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ROYAL ASSENT
Mr. Speaker: I have to notify the House, in accordance with the Royal Assent Act 1967, that the Queen has signified her Royal Assent to the following Acts and a Measure:
Criminal Defence Service (Advice and Assistance) Act 2001.
Election Publications Act 2001.
Points of Order
12.32 pm
Mr. Michael Fabricant (Lichfield): On a point of order, Mr. Speaker. Despite Government assurances to the contrary, I have been receiving reports all morning from Gentleshaw in my constituency and from elsewhere that people delivering census forms have been walking in sensitive areas--in farms and along country lanes--and so risking spreading foot and mouth disease still further in my part of Staffordshire. There must be some mechanism by which, if that continues throughout the recess, I can make formal contact with Government Departments to ensure either that Government guidelines are kept to--namely, that the forms are delivered by post--or, as I would prefer, given that the Prime Minister has decided to postpone the county elections for a month because of foot and mouth disease, that the census application forms will also be delayed for at least a month, or until the foot and mouth outbreak is over. What mechanisms are there during the recess, other than a phone call or letter, whereby I can report the transgressions that are spreading foot and mouth disease?
Mr. Speaker: I would say that phone calls are the best mechanism. There is nothing to beat a phone call in these circumstances.
Mr. John Wilkinson (Ruislip-Northwood): On a point of order, Mr. Speaker. As the custodian of our liberties, could you ask a Law Officer of the Crown to come to the House today to make a statement on the implications for British justice of the extraordinary conviction of a freedom-loving Englishman in Sunderland for selling produce in the measures of his birth? It is a matter of grave significance for freedoms in our country.
Mr. Speaker: That is not a point of order.
Mr. Dale Campbell-Savours (Workington): On a point of order, Mr. Speaker. Did you possibly miss a Bill when you read out the list of Bills that have been given Royal Assent? Did you not miss the regulation of PR companies Bill?
BILL PRESENTED
Crystal Palace
Mr. Geraint Davies, supported by Mr. Stephen Twigg and Ms Oona King, presented a Bill to transfer the Crystal Palace and Park to the Greater London Authority; to restrict commercial uses of the said land; and for connected purposes: And the same was read the First time; and ordered to be read a Second time on Friday 11 May, and to be printed [Bill 84].
Regulation of Debt Management and Credit Repair Services
12.34 pm
Mr. David Amess (Southend, West): I beg to move,
- That leave be given to bring in a Bill to amend the Consumer Credit Act 1974 to give the Director General of Fair Trading a duty to establish a Code of Practice for traders who offer consumers the services of debt management and credit repair; and for connected purposes.
If my Bill were to become law, traders would be obliged to comply with a code, and the Director General of Fair Trading would be given powers to enforce compliance with it by use of compliance orders, fines and compensation orders. The Bill would also ensure that, before publishing the code, the director general is required to consult representatives of consumers and those who are likely to be affected by it. The code would be published and widely disseminated.
The Bill would prescribe the issues to be addressed in the code of practice, including the advertising and marketing of personal debt services; the terms on which such services are provided; charges; the standards of services to be provided by the trader; arrangements in debt management services for the protection of client moneys; arrangements for ensuring the competence of the trader's staff; procedures for handling complaints from consumers; and any other such matters as the director general, having consulted, considers necessary and appropriate for the protection of consumers' interests.
I know that the Minister for Competition and Consumer Affairs is interested in the issue because I recently had the good fortune to attend a meeting that he hosted and at which I engaged in conversation with representatives of citizens advice bureaux. I decided to persuade the House of the Bill's merits largely because of those conversations.
The National Association of Citizens Advice Bureaux recently published a report, entitled "Daylight Robbery", that highlights the fact that consumer credit borrowing has increased dramatically in the past 20 years. In the past 21 years, there has been a revolution in the consumer credit industry. As of August 2000, outstanding unsecured consumer credit in the United Kingdom amounted to £122 billion. It is a huge sum, equivalent to £3,425 for every adult between 18 and 65 in the United Kingdom.
Consumers' enthusiasm--I do not criticise them for it--to buy now and pay later has been matched by credit companies' willingness to devise an ever greater range of credit products. In the past two years, citizens advice bureaux across the country have reported a 37 per cent. increase in the number of inquiries on consumer credit debts. In the past 10 years, citizens advice bureaux and other free advice agencies have seen an increase in the number of commercial companies offering services for a fee to those who are in debt. Undoubtedly the number of such companies has mushroomed.
Since deciding to promote this Bill, I have been inundated by letters from people describing their debt problems. However, as I said, although I came into money at the weekend, I am afraid that my £86.50 will not be sufficient to service all their debts. Nevertheless, I should like to share one example with the House. One person, whom I shall call "client A", has one dependent child. The client contacted a debt management company for help with debts of £25,000, and the company told the client that creditors would accept offers of £1 per month. However, when bailiffs began to call at the client's home, the client discovered that no agreement had been reached with creditors.
The client went to the CAB for advice. The CAB adviser discovered that the client's total debt was £51,000. When the CAB spoke to the client's creditors, it found that the debt management company had not made any arrangements with creditors. The creditors told the adviser that they would rather deal with the CAB than with a debt management company. I am delighted to say that, as a result, the CAB has the client's debt under control.
The National Consumer Council contacted me, saying:
- "People are often at their most vulnerable when needing debt management services. To feel confident in using them, they need clear information about the choices available in the market place"--
- "and also to know what to expect from both fee charging and free services."
- "debt management services should be properly regulated".
The company Direct Line has contacted me to say that it
- "is concerned many consumers are using the services of these agencies without being fully aware of the potential consequences and costs. Often, it would be more effective for the consumer, and in their best long-term interests, to deal directly with the lender".
-
Direct Line is concerned about misleading advertising, hidden costs, the impact on credit rating, failure to take the full financial situation into account, and long-term costs.
As we all know, there are many advertisements for such services in the newspapers. They say, for instance, "Debt Problems? Money Worries?", offer "unsecured personal loans", and make such statements as
- "We could arrange you a mortgage fast!"
Many of the advertisements suggest that, for a fee, companies advertising credit repair services can wipe the slate clean for those who have got into money difficulties in the past and had court judgments recorded against them. That is nonsense.
There is a real need for consumers to be protected from the services of debt management and credit repair companies. Those needing such protection are undoubtedly the poorest and most vulnerable members of society. I hope that the House will support the Bill.
Bill ordered to be brought in by Mr. David Amess, Mr. David Atkinson, Mr. Richard Burden, Mr. Simon Burns, Sir Sydney Chapman, Mr. Roger Gale, Mrs. Linda Gilroy, Mr. Mike Hancock, Ms Oona King, Mrs. Marion Roe, Mr. Alan Simpson and Mr. David Wilshire.
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