§ Mr. WatersonTo ask the President of the Board of Trade if he will make a statement on consumer credit deregulation. [5719]
Mr. John M. TaylorI am pleased to be able to report progress with deregulation in this area. The Government take the view that consumer credit law provides valuable and necessary protection. However, some aspects of the law can be changed to reduce the burden of regulation on business without detriment to the interests of consumers.
Last year we consulted on five proposals. Careful consideration of the replies we received has informed our decisions.
We have decided that we should revoke the existing regulations on quotations. Few consumers appear to ask for written quotations and the compliance cost to business is disproportionate to the benefit.
We shall reduce the burden on holders of standards consumer credit licences by limiting the circumstances in which they have to notify the Director General of Fair Trading of changes among their office holders or controllers.
We shall restore the value of consumer protection by making changes to the monetary amounts and limits in the Consumer Credit Act.
However, in the light of the response to the consultation, we shall not change the early settlement rebate regulations.
We are to undertake a further short consultation on our proposal to deregulate lending and hiring to unincorporated businesses. We wish to ascertain more clearly the deregulatory benefits and any consumer costs which may be expected if the borrower or hirer makes a deregulated credit or hire agreement either "wholly", or "wholly or predominantly" for business purposes.
We expect to put draft legislative proposals before Parliament during the next few months.
Finally, we shall in the next few months bring forward further deregulation proposals in the consumer credit sector.