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Madam Deputy Speaker: Order. I ask hon. Members to confine their remarks to the new clause that is being debated.
Mr. Robertson: I apologise, Madam Deputy Speaker.
I was going to say that the OFT threatened to wreck the industry with a heavy-handed approach and to make the point that there was little that the House could do about it. I am therefore concerned about giving the OFT more powers when we cannot affect its decisions. I shall attempt to explore that issue a little more deeply on a later amendment. However, although I shall certainly not recommend to my hon. Friends that we oppose the new clause, I want to put it on the record that we recognise the fears expressed by industry representatives that the OFT is becoming far too powerful. I regret that.
Michael Fabricant: My hon. Friend has made his point clearly, as did my hon. Friend the Member for Surrey Heath (Mr. Hawkins). Does he agree that the OFT has a valuable role in protecting the consumer and that Conservative Members would certainly not want to see large—or, come to that, small—organisations working together as cartels, monopolies or oligopolies?
Madam Deputy Speaker: Order. Once again, we are going rather wide of the new clause. I ask hon. Members please to confine their remarks to the new clause.
Michael Fabricant: Does my hon. Friend agree that although we agree to the new clause and the Minister's interesting points, we do so not only with concern about the power of the OFT and our inability in the House to control all its actions, but with a view to our need to protect the consumer as well?
Mr. Robertson:
My hon. Friend is right, and the objective of legislation of this kind is balance. That involves being fair to consumers—consumer protection is of paramount importance—but not throwing the baby out with the bath water by being too prescriptive. We shall come to that issue in a few minutes, I suspect, on other amendments. I am concerned about the extra powers being given to the OFT, especially when the House cannot affect what it does. When constituents complain to us about matters that we cannot raise with the people who make the decisions, that is regrettable.
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1.45 pm
Malcolm Bruce (Gordon) (LD): I want to say briefly that I am happy to accept the Government's new clause. Although I have expressed reservations about the OFT, the new clause will give it the power to do the job that it does not do often enough: to adjudicate on whether or not trade is fair. My concern is that the OFT does not do enough to promote fair trade and that it regards itself more as a competition agency.
The promotion of fair trade is a proper role. Indeed, I have tabled other new clauses and amendments that would impose further responsibilities on the OFT. However, in deference to the Conservative spokesman—I share some reservations with the hon. Member for Tewkesbury (Mr. Robertson)—my view is that it is not the accretion of power to the OFT, but the imbalance in the way that the OFT applies its powers and its accountability that are matters for concern. For that reason, the thrust of the new clause is to make the OFT do more of what it should do and perhaps to spend less time on what it should not do.
Mr. Sutcliffe: The hon. Member for Tewkesbury (Mr. Robertson) was consistent during the debates in Committee in his views about the OFT.
Mr. Andrew Love (Edmonton) (Lab/Co-op): And about Cheltenham.
Mr. Sutcliffe: And about the timing of Cheltenham week, as my hon. Friend suggests.
I want to reassure the House that the new clause does not involve a serious giving up of power that will thwart consumer protection in any way. The idea of a class agreement will help the consumer. That is the basis for moving the new clause. For example, about 300 applications have been made for individual exemptions—which can take up to eight weeks, to the detriment of the consumer. There are other examples of class agreements, and the process could be applied to the bicycle-to-work campaign. Notwithstanding—I am sure that this will be a consistent theme this afternoon—the OFT's role, this important step will be beneficial to the consumer. The reason why we did not take it earlier is that we were looking around to ensure that anything that helps the consumer would be included in the Bill. The new clause is entirely sensible.
Clause read a Second time, and added to the Bill.
'(1) The Office of Fair Trading shall publish, at least annually, the range of interest rates and ancillary charges currently on the market for specified products.
(2) The Office of Fair Trading shall, within 14 days of publishing the information provided for under subsection (1)—
(a) publish court rulings and details of cases brought before the ombudsman concerning levels of interest rates and ancillary charges for agreements deemed unfair under section 19, and
(b) present to the Secretary of State a report on the conclusions it has come to and the recommendations it has decided to make as a result of its consideration of these findings.
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(3) Where, on receipt of the report from the Office of Fair Trading, the Secretary of State considers that the cost of credit for any particular product, or within any sector of the consumer credit market, taken together with any charges made for ancillary services usually sold together with regulated agreements, are causing widespread consumer detriment, he may by order introduce regulations requiring the Office of Fair Trading to set out maximum permitted levels of interest and other charges for particular products or in particular sectors of the consumer credit market.
(4) Regulations as provided for under subsection (3) may not be laid unless the Secretary of State has first published a notice of intention to do so, and not less than 52 weeks have elapsed since the publication of such notice.
(5) During the period of the notice, the Office of Fair Trading shall—
(a) consult with industry and consumer bodies concerning the possible effects of the introduction of a maximum permitted level of interest, and
(b) make a report to the Secretary of State concerning the consultation responses and the conclusions it has come to and the recommendations it has decided to make concerning the issues raised by the responses.
(6) Where a creditor charges a rate of interest or makes a charge that is in excess of any permitted maximum imposed under subsection (3), then the agreement will be unlawful and unenforceable against the debtor and the creditor shall be liable for a civil penalty.
(7) Regulations introduced under subsection (3) may provide for maximum levels of interest and other charges to be—
(a) reviewed at such times as the Secretary of State thinks fit, and
(b) revised in line with changes to the Bank of England Base Lending Rate or as considered appropriate and recommended by the Office of Fair Trading following the consultation provided for in subsection (5).'.—[Adam Price.]
Brought up, and read the First time.
Adam Price (East Carmarthen and Dinefwr) (PC): I beg to move, That the clause be read a Second time.
Madam Deputy Speaker: With this it will be convenient to discuss the following: New clause 4—Standard method for the calculation of interest accrued—
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