper, not one which crosses my breakfast table, suggested yesterday that it would be improper for me to take part in this debate as I am the part-time salaried Chairman of a public body concerned in the subject. This naturally concerned me. I have taken advice by studying the Addison Rules and the other hints contained in the little red book for the proper behaviour of Peers; I have consulted the Clerk of the Parliaments and my own Chief Whip, and I have consulted the President of the Board of Trade, whose predecessor appointed me, and none of those sources have suggested that it would be anything but right and proper for me to intervene. So ultimately one has to make one's own decision. I have made it and I am speaking. I think the House was the poorer for riot hearing my noble friend Lord Aylestone and the noble Lord, Lord Hill of Luton, in the broadcasting debate, and I am not following their example.
This is not a debate on the Consumer Council; it is a debate on consumer affairs. If it were necessary to expand on the work of the Consumer Council, this has already been done amply, first by my noble friend Lady Burton, in her opening remarks, by the noble Baroness, Lady Elliot, my predecessor, whom I am always glad to follow, whether as Chairman there or speaker here, and by the noble and learned Lord, the Lord Chancellor, in his reference to the small claims investigation. Any information your Lordships may require about the Consumer Council I feel you have, one way or another, already had.
I must declare two rather conflicting interests. First of all, I am Chairman of the National Executive Committee of the Family Service Units. Here we are constantly concerned with standing up for the family which has failed to look after itself and has fallen for the blandishments of 1295 efficient salesmanship, so that it is swamped by claims it ought never to have incurred and is heading for disintegration. There we are concerned with individual cases, and one could describe it, I think, as consumer protection taken to the extreme. I have seen too many cases where foolish families were bulldozed in their own houses into buying things they did not need and could not afford, to have much love for the honey-tongued salesman or indeed his cold-hearted employer.
The second interest which I must declare has already been referred to: that I am Chairman of the Consumer Council. We in the Council are concerned not with the particular but with the general, not with the merely protective but with the positive. Throughout its life the Council has been acting on a number of fronts lo curb the excesses of salesmanship which lead to debt and distress. But it is not concerned, and it is not allowed to be concerned, with the individual case. Its task is prevention rather than rescue.
It is concerned essentially to try to redress the balance of size which enables modern businesses to employ, perfectly properly, large legal departments and expert lawyers and pit them against the inadequate information available to the private citizen, and to employ large sums of money in their own interests which cannot be matched by the private individual in any way. When one sees the havoc wrought among families whose worst crime is lack of resistance to the spurious charms of the salesman, one is tempted to clamp down altogether on the kind of trading which leads to it: to ban credit buying, to suppress doorstep selling. But, of course, this would be absurd. We must above all things widen the choice of goods and services available to the public; make it easier for them to shop, perhaps by removing restrictions on shopping hours; make it easier for them to buy, perhaps by making credit terms less onerous. We must work by easing restrictions and not by increasing them.
Having disclosed these somewhat conflicting interests, which sometimes pull me in different directions, let me go on to thank my noble friend Lady Burton for having opened the debate in such an illuminating way, and in particular for painting it in on such a very wide canvas. 1296 We are not confined in our debate to consumer protection: we are concerned with information, advice, education, and all other constructive sides of this work. My noble friend has asked me some specific questions, which I will answer in due course; but first I should like to make one or two remarks of a general kind about the problems which confront those who concern themselves with trying to redress the balance in favour of the consumer.
Since the last war there has been an enormous growth in consumer consciousness, stimulated by greater opportunity, more money and the gradual removal of war-time restrictions. The statutory existence of consumers was first recognised, I suppose, in the Acts establishing the nationalised fuel and transport industries, under which consultative committees were set up. They were followed by voluntary and, on the whole, more vigorous organisations—outbursts, one might say, of consumer zeal. The Consumer Advisory Council of the British Standards Institution, with its Shoppers' Guide, was the first in the field, followed closely by the Consumers' Association, with Which?; and their success story seems to me to epitomise the whole growth of consumer awareness, at any rate of the more sophisticated part of the population. Which? now has a circulation of 600,000, and it claims to be read by 3 million people—no mean achievement in, I think, about twelve years.
There are about 80 consumer groups throughout the country, numbering some 20,000 members. That reflects a spontaneous generation of interest in this particular subject; a rather remarkable growth. Finally, in 1963, in response to the recommendations of the Molony Committee, the Consumer Council was set up by the Government. It is not a statutory body; it has no legal powers, but it is not exactly voluntary, either. It has no members, and it does not sell its services. It is financed by the Government, but most jealously preserves its independence and its right to come out strongly against Government policy when, as I regret to say sometimes happens, it thinks that the Government are wrong.
At the same time as this proliferation of consumer organisations there has been a leap forward in consumer legislation. 1297 We have had fairly detailed discussion already of the Trade Descriptions Act. I should like to say here that I endorse the misgivings of my noble friend Lady Burton about Section 11. I think that few noble Lords in this House were happy about that section, and it does not appear to be working very well. Otherwise, it seems that the Trade Descriptions Act is doing more or less what it was intended to do, which is a great deal; and I think, particularly from the point of view of the Consumer Council, the added zest and force given to the weights and measures authorities has been most remarkable and satisfactory.
Earlier, I referred to the first of the two basic problems which I see in assisting the consumer; that is, keeping the balance between freedom to compete for the consumer's custom and curbing excessive zeal which leads to abuse of the customer's confidence in the trader. It is difficult to protect the gullible without protecting the rogue, and it takes very accurate drafting to legislate to protect the innocent without unduly clipping the wings of imaginative salesmanship. Every time a Bill of this kind is brought in, after a year or two one finds the holes.
The second basic problem is how to reach the shopping public at large. We know that the Consumer Council's penetration is not as deep as it ought to be. In spite of the fact that it prints and distributes pamphlets and leaflets to the tune of millions, issued free through the C.A.B., through health clinics, through shops and stores, through women's organisations and through multifarious channels, its penetration is too shallow. As the noble Baroness, Lady Elliot, pointed out—and it would be out of place for me to stress this-it simply does not have the funds to compete more prodigally. Television advertising, which is generally thought to be the one thing which really does work in this country, is right outside its range. It has to rely largely on editorial publicity in order to give the warnings and advice which it wants to give.
The noble Baroness asked me whether I could tell the House the amount of money spent by the Consumer Council on publications and publicity. I should be happy to do so. In 1968–69, it spent £58,000; in 1969–70, it expects to be able 1298 to spend only £53,000. This includes a miserable £20,000 for promoting its informative labelling scheme, TELTAG. For the moment that is all it can afford. That does not mean that it cannot or does not speak for consumers at large in its representations to Government Departments, to trade organisations, to particular firms and to the Press. It takes a great deal of trouble to find out the experiences, as consumers, of representative samples of the population.
My noble friend Lady Burton referred to the research projects listed in the Council's Annual Report, and asked what they cost. They cost about £7,000. And in 1969–70 it expects to spend about £6,000. This, of course, is just chicken feed. But the surveys which are carried out in this inexpensive way are respectable and statistically valid, and based on the population as a whole, not just the middle-class intellectuals, whom it is sometimes contemptuously said are its only supporters, and people represented by the Council. It is worth while remarking here that even when agitation for reforms, whether statutory or voluntary, comes only from the concerned and articulate section of consumers (which it is fair to say it usually does) it is none the worse for that, because every time an abuse is nailed, it is nailed for the harassed housewife in overcrowded conditions as well as for the people who enjoy more gracious living.
The removal of exclusion clauses, about which the noble Lord, Lord Airedale, spoke, and with whom I entirely agree, is something for which the Council has campaigned ever since it was set up, and it is most gratifying to know that the Law Commissions have now reported in its favour. This will help everybody, and not just the more sophisticated. This is a most important matter. The work which is being done on the legal system on small claims, which my noble and learned friend on the Woolsack discussed in some detail will also help. Research into small claims work is being carried out at the moment by the Consumer Council and is only half way concluded. As the noble Baroness mentioned this point particularly, I will make a brief further reference to it; but the Lord Chancellor dealt with it so fully that I shall not spend long on it. As a result of the researches not yet finished it has been discovered that about 70 per cent. 1299 of actions in county courts are initiated by firms against consumers for debt, for goods or services. In this particular section of research, cases brought by consumers against firms were unable to be found. Individuals do not use the courts because the process is too expensive and too daunting. The system is not geared to an ordinary individual's bringing his own case, which is the only way to keep down expense.
The noble and learned Lord on the Woolsack referred to the American small claims courts. I do not suggest that they could be imported wholesale into this country. However, I do not accept the noble and learned Lord's allegation that all forms of arbitration are as expensive as ordinary forms of litigation. I certainly do not think they need to be. No doubt if they are wrongly conducted they may be; but I think it is most important not to accept the situation of the impossibility of bringing a case for £100 without spending £100. It really will not do. If that is the best that we can do we must think again. Thinking again means doing something quite different and doing something quite different probably means doing something not altogether different from the American plan. At least the parties can tell their own story to an independent arbiter and get a judgment, albeit one with which they may not be satisfied but which at least costs them virtually nothing.
We have already been told about the difficulties which confront the Consumer Council and the C.A.B. in the co-operation which Molony anticipated. My noble friend Lady Burton was absolutely right—and the noble Baroness, Lady Elliot, has confirmed this—when she said that this is not working in the way it was supposed to work. My own view is that the Molony Committee were wrong in thinking that it ever would work. I believe that it was not the right answer, because I do not think that people who are expert at social service, which is a difficult and demanding function, are necessarily particularly good at the rather niggling side of dealing with claims, with watches that go wrong and things of that sort, which in regard to 90 per cent. of the cases they deal with satisfactorily by ringing up the firm who are quite happy to put the matter right, but when 1300 there is something really wrong, which is what we want to get at, they are not able to do it. Of course, the confidentiality has made the information passed to the Consumer Council almost impossible to work on.
The Council is not allowed to deal with complaints. The C.A.B. are not equipped to deal with complaints. The county courts are too expensive and nobody will use them. So you are left with a major fault in the administration of consumer affairs, which quite rightly my noble friend has raised.
It may be that with the new powers they have under the Trade Descriptions Act, the local authorities will provide the necessary point of contact. Sheffield and Bristol, as we have already been told, in rather different ways are running consumer advisory services fairly successfully, and some twenty other local authorities, in different places and in different ways, are doing something about this along the same lines. The difficulty is that the weights and measures inspector, who normally the local authority employs on this matter, finds himself acting both as policeman and as supervisor. As we know from the experience of the National Agricultural Advisory Service some years ago, this is a very unhappy association, so that the answer is not obvious at the moment. I do not know what is the right solution, but in view of the stringency which my noble and learned friend on the Woolsack has once again brought to our attention, I must say that I think we are more likely to get something done through local authorities than in any other way.
I have referred to the other problem. that of how to balance protection against enterprise. Molony said that competition was the consumer's best friend, and I think we shall all agree—at least probably everybody in this House will—with that. But inefficiency cannot be cured by legislation; and inefficiency is the great crime against the consumer. What can we do? I suppose that all we can do is to encourage people to make themselves better informed about their real wants and to demand that the people who are selling them things say what those things really are. If you get "A" equalling "B" in this way, you get a satisfactory sale. The Consumer Council does 1301 quite a lot in this respect. But as my noble friend Lord Hanworth, who is a specialist in this particular subject, will deal with it later, I will say no more. Anyone working in this field, it seems to me, must walk a tightrope between too much and too little interference. In trying to promote the interests of the buyer without mortally offending both the seller and the relevant Government Department, one must regard pleasing two out of the three as a bull's-eye not often achieved.
My noble friend Lady Burton of Coventry raised one other question, apart from complaints—the question of co-ordination; and of course I agree with her that a better and stronger lead could and should be given by the Consumer Council. Goodness knows! we are trying to do it. But there is already very close co-ordination in many directions. Of course it should be closer; of course it should be more effective. But the Chairman of the Consumers' Association is one of my oldest friends, and we meet and talk constantly about this question of co-ordination. We had the C.A. people in our office only last week discussing Mr. Arthur Davidson's Bill on unsolicited goods. And I think that, as a result of this discussion, he is going to widen it (at any rate, I hope he is) to cover not only unsolicited goods, which are an obvious evil but one that rarely appears, but also something which is much more difficult: I refer to some of the less attractive examples of "inertia selling" which come about as a result of the activities of book clubs and gramophone clubs, which on the whole do a very good job but sometimes go a little too far. Then we have regular meetings with the weights and measures officials; and we frequently go to and speak at the consumer groups. I think the machinery is available, though I agree that we ought to make better use of it.
My Lords, I have said all I should. It is a difficult task, because one is so apt to go too far on one side or the other. But there is such an enthusiastic movement in this country of consumer groups (we have been through them all once or twice, these various voluntary movements of which my Council is only one) that I believe that, if we all go on trying, we shall eventually make some real progress.
§ 5.4 p.m.
§ VISCOUNT HANWORTH
My Lords, I should like to deal with one aspect of consumer problems, which is providing information about the goods consumers buy. But I, like the noble Lord, Lord Donaldson of Kingsbridge, must declare an interest because I am a full time working member of the Consumer Council, and the head of the labelling branch which is responsible for TELTAG. The views I am going to express this evening are, of course, my own, and I thought rather carefully whether it would be right to speak, but I propose to deal with the subject in a fairly broad way. I gather the noble Baroness, Lady Burton of Coventry, is also interested in hearing something of what we are doing on the TELTAG side.
In England to-day the need to provide consumers with reliable information on the goods they buy is, I think, a very pressing one. The range of goods available has vastly increased and the old yardsticks on which they could be judged do not any longer apply. For example, wool garments can be treated so that their characteristics are quite different from what would normally be expected. Wool garments may have as good a resistance to shrinkage as other types of fibre. Moreover, things are changing so rapidly that there simply is not time to find these things out by trial and error. By the time we have done that, probably a new and improved product will have come on the market.
I think we must also take into account the immense power of modern advertisements. The new Trade Descriptions Act will improve the reliability of the statements made, always provided that there is adequate enforcement. I think we must remember that the weights and measures authorities have a very big job to do. They are doing it very well, but they cannot be everywhere and there is, of course, a danger sometimes that it may be worth while the manufacturer, or whoever it is, just pressing ahead and saying, "Well, one is unlikely to get caught out". So we have got to think of enforcement that is adequate for the purpose. It is interesting to note that in some areas the Trade Descriptions Act has been a positive disincentive to providing even the meagre amount of information which was given before the Act came into 1303 force. Later on I am going to say a word about the use of Section 8, which provides compulsory powers in the Trade Descriptions Act, because if we are going to continue to get the amount of accurate information we need I believe there are areas where enforcement must be considered and must be used.
I think there is also a much longer term aspect to this matter. The success of our capitalist economy relies on consumer choice dictating the type of product firms make, and without an informed consumer it is certain that the feed-back will not operate efficiently. There is certainly a danger that if the consumer has to reply solely on the statements made by the manufacturers, the initiative will rest largely with the manufacturers and their trade associations, and these necessarily tend, in the main, to have a rather conservative approach. This would not only be to the detriment of the consumer, but to our ability to compete in overseas markets. We must sec that new products which are an improvement come on to the market as quickly as possible in order to be able to compete overseas. If the consumers are not informed they probably do not know that such products exist, and therefore we do not move into new fields as quickly as we can and should.
Apart from the information which the manufacturer provides, there are three recognised systems for helping the consumer in making a logical choice. These are: comparative testing; quality marks; and informative labelling. Comparative testing, as your Lordships all know, is represented in England by the Consumers' Association magazine Which? This fulfils a very important and useful role, particularly so for the more highly educated consumer. It cannot, however, directly provide information at the point of sale either to the buyer or to the sales assistant, and in many cases it is the sales assistant on whom the consumers rely in trying to make their choice.
We then have quality marks, and these are intended to show that goods have reached a certain standard of performance, quality or safety. Unfortunately, the vast majority of so-called quality marks are very little more than trade "puffs", or an attempt to promote the sale of a particular product. They have 1304 no public requirements or system of surveillance. The certification trade marks, which have to meet requirements laid down by the Board of Trade, are notable exceptions to this generalisation. They include the kite mark, which certifies compliance with a British Standard; the B.E.A.B. mark for the safety of domestic electrical appliances; and the wool mark, which requires the product to be of pure wool and to meet certain specifications. There are, of course, many more, but I have mentioned three of the ones which are particularly well known.
These marks are of real help to the consumer where there can be a clearly defined basic specification, such as for health or safety, but they provide no guide for the bulk of goods which exceed the minimum requirements or where the consumer's choice depends on sorting out the various performance characteristics of the goods to meet their own particular needs. As an example, a food mixer might be excellent for whisking eggs but simply not man enough for the Victoria sponge cake. There, of course, one is faced with a dilemma when dealing with a quality mark: do you exclude the mixer which is suitable only for whisking eggs, or what do you do? The usual answer is that it would come down on the lower side, and would therefore give no information whatsoever on the properties of the mixer for cake-mixing.
Informative labelling is a fairly wide term, and it is often used to cover care instructions such as may be given on textiles for specifying the recommended washing or cleaning procedures. I prefer to confine it to information which may be given to assist consumers in making a logical choice at the time of purchase. The aim is to give a balanced overall picture of a product with an emphasis on its performance characteristics. I think carpets are probably a particularly good example. There are two major characteristics of importance to the consumer; one being the durability and the other being retention of appearance. By "retention of appearance", I include such things as colour fastness, pile flattening and soiling. If you are a family man with, say, three children and you want a carpet in your living room, and if you cannot go out and buy the most expensive type of carpet, durability must be your first consideration. If, on the other hand, you want it in the spare room, 1305 which is very seldom used, then the durability problem simply does not enter into the question and you are much more concerned with its retention of appearance, the fact that it will not fade. So it is not just a simple matter of giving a quality mark. You have to give more information, perhaps combined with a quality mark, to enable the consumer to make that logical choice.
This type of labelling was started in Sweden some 16 years ago, and it has been taken up in other Scandinavian countries. Schemes have also been recently started in Germany and Holland; and it is being considered in America, too. Our own TELTAG was started just four years ago and is based on the same principles, and I should like to tell your Lordships something about it in a little more detail. Producing a TELTAG is quite a long and complicated process. First of all, we have to find out as much as we can about the product and then produce a tentative label for discussion with consumer interests; because, above all, the TELTAG is designed to be a label for consumers, so our first preoccupation is what consumers want to know and how we can give them the information in an understandable form. I should like to say here that the Consumers' Association, with all their expertise, have been particularly helpful to us. They always attend our meetings when we discuss a label, and they provide any information which they may have on the methods of test, and so on. So this has been a very happy relationship with another of the consumer bodies.
We then discuss the revised label informally with the trade, and, depending on circumstances, either ask the British Standards Institution to arrange for one of their technical committees to produce a standard laying down the test methods we need or, alternatively, hold a meeting of interested parties and then put the test methods in the certification trade mark documents. So in either case they are published within the full meaning of the word. Before any manufacturer can join the scheme and use a TELTAG label the B.S.I., acting as our agents, inspect the quality control procedures at manufacturers' works and arrange for the testing of the product to check that the statements to be made on the label are correct. 1306 The standard of quality control is, broadly speaking, that of a good firm in that industry. We then have continuing visits, which are made roughly on an annual basis, and periodic tests of the product, some of which products we buy through retail outlets.
Although this degree of independent surveillance is no more than has been required for the B.S.I. kite mark for some time, it represents a new conception to many manufacturers who feel that outside influence in their affairs is undesirable and who tend to resent it. But we can usually convince them that in fact this is necessary to preserve the validity of our mark against abuse. We feel, however, that this independent surveillance, and the full publication of all test methods and regulations, are one of the most important parts of the scheme, both from the consumer point of view and in making the scheme of real value in our export markets.
Our own experience has shown that firms often believe that their quality control is excellent when in fact the system has broken down at the lower managerial level. Our largest retailer of carpets, who has well over 150 shops, will shortly be using the TELTAG for all his tufted carpet ranges, and has publicly stated that one of the chief reasons for doing so is that it will no longer be necessary for the firm to make their own tests and checks on the quality of the carpets which are being manufactured for them to sell. It is also interesting to find that the information given on performance, and in particular the colour fastness of carpets, has increased the interest in this important characteristic and has led to improvements which were at one time thought impossible.
Surveillance, however, is only one of the difficulties we have had in getting the scheme accepted by manufacturers, and perhaps it goes without saying that no manufacturer has the consumers' interest so much at heart that he will join the scheme unless it is thought to be a viable commercial proposition. We ourselves have never had any doubt that the scheme had worthwhile commercial advantages—always provided that the manufacturer will use it as a selling aid and not, at this stage, simply sit back and imagine that the label will automatically sell itself. This may of course be so in the 1307 future, when the scheme becomes far more widely known, but it is, I am quite convinced, a very powerful selling aid for those who use it. The scheme does not in fact cost very much. If you cost it on a product basis it usually works out at something less than 1,000th of the retail selling price of the product. So this is something which the manufacturer can absorb quite easily if he feels that the scheme is going to be useful to him.
Some manufacturers also view the scheme as a further interference by the Government and as something which will upset the existing status quo or interfere with the importance of brand image, or, at the best, as a needless complication to an already complicated life. Looking at the situation as it stands to-day, I think I can say that we have succeeded in establishing the TELTAG scheme, although it has taken a good deal longer than we had hoped for when we first started. But the speed at which we can expand it and make a real impact on the consumer depends on the funds that we can get for publicity. As your Lordships have heard, the maximum amount that we could spend last year was £20,000. That does not begin to reach the consumers at all. We have found this money to be very useful in getting the retailers and others to know something about the scheme; but it simply does not touch the problem of getting the scheme moving really quickly.
I believe, for reasons which I have stated earlier, that there are areas where the Government should make use of the compulsory powers given under Section 8 of the Trade Descriptions Act, not only to establish the principle of giving more information to the consumer but because in some cases an order covering a whole product field would be better than a partially-implemented voluntary scheme. Frankly, I am doubtful whether the Board of Trade, which is responsible for implementing such compulsory legislation, has yet organised itself to take such a task. which is a very considerable one when one takes into account the amount of consultation and research that is necessary before using compulsory powers.
We hope that we can press the Board of Trade to grasp this nettle, and, incidentally, to support them in the House 1308 when they nave grasped it and not to ask: "Why did they not do it on something else, something which would have been so much more important? "—because I think we can rest assured that where they do it they will have considered the matter extremely carefully. It is very important that they should get started on this in the right area, which may not necessarily be the one which appears from the outside to be the most important to the consumer.
Before closing I should like a word about consumer education. Many people think, and I agree, that a good deal of consumer dissatisfaction and complaint would disappear if people knew more about the goods and services they buy and if they adopted an altogether more questioning attitude to what is displayed before them. There are two ways to tackle this: to give consumers more and better information at the point of sale (as I think TELTAG will do), which makes it easier for them to find out what they can expect from goods and services; and also to encourage consumers to be more questioning and discriminating.
This means starting with basic education. I am impressed by the way in which consumer education is being taught in school subjects. Pupils are encouraged to make visits to shops, to evaluate the comparative merits of different products, to learn how to manage the money they earn and to master the intricacies of hire-purchase and credit documents. Groups of young people in colleges of further education and in clubs are by no means passive consumers of goods and services. They take a lively interest in their rights as shoppers and want to find out as much as they can about the things that they buy. One of the problems of consumer education is reaching out to people who may not choose to use any part of the formal education system—and the Consumer Council has explored a number of possibilities of reaching consumers with basic education. This includes talks with groups of mothers at post-natal clinics, with youth clubs, with community clubs. The impression that is left by all these encounters is that people do want more information about the goods and services they use but they do not always know how to go about getting it. And 1309 they are emphatic that they certainly do not get it from an overwhelming number of suppliers. I feel that in the future consumer education can be one of the most important ways of overcoming our consumer problems; and from what I know of the other work of the Consumer Council, I can say that we have done a great deal in this field and have done as much as our finances could permit.
§ 5.25 p.m.
§ LORD REDMAYNE
My Lords, I too must congratulate the noble Baroness. I know that the retail trade will be keenly interested in what she had to say, and indeed in this whole debate. They will be grateful to her for her acknowledgment that there are some white sheep among the black—I am also, because I am a director of two large and quite separate retail organisations. In this debate, therefore, I feel something of a lone wolf in white sheep's clothing—which the noble Viscount, Lord Han-worth, will agree that I am entitled to call "double thickness".
No scrupulous retailer takes exception to the principal objects of the Trade Descriptions Act, but since it submits him to supervision of his trading he has a right to ask that that supervision should be intelligently applied; and I doubt if this has always been so. To quote a concrete case, I doubt whether a branch of a reputable multiple chemist should be taken to court because an assistant inadvertently charged a customer (who was an inspector) the full price for a product which was marked" 9d. off retail price". Admittedly, shopkeepers are responsible for the actions of their employees; but there are limits to the possibilities of supervision of individual mistakes.
I would say, for example, that if an inspector makes a test purchase he should act in the same way as any other customer. Any other customer making that purchase would obviously say: "What about the 9d. off?" The answer to that would immediately tell the inspector whether, in fact, the cause of the complaint was an isolated act of carelessness which could be adequately dealt with by a warning to the branch manager or to the company, or whether, on the other hand, it was a wilful act which justified prosecution. Incidentally, the company of which I am talking in this 1310 instance was fined £100 for what I regard as a very trifling offence. The damage is that a fine of that category gives to the public at large a grossly magnified image of the nature of the offence. Indeed, one could wish that the shoplifter was treated with the same severity as the shopkeeper. But that is perhaps hardly relevant to this debate.
My Lords, the second point relating to the particular multiple company to which I am referring is in regard to errors in dispensing. I should be grateful if the noble Baroness who is to reply would give me a specific answer on this point. The dispensing error that I have in mind at this moment was the cause of a recent prosecution based on a shortage of ten pills in a bottle—trifling enough as it sounds, although dispensing errors are very important. There is no doubt of that; they are serious matters. But I put it to the noble Baroness that these are very much better dealt with by complaint to the local National Health executive committee rather than under the Trade Descriptions Act. The National Health executive is much more competent to judge a professional matter; it has full powers to reprimand and to fine, and it can even strike off an offender. So far as I know, there has never been any suggestion that the supervision of dispensing chemists by this means has been inadequate.
One tends to suspect, my Lords, that some inspectors may regard a prosecution as a feather in their cap and be forgetful that, as I have said, to the company concerned it may mean serious damage to good will out of all proportion to the gravity of the offence. Of course, it is desirable to detect and punish unscrupulous traders, but the honest do not relish being treated as dishonest. Therefore I think it fair to ask again—this question has already been put—whether local authorities have received any advice from the Board of Trade as to the policy which local authority inspectors should follow in carrying out their duties under this Act: and, if they have, what were those instructions.
I do not want to be tedious, but there are two or three anomalies that arise under Section 11 which ought again to be put on record. The noble Bareness, Lady Burton of Coventry, referred to them as loopholes in the Act; I would 1311 refer to them as pitfalls for the honest shopkeeper—perhaps a difference in attitude of mind. They are causing a great deal of anxiety to those who have to manage retail businesses, and I would guess that they are just as puzzling to the inspector. Why, one might ask for example, is it apparently forbidden under Section 11 to sell an article marked, "3d. off the recommended price" at less than 3d. off the recommended price? It frequently happens that the retailers regular price is lower than the recommended price and therefore he is caught between two fires. The customer expects him to take 3d. off his regular price, but, as we read it, the Act forbids that, if in fact the offer is made in relation to the recommended price. It is a terrible tangle and I do not expect the noble Lady to reply to these points. As I say, they are for consideration.
Another anomaly is the provision that a product reduced from its normal price must have been on offer at that price for not less than 28 days in the preceding six months. We all know this provision. It has two effects; one is that that offer becomes illegal if it continues longer at the lower price than approximately the six months on which it is based: thereafter it must lapse. Alternatively, of course, under the same provision it is illegal to make a further reduction in the reduced price during the period of six months unless the lower price has itself ruled for 28 days. There are other anomalies. I will not go into them in detail, but honest traders do want guidance about how this Act should be interpreted. In fact, as the noble Baroness said, Section 11 badly needs amending.
There is one other effect of the Act which is worth putting on record. It is that at a time when maintained prices of any sort were being largely abandoned, for the presumed good of the consumer, there has become apparent a strong tendency for manufacturers to return to maintained prices, recommended prices, as being the least uncertain base for a pricing policy. As a result, consumers are having to pay marginally more than the market would necessarily demand. As I say, we want a solution to these difficulties and I was grateful for the generous support of the noble Lord, Lord Donaldson of Kingsbridge, who admitted, in a way in which it has not been 1312 admitted before in this debate, that there are two sides to this question; that the battle is not all on the side of the consumer; that the retailer has his problems too and is doing his best to resolve them in the public interest.
A further undesirable result of the Trade Descriptions Act as a whole is the false impression which it has created under its catch-phrase name of "the Shoppers' charter". It has been accepted by the public that the Act is not only a protection against misrepresentation but provides machinery for complaint, particularly in the office of the local inspector of weights and measures. Those who have any practical knowledge of this aspect of retailing will know that customers' complaints run the whole range, from genuine, through arguable, to frivolous and downright dishonest. The shopkeeper, of course, deals with them on their merits, and with an eye on retaining the continuing goodwill of his customer. But, if I may say so, the customer will frequently get more generous compensation—a matter referred to by the noble Baroness—from the shopkeeper, interested in retaining his goodwill than from any legal decision. I think that the use of the offices of inspectors of weights and measures for this general purpose is a waste of time and money, because two-thirds of these complaints cannot be resolved in that way. By the same token, I am not very happy about proposals for increasing the machinery of Citizens' Advice Bureaux; for the provision of legal aid more easily—certainly not in respect of individual complaints to the Consumers' Council, though I gather that that is not really a runner. Possibly the obtaining of legal advice is a different matter, provided that advice, when given, is informed on particular technical points. I do not think that it is just a matter of law; it is to a great extent a matter of retail practice. If this is to be the way in which those who fight the consumers' case want the scheme to be implemented, I am certain that all these agencies will be swamped by complaints to which the shopkeeper himself could give a sensible answer.
Whether the answer would be acceptable to the customer is another matter altogether, and that is what competition in the High Street is all about. It is too easy for people to think that shopkeeping is simply a matter of buying and selling. 1313 In fact, it concerns itself wholly, through the agency of buying and selling, with establishing and maintaining a permanent relationship with a body of customers. Supervisory legislation is for rogues anti fly-by-nights. The great mass of retailers stay in business by the goodwill of their customers and do not lightly risk damaging that goodwill.
My Lords, apart from my present interest I have been closely concerned with the retail trade all my working life. During forty years I have seen a very significant change in consumer attitudes—and this point was referred to by the noble Lord, Lord Donaldson of Kings-bridge. In the 1930s the consumer who could find the cash—admittedly. if he could, he was lucky—spent it with very considerable caution and I think with great wisdom. On the other hand, a large part of the public which desperately needed consumer goods and had little enough cash to spend fell victim to some pretty unscrupulous trading by some sections of the retail trade.
The 1940s looked after themselves, or at least the problems were different; but by the 1950s the pattern had changed considerably. Those who had some prosperity represented an increasingly wide section of the public, but among them there were many who had little experience of spending cash in the sort of quantities in which they then found it available. They were more free to spend, and frequently they spent badly. Too often they chose what was expensive or eyecatching rather than what was. in their judgment, good value for them. The expensive or eye-catching may well be good value, but it is not on that account a good buy for a particular type of customer.
During the ten years or so after the war some customers made great mistakes. One saw them constantly if one was in the retail trade. From the sum of their regrets there grew a body of opinion which sought to protect consumers from their own unwisdom, and this is really what this debate and the legislation that has preceded it has been all about. I do not quarrel with the legislation in principle, but I am glad that the noble Lord, Lord Donaldson of Kingsbridge, and the noble Viscount. Lord Hanworth, have stressed the need for consumer education. I would ask 1314 that consumer education should not be based on the idea that the retailer is the enemy of all men. Let us have a bit of co-operation. Certainly the two companies, of which I am a member, and which have already been doing this for some years, will continue, if we are required, to do our utmost to provide men who can talk about the merchandise which they sell. I believe that this is a useful service and one that the retail trade as a whole would certainly support.
We must ensure that the legislation. we have is working well, and I would ask that its working be studied with the idea of amending legislation where necessary. It must work well in detail, and in its overall effect on our society. I do not believe that excessive protection of the individual can in the long run do anything but harm. By all means let us pursue the rogue, and protect the unfortunate. But I hope that we shall treat the great majority of citizens as adults capable of conducting their own affairs, and the great majority of shopkeepers as honest men.
§ 5.42 p.m.
§ LORD TAYLOR OF GRYFE
My Lords, I am glad that the House has an opportunity of discussing consumer affairs and, like other speakers this afternoon, I should like to acknowledge my debt to my noble friend Lady Burton of Coventry, not only for her comprehensive review of the problem but also for her continued interest and vigilance in these matters over a long number of years. I am sure that it is some encouragement to her to see her interest shared, and the progress of legislation in this field.
Like others who have spoken this afternoon, I have to declare my interest, which arises from my close association with the Co-operative Movement. A great deal has been said to-day about new organisations which are concerned with consumer protection, such as the Consumers' Association and the Consumer Council, and it may not be inappropriate to make some reference to the Co-operative Movement as a consumer-owned organisation, embracing no fewer than 13 million consumers, with an annual volume of trade of around £1,000 million. We are inclined 1315 to take the Co-operative Movement for granted. It has been in existence for a hundred years, and when we look at its history we appreciate that the original justification for co-operatives was that they were organisations of consumers bound together by a common philosophy to protect the consumer. Indeed, long before legislation for consumer protection was placed on the Statute Book, co-operatives were guaranteeing correct weights and campaigning against the adulteration of foodstuffs.
When so much is being said nowadays by various parties about the importance of participation and involvement of people in community enterprise, I expected that something might have been said about the contribution of co-operatives in this field. Co-operatives are organised and owned by consumers. They are administered by consumers through local committees, and in the field of consumer education, through its educational agencies and women's guilds, the Co-operative Movement has deep roots in the community and plays a considerable role in educating the housewife in quality, design and other aspects of the goods which she buys.
Having dealt with my particular area of interest, I should like to make some general comment, because I feel that in the comprehensive debate we have had, points of detail have been thoroughly pursued. Listening to my noble friend Lord Donaldson of Kingsbridge, I found that I could not share his optimism about the growing significance of the consumer explosion in our society. In fact, when I look at economic policies in Britain in the last decade I seem to detect a deterioration in the position of the consumer in society. We are all familiar, from our television screens, with the fact that when the Government are discussing new economic policies the T.U.C. are summoned to Downing Street, and we see with equal regularity that the Government call in the C.B.I. before any major economic policy is evolved. The T.U.C. represents largely the workers in manufacturing industries, and in turn the C.B.I. represents especially those in manufacturing industries, and in the evolution of economic policy I feel that at times the general consumer interest is neglected. Perhaps that is why some strange legis- 1316 lation, like the selective employment tax, finds its way on to the Statute Book.
I feel that the role of the consumer in Government is a declining one. Noble Lords who are familiar with the work of John Kenneth Galbraith will appreciate that his argument, the myth that the consumer is king, no longer holds. Because of the very nature of modern mass production and the investment that is called for in research and in plant in order to put new products on to the market, the consumer is conditioned to accept those products before they are launched. No manufacturer can now risk putting a product on to the market without a considerable barrage of advertising and brainwashing to ensure that the product is accepted. So the consumer is not the man who wanders down the High Street with a free choice without any previous conditioning. I suggest to my noble friend that his conception of the place of the consumer should not he framed so optimistically as he has expressed it this afternoon.
§ LORD DONALDSON OF KINGS-BRIDGE
My Lords, may I comment? I certainly did not use the word" explosion"; I deny that. Galbraith's remarks apply to the United States of America and are much truer there than they are here, but I absolutely accept that there is a danger. What I do not accept is that from the point of view of the consumer the situation is different. It has always been the case, and it is intensifying, but so are the numbers of consumers and so are the consumer organisations.
§ LORD TAYLOR OF GRYFE
My Lords, with regard to the more specific points raised by my noble friend Lady Burton of Coventry, I think there has been general acknowledgment that the Trade Descriptions Act is a consumer's charter. I hope that some of the difficulties of operating Section 11 will be examined. When that section was being framed, I think that many of the people who were engaged in negotiations with the Board of Trade recognised the difficulty of applying it. While we may change that section in the light of experience, at the same time it contains within it a very important element of consumer protection. 1317 There has been an acceptance, I think, not least from my noble friend Lord Donaldson, the Chairman of the Consumer Council, that the Council has certain weaknesses. Probably the greatest of these is the fact that it has not been able to establish itself, despite its efforts, as a co-ordinating body for all consumer interests. That, as has been pointed out, was the intention of the Molony Committee Report. And the fact that it does not have grass roots is perhaps another weakness in the Consumer Council; and that has been acknowledged by the Chairman in his Report.
I am not sure that this latter difficulty will be overcome by establishing regional offices. I think that the acceptance of greater responsibility by local authorities in this field offers a much more promising possibility. I accept that it is a helpful thing in our community that, almost spontaneously, local consumer groups have been formed; but I think we must be careful about this matter. In my own experience, I have found local consumer groups full of goodwill and enthusiasm, but sometimes less than fair in making judgments and assessments of the performance of local traders. Indeed, I think it can be said that there have been cases of misrepresentation by people who seemed to be more concerned with publicity than an objective judgment. Like the noble Lord, Lord Redmayne. I think we have to see this matter in all its aspects. It is not a battle of the consumers against the traders, of the good against evil. The traders themselves have considerable problems. The distributive trade is a trade which does not pay high wages. It is carrying the full burden of the selective employment tax, and consequently traders can become vulnerable through no fault of their own.
So far as the Consumers' Association is concerned, as has begin mentioned, its main weakness is the fact that it is drawn from the middle-classes and the more intellectual and affluent sections of our community, whereas in our society real consumer protection is required by people who are much less well cared for. Citizens' Advice Bureaux, despite all the goodwill, have been ineffective in their efforts. They have been largely concerned with collecting complaints, transmitting them to the traders and returning to the original complainant the explanations of the shopkeeper.
1318 As I have said, the most helpful development has been the recognition by several local authorities of their responsibility in these matters, by the establishment of local consumer departments. There they can draw on the expert knowledge of Weights and Measures inspectors, public health inspectors and so on. I understand that the Institute of Weights and Measures is now preparing a diploma on consumer affairs so that their inspectors may be much more competent to exercise a wider supervision. But if this job is to be done effectively by local authorities, we must get away from the old idea that the local authority man is some kind of snooper. We must try in our consumer legislation to effect liaison between the community and co-operative societies, chambers of commerce, citizens' advice bureaux, local consumer groups and so on, to see that this consumer protective legislation is discharged with goodwill and understanding.
I think that most speakers in discussing the work of the Consumer Council this afternoon have highlighted the weakness of the lack of co-ordination. But this is true of Government Departments also. There are several Government Departments interested in this area. The Ministry of Agriculture, Fisheries and Food, the Board of Trade, the Home Office, the Department of Health and Social Security and the Ministry of Technology, all have some responsibility in this field. We have to look for co-ordination in this field not only of the bodies mentioned—the Citizens' Advice Bureaux, the Consumer Council and so on—but also of Government Departments.
My noble friend Lady Burton asked what kind of body we wish to create that will effect co-ordination. The Co-operative Movement has led evidence on occasion that it might be appropriate to consider the establishment of a Ministry of Consumer Welfare. I have no intention of creating further bureaucracy or adding to the cost of Government administration. It may be that such a Ministry could be the Government body responsible for relations with the British Standards Institute, the Consumer Council, the Consumers' Association, the Retail Standards Association, the Council of Industrial Design and similar bodies whose work is important to the consumer 1319 But, in addition, it should assume responsibility for weights and measures and food and drugs legislation, and should administer the Trade Descriptions Act in liaison with local authorities. It should represent consumer interest in connection with applications for import duties on foodstuffs and other consumer goods and in connection with the application of indirect taxation, such as purchase tax and selective employment tax.
It should be consulted before Government policy is declared; it should be brought into consultation perhaps by Ministers when they are making their appointments to the various consumer councils in the nationalised industries. It should be prepared in the interests of consumers to make representations to the Monopolies Commission or to the Registrar of Restrictive Trading Agreements on any aspect of restraint of trade which appears to be operating against the public interest, and so on. That would appear to be the comprehensive remit which a Ministry of Consumer Welfare might discharge. And in the last analysis, it may not add to the burden of Government expenditure. It may be a method of rationalising and streamlining the many bodies and activities which are engaged in this field.
There is one other matter to which I should like to refer, and it is the problem of consumer representation in the nationalised industries. I think we all agree that nationalisation in itself does not guarantee that the industry concerned will be sensitive to the needs of consumers. A public monopoly, like a private monopoly, removes from the consumer his basic strength—his right to choose and his ability to take his custom elsewhere if he is not satisfied. I am not arguing against nationalisation. The Nationalisation Acts themselves recognised this difficulty. But, in looking at the operation of the consumer councils within these nationalised industries, I think we should from time to time take stock as to their effectiveness.
Co-operative organisations recently gathered together people who sit on these bodies nationally and tried to make some assessment of their effectiveness. They complained of a lack of independence. These committees are frequently provided with staff and premises by the Boards of the industries concerned, and tend to 1320 be part of the Board rather than an independent element. They have extremely limited powers. There is a lack of public awareness of the existence of these councils within the nationalised industry. A Gallup survey showed that only 12 per cent. of the public had heard of the electricity and gas committees, and only 4 per cent. of the transport consultative committees. So I feel we must examine this important element, too.
I am well aware that this is a very difficult problem, and while we are concerned about consumer interest being expressed adequately in public monopolies, at the same time we must do nothing that inhibits these industries, or frustrates these industries, from operating as first-class business organisations, because they will be judged in the future on that basis. I think we can make some assessment of the effectiveness of these councils without disturbing the commercial viability of these undertakings.
§ 6.1 p.m.
§ LORD AUCKLAND
My Lords, I should like to join those who have congratulated the noble Baroness, Lady Burton, on enabling us to have this debate to-day. Those of us on both sides of the House who have sat through a number of consumer debates on Government Bills and other Motions over the years, will know what a stalwart champion of the consumer she has been and, indeed, at times she has hurled her barbs at this Bench and her own Bench.
The first thing we have to remember is that we are all consumers. There has been a tendency in the past to regard consumers as a very limited section of the public without realising that manufacturers, retailers, sales managers, merchandisers and market researchers are themselves consumers. Therefore, in this Motion we are really looking into the future, and trying to assess how to join together the existing legislation to make it effective. This is certainly not an easy job.
I should like to declare an interest of a non-financial nature, as a Vice-President of the Royal Society for the Prevention of Accidents. I believe safety has a great deal to do with this debate. The Royal Society, I know, will be interested to read what takes place to-day, and my own particular interest here is on the 1968 Medicines Act. I should like to ask the noble 1321 Baroness (I have given her notice of one or two points) a question concerning consumer representation on the Medicines Commission when it is set up. As I understand it, when the Bill went through the Government would not agree to actual representation of the consumer, or any consumer group, on the Commission as a whole, but they have given an undertaking that they would be represented on some of the committees.
I wonder whether the noble Baroness could expand on this matter tonight, or on another occasion, because it is very important at a time when drugs and pharmaceutical products are becoming such emotive words. It is essential that the interests of the pharmaceutical companies and the drug manufacturers, who for the most part are extremely honest, hard-working people, should be protected. The general public as a whole are becoming more safety conscious. I noticed this particularly last week when I went as a guest to the Safety Week in the Borough of Lambeth, where I saw some of the excellent work which is going on in educating people on the matter of safety, and particularly safety in consumer products.
This brings me to the subject of labelling, and one wonders whether sufficient is being done with regard to some of the pharmaceutical capsules and other products to make quite sure that young people particularly, and old people who may be affected in their vision, can tell these products from ordinary confectionery items. This is an important point. If accidents occur, they are highlighted, perhaps in an exaggerated manner, in the Press. Retailers and manufacturers inevitably find themselves, sometimes deservedly but this is often not so, on the butt end of an enormous row.
I should like now to turn to the matter of the consumer in general. We hear a great deal about cut-price items and offers. A good deal has been said in this debate. The Molony Committee made its recommendations, and we have had the Trade Descriptions Act. We still get a certain amount—particularly in cereals—of so-called free gifts, bulbs or some other product at a cut price. One wonders whether the general public really wants them. Has market research, whether carried out by the company or elsewhere, 1322 proved that they are wanted? What people want is the full weight and value of the corn flakes or the washing powder. Do they get it with these free gifts, or cut-price gifts enclosed with the products? I believe there is some doubt in the minds of many people whether this is the case.
There is also the fact that all this goes well beyond the retailer. The retailer depends very much on the know-how, and sometimes the honesty, of the sales force of the company concerned. I declare an interest here as an associate director of a small firm of management consultants. Some of my colleagues run communication courses for sales managers and sales forces of consumer products, although I am not directly concerned with that side of the business.
Much is being done now in the intensive training of sales forces. It is very important to a retailer that the sales representative, or, indeed, the merchandising representative who calls, knows his job. This is particularly true of the small retailer, who may have many customers to serve. He may have accounts to make up, and does not always have time to check on the bona fides of the man's knowledge, or ability of the person concerned. Much is being done now by training companies of the organisations concerned, as a whole, and of training companies generally, to make sure that their sales and marketing forces really know their products and do not merely put over the glossy nature of them; so that they do their utmost to give the beneficial aspects of the products as well, in order that the retailer can pass the information on to the customer.
Finally, I should like to say just one word about certain second-hand products which are still being hawked around the market. This is not primarily a debate on safety, but, as I said earlier, safety and consumer protection and consumers generally go very much hand in hand. There are still fêtes and sales offering too many second-hand electric fires, which are on the market despite the Act which I believe the noble Lord, Lord Amulree, piloted through this House some years ago. One sees them on market stalls and, as I have seen them, at fetes and elsewhere. One has only to have an accident caused by one of these appliances and the bona-fide manufacturers of electric fires 1323 may well find themselves branded as being purveyors of danger. I know that to some this may seem an extreme statement, but I have been told on very good authority that this is the case. My Lords, I hope that, as a result of this debate, the points which have been put forward, together with the various Acts which have resulted from consumer debates in the past, will be another milestone in a really good consumer representation for this country as a whole.
§ 6.12 p.m.
§ LORD DRUMALBYN
My Lords, we are now coming towards the end of what has been an extraordinarily interesting debate, and I should like to echo what has already been said by way of gratitude to the noble Baroness, Lady Burton of Coventry, for not only having introduced the debate but having made such an excellent speech. I am not absolutely certain that I agreed with her final conclusion as to the value of a "summit meeting" on this particular subject, but she certainly set out the considerations in an exemplary manner for the House to consider. We have also had the benefit of a wide range of different points of view. We have heard both the previous and the present Chairman of the Consumer Council and had the benefit of their advice—and long may we have the benefit of their advice! I certainly would not subscribe to any suggestion that they should not be allowed to speak about consumer affairs in this House; we should be very much the poorer if they were debarred from doing so. Then, we have had a spokesman from the Co-operative movement taking part, and a spokesman (if I may put it that way) from the departmental stores, so we really have had a very wide range of assistance in this debate—
§ A NOBLE LORD: Multiple stores.
§ LORD DRUMALBYN
All right, multiple stores; I thought it was "departmental". I do not propose to go into any particular question, because it struck me that this was intended to be a debate about administration in general, developments in administration, rather than on methods of dealing with particular questions such as whether we should have a sixpence and a 50p piece—I wholly agree with my noble friend's views in that connection but I will not pursue them; 1324 whether free gifts are a good thing and, if not, who is to say that they are not a good thing (a question which I should have thought could be left to the market), and whether contracts should contain exclusion clauses. In this connection, I think we have here complete unanimity that the sooner legislation is introduced the better, and that we need not really wait until we have possibly the same kind of additional clause as Section 14 of the Trade Descriptions Act, which was experimental so far as services are concerned. I would doubt whether we should get further than an experimental clause on services in any Bill to amend the Sale of Goods Act.
I do not propose to say anything about "inertia selling" either, the supply of unsolicited goods, except that I think we must be very careful when we go in for legislation of this kind that we do not introduce side effects which would be just as bad as the disease. If the cure is going to be as bad as the disease, it is possibly a good idea not to have it. The point is that, if we were to follow the New York State legislation and allow a person to whom goods which he had not ordered were delivered to annex those goods—to treat them as a gift—I think we should be striking at our ideas of morality; and we should be very careful about doing that. We do not want to encourage people to acquire goods which do not belong to them in that way. I would certainly say in this matter that two blacks do not make a white and, furthermore, if we had this kind of proposal it might very easily do considerable harm to transactions by word of mouth. Everybody would want everything in writing, because otherwise the customer could always say, "I did not ask for this. I am keeping it. Thank you very much." So I think we must consider difficulties of this kind when we are thinking of legislation on such a subject as this.
Having said that, I think that possibly the best way of dealing with it is this. Mr. Bernard Levin has put forward a suggestion that information should be given with all goods as to the rights of the consumer; and this would follow the hire-purchase legislation. This, I think, would in itself probably be beneficial. We will wait and see what the Bill says, but I feel that I ought to make my 1325 position clear on this matter in advance because the simpler the law is made, and the simpler the obligations that are laid upon people, the better for all concerned.
I noted with interest what my noble friend Lord Redmayne said about fining. May I say this, in passing. My experience of the working of the Trade Descriptions Act so far is that on the whole traders are apt to treat a summons under the Act rather as they would treat a summons for causing obstruction in the road, and say to themselves, "Well, that is finished. I've had it. I may as well plead 'guilty', and the least said the soonest mended." I do not believe that this Act will work properly if traders take that view. If they think they are right, they must plead "not guilty", and appeal if necessary. The law is not all that clear—we know that—and there are aspects of it which need to be clarified, and they will not be clarified unless people stand up for themselves and their rights, if they think they are right.
I agree very much with the spirit of this debate in the sense that it seems to me that we are all united in seeing the value of the closest co-operation and coordination all along the line. If one looks back seven years or ten years, one can say that the antagonisms between the consumer and the trader were very much greater then than they are now. A great deal of the credit for this change lies with the various bodies which have been working in the field. But, so long as consumers treat themselves only as consumers and traders treat themselves only as traders, we cannot expect to have a good relationship between the two.
The Consumer Council have done a good job, if I may say so, in bringing parties together. Sometimes I feel they could develop this work even further than they do already. For example, supposing they were to publish in their organ Focus the results of working parties designed to set up codes of practice for trades and to make suggestions for legislation and the like (as they do to some extent), if they were working parties representing all the interests rather then merely internal working parties, it might be valuable. I always read Focus with the greatest of interest and a good deal of enjoyment, but many of the articles are really just reporting jobs that could be 1326 done as well by the Press. If Focus were to concentrate more on the general principle of getting both voluntary organisations and traders together for the benefit of the consumer—and indeed for the benefit of the trader, because the trader depends on the consumers—this might bring still more laurels to the Consumer Council, to the general benefit of us all.
I was tremendously interested in the remarks made by the noble Baroness, Lady Burton. She dealt mainly with four principal matters: the handling of consumer civil claims; the handling of other consumer complaints; the relationships between the various organisations concerned (which I have already tried to touch on), and consumer education and all that goes with it, including the training of shop assistants which I was glad to hear my noble friend Lord Redmayne mention.
I would approach this by saying that there are essentially seven bodies dealing with consumer problems. In the first place, there are laws, almost all of which have been touched on in this debate, such as the Consumer Protection Act and the Medicines Act, designed to protect the consumer against dangers to health and safety which particular goods may involve. Secondly, there are laws designed to protect him from misleading descriptions and claims, such as the Trade Descriptions Act and parts of the Food and Drugs Act. Then there are laws designed to enable him to assert his own rights and obtain redress under the civil law. Then there are bodies and associations concerned with helping the consumer with advice and information or making representations on his behalf. There are those which actually take up cases, including newspapers and magazines, which invite readers to send in their complaints for examination. They have columns, such as the Daily Express "Action Line". There is also consumer education. Finally—I think I am echoing what my noble friend Lord Redmayne has said—there is the individual and collective conscience of traders, coupled with their recognition that they are not merely making a livelihood but giving a service, and coupled, as my noble friend so rightly said—or perhaps it would be better to say "tripled"—with their recognition that they are wholly dependent on the good will of the consumers. 1327 My Lords, as taxpayers we all have a common interest in ensuring that we do not unnecessarily multiply the number of people in agencies looking after our interests as consumers, and probably doing things that we could and should do for ourselves. We also have a common interest as citizens in seeing that we do not strangle our liberty with a lot of unnecessary laws and regulations, and that we are in a position to know exactly what obligations such rules and regulations as do exist lay upon us, and what rights they confer upon us, whether as consumers or traders. Of course, we must have some laws and regulations to stop the rogues. At this point I would suggest that there is a strong case for grouping all enforcement duties for which we look to local authorities under one local authority department, and I would hope that when we get a new Local Government Act this will be a requirement in that Act. I am sure that it would make for better administration once we get a clearer division of frontiers.
My Lords, it is nearly a year since the Trade Descriptions Act came into operation and it is right that we should take stock of the position. As was to be expected, in the light of the way weights and measures inspectors performed their duties under the Weights and Measures Act 1953, for the most part these officers have sought to educate traders in the requirements of the Act, only bringing prosecutions in cases where a trader deliberately sets out to deceive or is negligent in the duty to avoid deception. I would admit to my noble friend that perhaps where they particularly dislike a practice, as they dislike the "threepence off" practice, they may bring prosecutions.
§ LORD REDMAYNE
My Lords, I hope my noble friend will study carefully to-morrow what he has said, which if I were not his friend I would call grossly offensive to the cases which I have put.
§ LORD DRUMALBYN
I am sorry, my Lords. Most certainly I will look at it carefully to-morrow. I hope that I have 1328 not been in any way offensive; I did not mean to be. If my noble friend is talking about what I have just said about the "threepence off" technique—
§ LORD DRUMALBYN
My Lords, I think this is what the weights and measures inspectors have been trying to do—only to bring prosecutions in cases where there was either wilful deception or gross negligence. That is what they have been trying to do as a whole, but I have made an admission to my noble friend that where there are points on which they are particularly keen they may follow these up.
Weights and measures inspectors are rightly regarded as the allies both of consumers and of honest traders, and I know that they attach great value to being regarded in this dual capacity. No doubt there are cases where they have felt it necessary to make a public example to clarify the law for the benefit of the public at large, but I am told that the total number of prosecutions notified to the Board of Trade has now passed the thousand mark. I do not know whether the noble Baroness can confirm that. That may sound a large number, but spread over some 250 weights and measures authorities it represents only an average of four cases per authority per year; so it indicates at any rate forbearance on the part of the weights and measures authorities if there were a larger number of cases that they feel they could have prosecuted.
On the other hand, weights and measures inspectors have received a great many complaints from consumers. I am told that the total may be as many as 20 or 30 times the number of prosecutions notified. In view of the publicity given to the Trade Descriptions Act I think it was inevitable that a great many consumers should bring their complaints to the weights and measures authorities. No doubt many of them thought it was the duty of the local authority to obtain redress for them. I dare say that a large proportion of the complaints revealed no offence under the Trade Descriptions Act, or any other Act, but might nevertheless have appeared to inspectors to have some merit. Then, of course, the inspectors have to decide what to do with complaints 1329 which involve no breach of the criminal law. Ought they in such cases to spend their time, and the ratepayers' money, in seeking redress for the complainants at a time when many weights and measures departments are understaffed? This is a problem they have to face.
As your Lordships will know, some local authorities had been experimenting with consumer advisory and information services even before the Act came into being. Some had separated, partially or completely, their consumer services from their enforcement duties; and in my personal view they were wise to do so. Consumer help and advice services can usefully be attached, for example, to a public relations department of a local authority. I say this for more than one reason. If a trader is approached by a local authority, he has a right to know whether or not the local authority is acting in the exercise of its statutory powers. If the local authority officer is merely using his good offices in a matter where no offence has been committed, he should make this absolutely clear; and I believe that in such cases enforcement officers generally do so. Nevertheless, I feel that it is better if an enforcement officer turns over a complaint involving no offence to a different department, such as a consumer help and advice department. No enforcement authority can be right all the time about the law; nor, for that matter, can the magistrates in courts. This again is a good reason why anyone who considers that the enforcement authority or magistrates' court is wrong about his case should be prepared to take it to a higher court if he is found guilty of an offence in the court of first instance.
This liability to error is also a reason why enforcement authorities should not use their weights and measures status as enforcement authorities to induce anyone to do things that the person has no legal duty to do. I regard this as an important matter of principle. Enforcement authorities are efficient; they are conscientious; they are impartial. But it seems to me wrong in principle that they should act in matters where they have no powers, because it seems to me this can only lead to confusion on the part of the public as to the limit of their duties and as to what the law really is. If a complaint comes from a person who has suffered no loss and there is no offence, the inspector can 1330 report to the Board of Trade, if he thinks that the law should be strengthened, and the Board of Trade can call for reports on particular points from time to time. If a person has had a loss, he or she should be advised to obtain redress in the appropriate way.
If the weights and measures authority is not to help a consumer in this kind of way, who is to do it? A good deal of discussion to-day has ranged over this point. It has to be remembered that it is reckoned to cost something between £2 and £4 or £5 to handle each consumer complaint. If a test were required, it could be very much more than that; and then who is to pay? The noble Lord, Lord Donaldson, said that he did not know the answer to this, and nor do I.
§ LORD DRUMALBYN
I do not think one would have expected a definite decision, but surely part of the purpose of this debate is to examine the possibilities, and I would like to put forward one or two here.
There is one point that is important: whoever is going to settle the dispute should be either a person or an organisation which does not represent either traders or consumers; it must be an impartial person or organisation. I think that is the first point that must be established. So that Citizens' Advice Bureaux and the consumer information departments of local authorities are there to give advice and not to act as referees. The weights and measures authorities are impartial but they are enforcement authorities, as the noble Baroness, Lady Burton, has said. They are not conciliation boards or arbitrators. I would egree with the noble Lord, Lord Donaldson, that separate consumer advisory committees can help, but they are not necessarily the complete answer. I have considerable sympathy with the idea that there should be some form of tribunal or arbitration, perhaps in a small claims court, similar to the one in New York State about which the noble and learned Lord the Lord Chancellor was speaking, or by recourse to an arbiter; and I would suggest that such arbiters could be drawn from a panel of arbiters appointed by the local authority and agreed between the parties.
If I may say so, the noble and learned Lord the Lord Chancellor had a rather 1331 quick sleight of hand at this point, because he pointed out that in New York the arbiters to whom cases are referred act voluntarily, without cost; and he then went on to say that in his experience arbitration was always just as expensive as litigation. Could not we do the same here? Could we not have voluntary arbiters, meeting in the evenings as they do in New York, to whom disputed claims could be submitted? I think the noble Baroness, Lady Burton, suggested that this should be done by trial and error. Why should not we try it in certain areas, to see how it works, and then in due course reach final conclusions?
There is another consideration. It is unreasonable for a consumer to expect to get redress entirely at public expense unless he is without means, and if the legal aid system were extended to this sort of case it would be an ideal solution. I should have thought that the noble and learned Lord the Lord Chancellor was perhaps overestimating the difficulty of extending legal aid to cases of this kind. Given that it is so difficult to provide any other solution, I should have thought we were bound to extend legal aid to cases of this sort. He himself demonstrated the difficulty of finding any other solution, and he said that this really depends on legal aid—that is what his speech amounted to. Surely, if that is so, that is the solution that must be decided upon: legal aid must be made available in these cases, so that those who can afford to get redress will pay for it and those who cannot will get it just the same.
I do not want to detain your Lordships any further on those aspects, but I want to say a word about consumer education, because I regard it as extremely important; indeed, in this debate great stress has been laid upon it. I fully agree with what has been said, that this education should start in the schools. I would suggest to the noble Baroness that, at a time when we are about to have an extension of the school-leaving age, this is just the kind of instruction that could interest children staying on from 15 to 16. The great problem is to give them in the last year things that interest them and that actually affect what they are going to do in later life. I should have thought this was a 1332 very good opportunity to introduce consumer education in the schools; and that means also in the teacher-training colleges. I do not know how far the Consumer Council can assist in this respect. I know that they do a great deal by way of pamphlets and so forth; but if they could be peripatetic and provide this instruction in the teacher-training colleges, I think they would be doing a very great service indeed.
I would add one comment on what seems to me to mark a very great difference between our debate on consumer services this time and last time—and here I speak with an interest. I have not heard the word "advertising" mentioned once in this debate, and as Chairman of the Advertising Standards Authority I am very glad.
Lastly, there is one suggestion that I would make to the noble Baroness who is to reply, and that is that she might find it advisable—or, rather, the President of the Board of Trade might find it desirable—to have an advisory committee. I am sure that an advisory committee of this kind would have to be nominated by the President himself from all kinds of personal advisers. They should certainly not be delegates and should certainly not give their advice in public. Considering that the President of the Board of Trade has these duties of deciding what regulations to make, and considering also that he will be getting reports from the Institute of Weights and Measures Administration and the weights and measures authorities in general on various aspects of their work, and suggesting whether the law ought to be tightened up, it seems to me that a committee of this kind might be very valuable to him. However, I fully realise that that is really a matter for the President, and I would not press him to appoint a committee if he is not going to use it or did not think that it would be valuable.
I mentioned just now the weights and measures authorities. I omitted to say something which I feel I must say here The people who are as well placed as any to give the Board of Trade advice in matters of regulations to be made and so on, are the weights and measures inspectors, and the best way of giving such advice would be through their professional organisation, the Institute of 1333 Weights and Measures Administration. Noble Lords may be surprised to know that the Institute has no paid staff at all, although among other things it is responsible for the training of weights and measures inspectors. The Institute is financed entirely by the voluntary subscriptions of its members, and the subscriptions have been more than doubled in this year.
As this Institute is engaged in work on behalf of the public far more than in promoting the interests of its members—it is not a trade association—surely there is a strong argument in favour of giving an annual grant in aid to the Institute. It is important that the Institute should be able, with one authoritative voice, to speak collectively to the Government, to trade associations and to consumer organisations. It is already speaking to trade associations on travel matters, on the motor trade and so forth. It is also doing good work towards overcoming what, as the noble Baroness knows, I regard as the main difficulty of the Trade Descriptions Act, the fact that there can be almost as many interpretations of the Act as there are enforcement authorities, and there is no real co-ordinating body. The Institute is doing this by acting as a centre of information about cases pending and prosecutions decided, but it is greatly handicapped by lack of resources and by lack of people to deal quickly with problems. For example, not all enforcement officers are even members of the Institute. I understand that office bearers have to pay out of their own pockets a lot of the expenses incurred in the performance of their duties as office bearers. That is not a satisfactory situation, and I am sure that there is a real need to build up the prestige and effectiveness of the Institute as the professional organisation of enforcement officers in the field of fair trading under the law, because that is what this whole debate is about: to get the best possible means of fair trading and of administering the system of fair trading in this country.
§ 6.43 p.m.
§ BARONESS PHILLIPS
My Lords, it is nearly a year since the Trade Descriptions Act came into force and, with her unfailing sense of timing, the noble Baroness, Lady Burton, has enabled us to look at the way in which the Act is working. She introduced the whole sub- 1334 ject in a remarkably clear and logical way which was a delight to us all. I think that the way in which the noble Baroness introduced the debate has set the pattern, so that in fact we have closely followed the subject under discussion and have not strayed into further fields. I will endeavour to answer the points that she has raised. Probably she will not like all my replies, and if they do not follow in strict sequence she will know that I am at any rate attempting to come to them. It is unfortunate, in one sense, that we are a little ahead, as we are so often in this House, of a Press conference to discuss the working of the Trade Descriptions Act. I have been given various statements which I could have made had we had the debate a week later; but as the honourable lady in another place who will be conducting the Press conference is a relative of mine, I feel that it would be a little hard if I stole her thunder to-day.
I should like at once to assure the noble Lord, Lord Mowbray and Stourton, whom I congratulate on his most interesting speech, that, unlike him, I am no maiden in consumer affairs. In fact, using one of the phrases that other noble Lords have used, I might say that I am a grass roots housewife of many years standing, because as many noble Lords will know, this has been one of my interests since long before I came into this House.
The Act came effectively into force eleven months ago, and so we have had an opportunity at looking at the number of cases that have arisen. It might be interesting to noble Lords if I outlined the figures given by the professional body to which such great tribute has rightly been paid by the noble Lord, Lord Drumalbyn, the Institute of Weights and Measures Administration. Several other figures have been bandied about, but I think their figures will be the most useful of all. The number of complaints relates to the nine months from December 1, 1968, to August 31, 1969, so they do not cover precisely the period of operation of the Act, but they are near enough. In that time 25,000 complaints were filed under the Trade Descriptions Act, and, as the noble Lord has just pointed out, about 1,000 prosecutions are being dealt with. I have to put it as generally as that, because various things can happen. 1335 It is important to recognise that the Institute has itself made the point that these figures derive from complaints raised by members of the public and do not reveal the number of checks made by weights and measures officers during their normal and everyday working. I think this is most relevant to the fact that we are talking specifically of the Act and the effect on the consumer.
I would at once agree with those noble Lords who have said that the publicity has undoubtedly aroused interest among consumers, which may result in some complaints which are largely frivolous. But, as all noble Lords who have been concerned in any work of this kind will agree, it is equally true that this will shake down as time goes on. The provision concerning false statements about services, accommodation and facilities has also been invoked, as well as the particular provision which we all expected would come greatly to the fore. The types of cases concerned are such as one might have expected—cars, motor vehicles and accessories coming well to the fore, with the setting back of mileage recorders and so on. But I think noble Lords will agree that the figures that I have just given, both of complaints and of pending prosecutions, leave no doubt that the Act has been vigorously enforced and that its passage was amply justified.
Of course, we must not get the wrong impression. There is no widespread and systematic attempt to deceive the customer. In relation to the total number of retail transactions that take place the number of prosecutions is quite small, and in a number of cases it is fair to say that the offences arose because the shop did not observe the high standard of care which the Act rightly demands in checking the accuracy of descriptions, rather than because of deliberate misrepresentation. I think that the noble Baroness, Lady Burton, would be the first to agree with me that the true success of the Act is to be measured not in a number of prosecutions but by the extent to which it promotes greater standards of care to get right trade descriptions; and there is no doubt about its success in that respect.
The Board of Trade are well aware of the immense amount of trouble that is 1336 being taken by trade associations and by individual companies at all levels to ensure that the requirements of the Act are fully understood and faithfully observed; and I think we must pay tribute, as many noble Lords have done and I should like officially to do, to the enforcement officers, to the weights and measures inspectors who are, as has been rightly said, carrying a heavy burden at this time. A great deal has been said on the fact that some guidance should be given to them. I am happy to say that I have here some guidance which was issued to local weights and measures authorities before the Trade Descriptions Act came into force. Your Lordships will be happy to know that I do not intend at this point of time to read through the whole of these notes. I should like to draw the attention of those of your Lordships who took part in the debate to one or two of the headings. On the question of duplicated offences which was raised during the discussion of the Act—whether a shopkeeper, or a multiple shopkeeper, could be prosecuted a hundred times, as it were, for the same offence—there is a very wise and full instruction to the enforcement officer as to his methods of conduct. These officers are of course requested to complete returns and to send them back to the Board of Trade in order to facilitate preparation of the statistics with which we have been dealing. I think this probably highlights the point which the noble Lord, Lord Drumalbyn, has just made.
I must say that when I spoke to the Institute of Weights and Measures Administration I, like the noble Lord, was amazed to know that their own Association was a voluntary one, considering the tremendous amount of work they did. While I cannot comment on this fact, I take the noble Lord's point that this is for the information, and we hope the consideration, of the President, and I would certainly say that I would endorse all he has said about the fact that a voluntary group of this kind does this remarkable piece of work.
This circular outlines very fully the lines of conduct for the weights and measures authorities. I think your Lordships would agree, however—and this is a point which we have often debated in this House—that too much direction from the central Government may lead to 1337 an apparent snarling up, as it were, of law-making and law-enforcing at local level. I am thinking now as a magistrate. I have so often heard in this House a request for a direction. But, of course, the courts are made up of people who are there to look objectively at the facts presented, and I feel that if the directives were too precise we might introduce a completely new principle into English law.
§ LORD REDMAYNE
My Lords, may I interrupt the noble Baroness? One would imagine that it is not a public document, and one can see objections to making it public. However, would it be possible to lay it in the Library of the House, or something of the sort, so that one might study it? It would be very helpful to those of us interested in the subject to see on what lines the Act is being implemented.
§ BARONESS PHILLIPS
My Lords, I will look into this point. I do not think there would be any difficulty, because the document concerns general lines of conduct. I will consult the Department and see precisely what can be done about this. As I say, I should not think there would be any difficulty about allowing those who are directly interested and concerned in this matter a sight of this document.
The noble Lord, Lord Redmayne, said that he did not want a specific reply this evening, but I can at any rate, speaking generally, give him some replies to the comments he made. He criticised the prosecution of a chemist because an inspector was overcharged on a single purchase. I think it is important to remember that, although local weights and measures authorities may enforce the Act by examination of goods and prices in shops, purchases are often made because complaints have already been made by the public. I call to mind an instance that was given to me at a meeting not long ago. It concerned an incident where a wrong price was shown in a supermarket. The member of the public went back at intervals, and this particular thing was still happening; and only then, did he make a complaint. So one accepts that the innocent may well be caught occasionally—or, rather, where the complaint is genuine. But it is important to recall 1338 that the officer often acts following a complaint made by the public.
The noble Lord, Lord Redmayne, referred to dispensing shortages. The Board of Trade have reminded local weights and measures authorities of the desirability of using the appropriate legislation for dealing with offences. But ultimately it must be left to the discretion of the authority concerned to decide how they deal with any matter that is brought to their attention. That is the point I have tried to make before. The Act places the duty of enforcement on the local weights and measures authorities, and the Board of Trade have no powers to require that they enforce the Act in any particular way. I think I must emphasise this. There would of course be difficulties about suggesting that a warning was appropriate in one case, but that there would have to be a prosecution in another. Much must depend on the circumstances of the particular case; and the local weights and measures authorities are on the spot and in the best place to judge what is likely to be misinterpreted by the local community and be most harmful to them.
I think it was Mr. Roger Diplock who suggested that there was a great deal of flexing of muscles. Weights and measures inspectors are human beings, and there will naturally be some who are perhaps more enthusiastic than others. But, equally, since we have agreed this evening that they are a grossly overworked group in the community, it seems unlikely that they would be seeking out something willy-nilly, and that they would prefer to take the course of warning rather than that of prosecuting. Indeed, I think the figures I have quoted reveal this.
The noble Lord, Lord Mowbray and Stourton, mentioned the recruiting of the weights and measures inspectors. I cannot give him any figures on this point. We have heard, of course, that they have their own courses. I do not know that this matter of numbers is very much under discussion because, as I have said, they are under great stress. I am sorry that I cannot give him any satisfaction at all about retaining the sixpence. I think that probably the noble Lord did not expect it. Nor, of course, can I give him, or the noble Lord, Lord Airedale, any hope about the 50p piece, except to repeat the points made so well by my noble friend the Chief Whip, that a coin 1339 has a much longer life than a note. It may be of some satisfaction to both noble Lords to know that I myself last week actually gave one of these as a tip, thinking that I was giving two shillings—so that may well be "the biter bit". However, there is little doubt that already people are beginning to get used to the new coin: one notices that in the stores they are putting these coins in separate slots. So, while I have no doubt that the noble Lords will probably return to the attack, I cannot this evening say any more on this subject.
The noble Baroness, Lady Burton of Coventry, and the noble Lords, Lord Mowbray and Stourton and Lord Airedale, referred to the Sale of Goods Act, and to the fact that the Law Commission have published this Report. The noble Lord, Lord Airedale, very skilfully suggested what my reply might be, thus putting me in the position that I must see to it that I give another reply. I can only say that the noble Lord, Lord Airedale, will appreciate that one cannot plunge lightly into legislation of this kind because it is hedged around with all kinds of complications, despite the justice of the case which has been argued. But I can equally tell the noble Lord that this matter is—I am not quite sure what is the phrase here; but perhaps I may say in the usual channels. I did ask if 1 could say more but I cannot do so because no date or anything has been arranged. At least he will see that the Law Commission's Report is being acted on without waiting necessarily on the other points—though these are very valid and, of course, the subject of further Reports. I hope that I have not, by saying that, in any way jeopardised my own position; and if I am reshuffled tomorrow the noble Lord, Lord Airedale, will have this on his conscience.
The noble Baroness, Lady Elliot of Harwood, we are always delighted to hear from, and I should like to pay my tribute to her work for the Consumer Council. I remember having the pleasure of speaking on a platform with her at one of these large meetings she mentioned, and I thought she put up a very spirited defence for the Consumer Council. if they want a public relations officer, I think they need seek no further than the noble Baroness herself. I agree with 1340 the noble Baroness that the case for what they are doing is a very strong one. Their proposals, as the noble Baroness will know, are currently under review, and the noble Lord, Lord Donaldson of Kings-bridge, is discussing this. I cannot from the Box this evening make any comment on the situation vis-à-vis more money for any of the proposals that are being put up. It seems that, however we dress up our requests in this House, whether they come in an intellectual guise or whether they come in the guise of defence, they always come back to what the Yorkshire-man calls the "come-from".
I sit here waiting for, "Can we have more money?" Whatever the subject, this is always what I might call the tag line. I would only say to the noble Lord, Lord Donaldson of Kingsbridge, and to the noble Baroness, Lady Elliot of Harwood, that Molony did not see any need for the Council to have regional organisations, because they conceived the Council as a central authority working at a national level; and the Committee reached the conclusion that the C.A.B. was the best agency to provide local advisory services for consumers. I am not saying this in any other way than in the spirit of reminding the noble Baroness and the noble Lord of what Molony said at that particular time.
The noble Viscount, Lord Hanworth, mentioned the question of TELTAG, and gave us a very interesting account of it. I hope he gave my noble friend Lady Burton of Coventry the figures for which she asked, because I do not have them. I do not think he gave a complete breakdown, but at least he gave an outline of how this scheme was working. I think this links very closely with the point which my noble friend Lady Burton put to me about seals of approval. Although the Molony Committee came to the conclusion that seals of approval should be controlled in some way, they mentioned that they found little evidence that consumers had substantial cause for complaint about their use.
I am sure the noble Baroness will agree that the Trade Descriptions Act has gone a long way towards outlawing seals which are misleading. It seems that the voluntary marks—the kite mark, the British Electrical Approvals Board mark and the TELTAG mark—are gaining ground against the type of seals which Molony criticised. 1341 I remember sitting on a number of voluntary bodies trying to determine how to describe something like "showerproof" or "rainproof". So much so that I have never since bought a coat which has been able to compete against the rain, because nobody seemed to be able to define what was showerproof and what was rainproof. These committees went on endlessly, and as one question was solved so another seemed to be turned up. So I would say that the fact that the TELTAG label has gone so far is a great tribute to the work which must have been put into it—and here I speak from some knowledge and background.
The noble Viscount, Lord Hanworth, asked us to grasp the nettle (I think that was his phrase) and to deal with Section 8, the marking order section. I think it is very important to remind the noble Viscount that it was made clear during the passage of this Act—in fact, there were expressions of anxiety, as I recall, from among your Lordships—that the Government never intended to make prolific use of these powers. It is very important to get this on the record. They are essentially reserve powers to be used to secure necessary ends when other possible means are found to be inadequate; and at present this is not the case. In fact, the noble Viscount's own marking scheme seems to be meeting a certain point, so far as information is concerned.
§ VISCOUNT HANWORTH
My Lords, perhaps I might just say that there are certain areas where voluntary means have not proved successful.
§ BARONESS PHILLIPS
Yes, my Lords; and the Board of Trade constantly have this under review. But I think it is important to emphasise that this is a final and rather absolute power which was, of course, questioned during the passage of the Act, so it must be looked at very carefully each time.
My noble friend Lady Burton, and I think my noble friend Lord Taylor of Gryfe, referred to the possible setting up of more co-ordinating machinery, or something which would be essentially different from that which exists at the present moment. To deal first of all with the point made by my noble friend Lady Burton, she referred to the functions of the Federal Trade Commission 1342 in the United States, and she wondered whether in any way an organisation of this character might in fact help the administration of consumer affairs in this country. I think it is rather important to point out that when we look at the functions of the Federal Trade Committee we see that we really cover a large number of them by legislation already on the Statute Book.
§ BARONESS BURTON OF COVENTRY
My Lords, may I interrupt my noble friend? The point was—and I hoped the noble and learned Lord the Lord Chancellor would rise, but he did not—whether it would be possible to include a consumer protection department in the justice department, as in America.
§ BARONESS PHILLIPS
In that case, I am afraid I shall have to rest on the reply of the noble and learned Lord. The point made by my noble friend Lord Taylor of Gryfe dealt with a different issue, though similar in one sense. He thought there was need for bringing in the consultative committees of the nationalised industries, and so on. I would certainly go along with him in suggesting that these very worthy councils should be better known. Anything which seeks to help the consumer should certainly be better known. But so far as a wider co-ordinating department is concerned, I must refer him to the reply of my right honourable friend the Prime Minister when this question was put to him in the other place recently. He said:I think that consumers' interests are best served by the present arrangements, under which the Board of Trade has a general responsibility for consumer protection but the Ministry of Agriculture, Fisheries and Food, with its expert knowledge, has a special responsibility in relation to food".—[OFFICIAL REPORT, Commons, 26/6/69, col. 302.]This is not, of course, a final reply by any means, but it is the reply at this point of time.
The noble Lord, Lord Donaldson of Kingsbridge gave us a very interesting history, I thought, of what led up to a great deal of consumer legislation, but I should like to point out to him and to the noble Lord, Lord Redmayne, and, I believe, to several other noble Lords, that here I feel I must speak up for the Citizens' Advice Bureaux. They appear to have nobody among your Lordships represented on their committees, so their 1343 voice has not really been heard. When not in Government, I had a very close affiliation with them; so to the noble Lord, Lord Redmayne, I would say that the Citizens' Advice Bureaux have a policy, when a complainant comes in, of always referring them first to the shopkeeper before they in fact take the complaint any further. And, of course, they had 85,000 consumer inquiries in 1968–69 compared with 59,000 in 1963; so there is little doubt that they are not wholly concerned with social service matters. I would remind your Lordships that the bureaux were set up during the war, when they certainly would not have been dealing with social services. They were dealing with practical questions and answers which related to points of law. So there is little doubt that they carry out the functions of dealing with consumer inquiries.
The noble Lord, Lord Auckland, made a point about the Medicines Act and the Committee on Advertising and Labelling. At present, the composition of the Committee has not been dealt with. I am sure that my right honourable friend will bear the noble Lord's point in mind when this is looked at, but the composition of this Committee is not immediately under discussion. Of course, we salute the noble Lord, Lord Auckland, for his work for safety; I know of this in another way. I take his point about the danger in connection with second-hand electric fires. There are, of course, various regulations, as he will well know, already on the Statute Book, and the Home Office, which is responsible for this section, is constantly looking at this. This is one subject, I see, which they have marked for further discussion.
My Lords, I hope I have attempted to reply to most of the questions raised. This has been a very interesting debate—I would say a fascinating debate—and each noble Lord who has participated has emphasised the point on which I think we would all agree: that only the educated and the informed shopper can in fact, in the end, get best value for money. I am sorry, I nearly missed Lord Drumalbyn's point about consumer education. The Consumer Council in this field have a very good record, starting, as the noble Lord emphasised, with the schools and building up. I rather took the other points that the noble Lord, 1344 Lord Drumalbyn, made as points which he hopes my noble friend will look at; because I am sure that he would not expect me to make a formal reply. I can only say that I rather liked some of the suggestions he put forward; although I found that at one stage when he was putting the questions I had not the answers, and it seemed to me that neither had he.
The educated and informed shopper is what we want. I have believed for many years that if people know more about products they do not buy less but more. Therefore, the interests of the consumer and the trader are running on parallel lines. Education is important and this is what we are bending our minds to at this moment. I wonder whether your Lordships ever read this little poem which I think is rather intriguing. I cannot remember its source. It says:Why do shops close when its time to go shopping?Why is parking absolute hell?Why are replacements not available instantlyAnd why don't folks know about things that they sell?Why are there dogs in the delicatessen"—not for sale, I hope—And doors only heavyweight boxers can pull.Why are writers of labels such liars?And eye-catching packages only half-full?Why are we either neglected or bullied, refused things from window displays and high shelvesWhy don't they ever stock sizes that fit us"—and this is the point—Why don't we ever stick up for ourselves?The legislation is there for the consumer, the good will is there and I hope that this Act is going to prove that we are concerned to see that the consumer gets true value for money.
§ BARONESS BURTON OF COVENTRY
My Lords, the noble and learned Lord, the Lord Chancellor, said that the Government attached great importance to this subject, as was evidenced by our having two Government speakers to-day. I believe that our debate has justified this; I think it has been an excellent one. We have not had one speech which any of us would call facetious. I know that I am prejudiced in favour of this House, but I think that this House is supreme when it comes to this type of debate. I have the pleasant duty of thanking everybody very much for having taken part in it. I should like 1345 to join the noble Lord, Lord Drumalbyn, in saying how glad I am that my noble friend Lord Donaldson of Kingsbridge refused to be silenced. I did not see the paper to which he referred. We should have missed his contribution; and we are glad that he took part.
I should like to make just one comment on what was said by the noble Lord, Lord Redmayne. It conveyed an unfortunate impression. We could see that he had a pleasant expression when he said it; but you cannot read a pleasant expression into Hansard. The noble Lord said that referring to retailers I conceded that there were some white sheep. What I did say was this. I spoke of the relatively few black sheep who bring discredit upon retailers and industry alike. I say this only because for years I have tried to remove the word "protection" out of this subject and to talk about consumer education. I should hate to be tarred with the wrong brush.
My Lords, I am sorry I misinterpreted the noble Baroness in her remarks. Perhaps I was being facetious.
§ BARONESS BURTON OF COVENTRY
My Lords, we will not accuse the noble Lord of that.
My Lords, we never get the replies we should like from Ministers. What we must try to do is to pursue what the noble Baroness meant by saying that the Law Commission's Report and the dates for implementing it were "in the usual channels". I was glad that she mentioned the good work which is being done by the Citizens' Advice Bureaux. I know her experience there and I feel strongly about this matter. I should like to pay tribute to the noble Baroness, Lady Phillips, for the enormous amount of trouble she took to find out the background, long before the debate arose. I would pay her another tribute which perhaps from her point of view may be dubious. I know how difficult it sometimes is as a Minister, knowing the full background, to give the replies that one would like to give. We appreciate that and we are grateful to her for what she has said. I beg leave to withdraw my Motion for Papers.
§ Motion for Papers, by leave withdrawn.