05016sc.11-17

House of Commons

Session 2004 - 05
Internet Publications
Other Bills before Parliament

S.C.E.
11

House of Commons

Tuesday 25th January 2005

Standing Committee Proceedings

Standing Committee E

Consumer Credit Bill
——————————

[First and second Sittings]
——————————

Mr Gerry Sutcliffe

Agreed to

That—

(1)
during proceedings on the Consumer Credit Bill, in addition to its first

meeting at 9.25 a.m. on Tuesday 25th January, the Standing Committee shall

meet at—

(a)
2.30 p.m. on Tuesday 25th January; and

(b)
9.25 a.m. and 2.30 p.m. on Thursday 27th January, Tuesday 1st

February and Thursday 3rd February;

(2)
the Bill be considered in the following order, namely, Clauses 1 to 55,

Schedule 1, Clauses 56 to 59, Schedule 2, Clauses 60 to 68, Schedule 3,

Clause 69, Schedule 4, Clause 70, new Clauses, new Schedules and

remaining proceedings on the Bill;

(3)
proceedings on the Bill shall (so far as not previously concluded) be brought

to a conclusion at 6.55 p.m. on Thursday 3rd February.

——————————

Clauses 1 and 2 Agreed to.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Withdrawn  9

Clause  3,  page  2,  line  27,  after ‘description’, insert ‘, who shall not be connected

through pecuniary interest to the lender’.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Not called  10

Clause  3,  page  2,  line  30,  at end insert—

S.C.E.Standing Committee Proceedings: 25th January 2005
12

Consumer Credit Bill, continued

‘(d)
must be signed by the debtor in the presence of an independent witness,

who shall not be connected through pecuniary interest to the lender and

shall not be the person who has made the statement referred to in

subsection (1)(b).’.

Clause Agreed to.

——————————

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Not selected  11

Page  3,  line  2,  leave out Clause 4.

Clause Agreed to.

——————————

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Graingerer

Alistair Burt

Not called  12

Clause  5,  page  3,  line  37,  leave out ‘or 16B’.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Not called  13

Clause  5,  page  4,  line  1,  leave out subsection (3).

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Not called  14

Clause  5,  page  4,  line  16,  leave out subsection (7).

Mr Gerry Sutcliffe

Agreed to  1

Clause  5,  page  4,  line  18,  leave out ‘that section’ and insert ‘section 185 of that Act

(agreement with more than one debtor or hirer)’.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Not called  15

Clause  5,  page  4,  line  25,  leave out ‘or 16B’.

S.C.E.Standing Committee Proceedings: 25th January 2005
13

Consumer Credit Bill, continued

Clause, as amended, Agreed to.

——————————

Malcolm Bruce

Dr Jenny Tonge

Withdrawn  29

Clause  6,  page  4,  line  32,  after ‘made’, insert ‘or the mid-point of the loan,

whichever is sooner’.

Malcolm Bruce

Dr Jenny Tonge

Withdrawn  30

Clause  6,  page  4,  line  36,  at end insert—

‘(c)
shall clearly state within the agreement the amount borrowed and the

total interest payable on the loan; and

(d)
shall advise the debtor borrowing on credit cards that for long term

balances other credit products such as loans or overdrafts may be

available; and

(e)
shall be obliged to give free and impartial advice to the debtor as to

alternative products that may reduce the cost of borrowing.’.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Withdrawn  16

Clause  6,  page  4,  line  38,  at end insert ‘but shall include—

(a)
the amount paid by the debtor to the lender to date;

(b)
the amount remaining to be paid by the debtor to the lender; and

(c)
the remaining term of the agreement.’.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Negatived on division  17

Clause  6,  page  5,  line  37,  at end insert—

‘(7A)
In addition to the statement referred to in subsection (1) above the lender shall

also provide the debtor with a statement at the outset of the agreement.

(7B)
Regulations may make provisions about the form and content of the statements

under (7A), but the contents shall include a clear guide as to—

(a)
the redress procedures available to the debtor if any dispute regarding the

agreement shall arise, with particular respect to the Financial Services

Ombudsman and the Financial Services Authority;

(b)
sources of information and advice with regard to the debtor’s rights under

the terms of this Act and the 1974 Act; and

(c)
any charges, other than interest payments, which the lender may

legitimately make.’.

Clause Agreed to.

S.C.E.Standing Committee Proceedings: 25th January 2005
14

Consumer Credit Bill, continued

Clause 7 Agreed to.

——————————

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Withdrawn  18

Clause  8,  page  6,  line  35,  at end insert ‘, but shall include—

(a)
details of the rights of consumers under this Act and the 1974 Act with

regard to defaults; and

(b)
details of redress procedures available to debtors, with particular respect

to the Financial Services Ombudsman and the Financial Services

Authority.’.

Clause Agreed to.

——————————

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Not called  19

Clause  9,  page  8,  line  2,  at end insert ‘, but shall include—

(a)
details of the rights of consumers under this Act and the 1974 Act with

regard to arrears; and

(b)
details of redress procedures available to debtors, with particular respect

to the Financial Services Ombudsman and the Financial Services

Authority.’.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Withdrawn  20

Clause  9,  page  8,  line  6,  leave out ‘four’ and insert ‘six’.

Clause Agreed to.

——————————

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddel-Grainger

Alistair Burt

Not called  21

Clause  10,  page  8,  line  37,  at end insert ‘, but shall include—

S.C.E.Standing Committee Proceedings: 25th January 2005
15

Consumer Credit Bill, continued

(a)
details of the rights of consumers under this Act and the 1974 Act with

regard to arrears;

(b)
details of redress procedures available to debtors, with particular respect

to the Financial Services Ombudsman and the Financial Services

Authority.’.

Clause Agreed to.

Clause 11 Agreed to.

——————————

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Withdrawn  22

Clause  12,  page  10,  line  22,  at end insert—

‘(6A)
The debtor shall not be required to pay a default sum unless the liability to do so

is clearly set out in the statement as required under subsection (7B) of section 6

of this Act.’.

Clause Agreed to.

Clauses 13 to 18 Agreed to.

——————————

Chris Bryant

Withdrawn  8

Clause  19 ,  page  13,  line  13,  at end insert—

‘(bb)
the debtor entered into the credit agreement as a result of the creditor

sending him an unsolicited pre-approved application form;’.

Malcolm Bruce

Dr Jenny Tonge

Negatived on division  31

Clause  19,  page  13,  line  19,  leave out ‘matters relating to the creditor’ and insert

‘whether the creditor lent responsibly’.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Negatived on division  23

Clause  19,  page  13,  line  19,  at end insert—

‘(2A)
In particular, when determining whether an agreement is unfair, the court should

consider—

(a)
whether the terms of the agreement, which the lender is seeking to

enforce, were clearly set out in the pre-agreement statement provided by

the lender to the debtor as set out in subsection (7B) of section 6 of this

Act;

S.C.E.Standing Committee Proceedings: 25th January 2005
16

Consumer Credit Bill, continued

(b)
whether the lender has complied with all other requirements of this Act

and the 1974 Act;

(c)
whether the initial terms of the agreement might be considered to be

significantly unfavourable to the debtor when compared with other

similar agreements, when there are no compensating factors within the

said agreement available to the debtor; and

(d)
whether the running of the agreement might be considered to be

significantly unfair to the debtor when taking into account the relative

financial strength of the parties to the agreement.’.

Clause Agreed to.

Clauses 20 and 21 Agreed to.

——————————

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Withdrawn  24

Clause  22,  page  16,  line  6,  leave out ‘alleges’ and insert ‘demonstrates’.

Clause Agreed to.

Clauses 23 and 24 Agreed to.

——————————

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Withdrawn  25

Clause  25,  page  18,  line  6,  at end insert—

‘(2A)
It shall be the responsibility of individuals, partnerships, companies or

organisations acting as credit information services as defined in section (7B) of

the 1974 Act, or acting as credit reference agencies as defined in subsection (8)

of section 145 of the 1974 Act, to take all reasonable steps to ensure that the

information which they store on any individual, partnership, company or

organisation, and which they impart to a third party, is accurate, up-to-date, and

gives a true reflection of the credit record of the said individual, partnership,

company or organisation.

(2AA)
Failure to take the steps identified in subsection (2A) shall give rise to the

opportunity for the individual, partnership, company or organisation to seek

compensation through the civil courts for the keeping of inaccurate information.’.

Clause Agreed to.

Clauses 26 to 28 Agreed to.

——————————

S.C.E.Standing Committee Proceedings: 25th January 2005
17

Consumer Credit Bill, continued

Mr Gerry Sutcliffe

Agreed to  2

Clause  29,  page  21,  line  39,  leave out ‘has applied to’ and insert ‘would’.

Mr Laurence Robertson

Gregory Barker

Mr Ian Liddell-Grainger

Alistair Burt

Withdrawn  26

Clause  29,  page  22,  line  33,  at end insert—

‘(4)
The Secretary of State may, by order subject to affirmative resolution, vary the

guidance or issue further guidance to the Office of Fair Trading (OFT) with

regard to this section, and the OFT shall then be required to have due regard to

this guidance.’.

Clause, as amended, Agreed to.

[Adjourned till Thursday at 9.25 a.m.