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We move the amendment on the suggestion of the Law Society of Scotland. Its purpose is to ensure that, in Scotland, only a sheriff and not a justice of the peace will be entitled to grant the search warrants provided for in clause 48. I discussed the issues before tabling the amendment and discovered that the Law Society of Scotland takes the view that the powers to grant the warrants under the clause should extend in Scotland only to sheriffs.
A justice of the peace in Scotland, unlike in England and Wales, may not be legally qualified and so may be unfamiliar with the criteria for granting the warrants under clause 48. Limiting the power to sheriffs would also bring the Bill into line with recent legislation passed in this House. For example, sections 289 and 290 of the Proceeds of Crime Act 2002 relate to the approval of a judicial officer for searches under section 289. In Scotland, that power is limited to sheriffs whereas, under section 290(3)(a), in England and Wales the judicial officer is a justice of the peace.
Another example is the Crime (International Co-operation) Act 2003, section 17 of which provides that warrants may be granted by a justice of the peace in respect of England, Wales and Northern Ireland. In contrast, section 18 provides that, in Scotland, warrants may be granted only by a sheriff.
Again, section 156 of the Extradition Act 2003 provides that search and seizure warrants may be granted by a justice of the peace in England and Wales, but section 156(1) makes it clear that a sheriff grants them in Scotland. Finally, section 38 of the Asylum and Immigration (Treatment of Claimants Etc.) Act 2004 provides that, in Scotland, only a sheriff will be involved in granting warrants.
The Law Society of Scotland suggests that clause 48 of the Bill is similar to the four recent Acts to which I have referred, and that the appropriate authority in Scotland for the granting of warrants is the sheriff. Amendment No. 2, therefore, would maintain
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consistency in the law on search and seizure warrants in Scotland, and ensure that the warrants under clause 48 are granted only by officials who are legally qualified.
The hon. Gentleman suggested that the amendment is intended to make the Act consistent with other legislation, such as the Extradition Act 2003, the Proceeds of Crime Act 2002 and the Asylum and Immigration (Treatment of Claimants Etc.) Act 2004. The Bill is concerned with the regulation of the affairs of businesses and consumer protection, and the provision under discussion covers entry into premises to obtain information in relation to fitness to hold a consumer credit licence. It is, therefore, not in the same league as the other legislation to which I and the hon. Gentleman have referred.
The Bill is consistent with the 1974 Act, which at section 162(3) provides that in Scotland justices of the peace and sheriffs may issue warrants to enter premises. The clause is also consistent with section 176 of the Financial Services and Markets Act 2000, section 297B of the Copyright, Designs and Patents Act 1988, section 111 of the Medicines Act 1968, and section 1 of the Breeding of Dogs Act 1990.
I can understand the concern expressed by the hon. Gentleman about warrants in cases where there is a considerable risk of criminal activity, imprisonment or danger to affected persons. However, the Bill does not fall into that category, and for that reason we have made it consistent with the 1974 Act and similar legislation such as the Financial Services and Markets Act 2000.
Furthermore, from a practical perspective, the amendment would place an additional burden on the sheriffs and mean that, in addition to their already considerable responsibilities, the OFT or trading standards officers would always need to obtain warrants from them. The Bill provides the regulator with the flexibility to obtain a warrant from a judicial officer without undue inconvenience.
Mr. Reid: The Minister listed various Acts from several years ago, under which a justice of the peace as well as a sheriff is able to grant search and seizure warrants. I shall take careful note of what he said, and look at the provisions in those Acts. I shall also discuss the matter further with the Law Society of Scotland. We may return to the matter in another place, but I shall consider the Minister's response before taking it any further.
The House has considered the Bill at some length and on several occasions, and I am pleased with the consensus that we share on many of the issues. With the
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Bill, we are creating a modern framework for the regulation of consumer credit in the United Kingdom. We want a market that is fair and that rewards competitiveness, innovation, choice and enterprise, but we also want to stamp out the irresponsible and unfair lending practices that do so much to harm many consumers. I believe that the Bill fulfils those aims.
The Bill is the centrepiece of the most ambitious reform of consumer credit regulation since the early 1970s. The reform process involves not just legislative change, but a cross-Government strategy to tackle the problems of over-indebtedness in our society. Dealing with debt is more than just a consumer credit issue. Among other things, we are looking at why people get into debt problems and how to deal with the causes of those problems. We are funding more face-to-face debt advice for consumers, with £45 million over the next two years from the financial inclusion fund, and we are considering the best ways to tackle the pernicious problem of illegal money lending.
This long-awaited Bill has much support from consumer and industry groups and from hon. Members on both sides of the House. I thank hon. Members for contributing to our debates on the Bill. The involvement of all hon. Members who have explained their experiences has been invaluable in developing the Bill. I am grateful, in particular, to my hon. Friend the Member for North-West Leicestershire (David Taylor) and the hon. Member for Old Bexley and Sidcup (Derek Conway), who chaired the Committee so effectively, and to the hon. Members for Wealden (Charles Hendry) and for North Norfolk (Norman Lamb) and all the other hon. Members who served on the Standing Committee. Hon. Members' support for the Bill is reflected in its swift progress in this Session.
From our constituency postbags, we know of the many problems that people suffer because of debt. The debate on Second Reading gave us the chance to hear about many of those problems and the issues that affect business in developing an effective credit market. The Committee sittings offered us a chance to discuss with hon. Members concerns about specific aspects of the Bill.
In what I hope will be the final debate on the Bill in the House, I should like to concentrate on a number of issues that have been of interest to hon. Members. In Committee, the hon. Member for Wealden asked many pertinent questions about issues of great detail. As he said, I have written to him to answer those questions, and hon. Members can find copies of those answers in the Library. Although I understand where the hon. Gentleman's concerns are coming from, it is important to remember that the Bill will provide a framework for regulation. It will allow Parliament to impose general requirements that can be fleshed out in secondary legislation. So we will consult on that detail and can adapt it to changing circumstances.
Hon. Members will recall that I recently took great care to explain the unfair relationship provisions to the Committee. Those provisions must be considered in the context of the laws that deal with specific unfair practices and terms, as well as the way in which the courts will apply the law, and I will not get involved in that issue again today. We have considered extensive
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arguments from across the sector, and I believe that those provisions constitute the most effective means for consumers to obtain the redress through the courts, if they choose to take that route when resolving their dispute. The approach taken in the Bill is a solution that provides comprehensive and flexible protection for consumers, while allowing the industry to make credit available to all, not most, consumers and to continue to innovate.
Some hon. Members are concerned about the powers of the Office of Fair Trading. We must ask ourselves whether the body that enforces the Consumer Credit Act 1974 should have the power to investigate potential wrong-doing and whether consumers should be able to operate confidently in the market, safe in the knowledge that they are dealing with responsible lenders. The answer to both questions is yes. The Bill will provide a regime that ensures that there is fairness for consumers, that businesses are competitive and that the regulator has the powers that it needs to ensure that is so.
The OFT does not have an unfettered power to act. As a public body, it is has a responsibility to act reasonably and proportionately. In relation to its powers under the 1974 Act, it is subject to certain constraints and to an independent appeals tribunal. The powers that the Bill will give to the OFT are an essential foundation for a modern and effective consumer credit market. They are not a luxury. So if we enable the regulators to penalise misconduct, we must also enable consumers to resolve disputes for themselves. That involve introducing a system that is cheap, fair and easy to use. The alternative dispute resolution scheme in the Bill is all those things. It is informal. There is no need for hearings; a dispute can be dealt with in writing and issues can be cleared up over the phone. It can adapt to changes in the market quickly. Not only will it empower consumers to act with confidence in the market, it will also ensure stable competition across the credit sector.
In Committee, I noted some suggestions that clause 24 would impose a requirement to be licensed on retailers who do no more than hold on to a card at the point of sale when requested to do so by the card issuer. It is certainly not the Government's intention to include that in the definition of debt administration. At that time, I said that if, on reflection, the clause was wrong in that respect we would table an amendment to clarify the position. Having considered the issue carefully, I have concluded that the definition of "debt administration" does not include holding on to a card at the point of sale when requested to do so, thus no amendment is necessary.
Members will be aware of the speed with which the Bill went through Committee, which is an indication of the broad degree of consensus that surrounds it. As it stands, the Bill fulfils everything we set out to do. However, the Government have always listened, and will continue to do so. We have listened to the concerns of Members about the timing of notices of sums in arrears for short-term credit, which we discussed earlier, and have now made an adjustment. In the context of the Bill, I have committed to look further at other issues.
I have restated the Government's commitment to look further at the issue of credit card cheques under secondary legislation, and the Department is working on that. Similarly, I have arranged, with my Front-Bench counterparts, to meet the credit card industry on
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18 July, before the recess, to discuss how industry is addressing, through self-regulation, concerns about unsolicited increases in credit card limits.
The Bill enjoys wide support both in the House and among consumer and industry groups. Some aspects of the Bill give rise to concerns, and I have no doubt that they will be explored again in this debate and as the Bill goes through the other place. However, after more than four years' work, I believe that the Bill represents the foundation of a fair and competitive 21st-century consumer credit market. It enhances consumer rights and redress, while giving business confidence that it is competing in fair markets that are fit for the modern world. It encourages effective competition, driven by demanding and discerning consumers.
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