Evidence submitted
by the Advertising Standards Authority (ASA)
I am writing to you in your capacity as Chairman
of the Constitutional Affairs Select Committee. I was interested
to see that the Committee has recently launched an inquiry into
the "Compensation Culture" including the role of advertising
and regulation.
As you may know, the Advertising Standards Authority
(ASA) is responsible for ensuring that all advertising, wherever
it appears, is legal, decent, honest and truthful. The ASA's legal
backstop for misleading non-broadcast advertising is the Office
of Fair Trading, whilst Ofcom is our co-regulator for TV and radio
advertising.
The Department for Constitutional Affairs (DCA)
raised their concerns about the role of advertising in the compensation
culture with the ASA earlier this year. The ads that appeared
to cause the DCA the most concern were those for personal injury
compensation services. These ads have formed the focus of a market
research project that was commissioned by the DCA (to which the
ASA contributed) with the aim of determining whether personal
injury compensation advertising has any negative effects in terms
of consumer understanding or consumer detriment. We expect to
receive the results of this work in early 2006. In the meantime,
it would be inappropriate for the ASA to comment formally on this
work, which is why I am instead writing to you informally with
an overview of our work.
The ASA became involved in this matter when
the DCA approached us to discover whether the ASA has experienced
unusually high numbers of complaints or difficulties with personal
injury ads. The DCA was of the opinion that personal injury compensation
ads encouraged members of the public to pursue spurious claims
and falsely represented the claims process. The Department was
interested to learn about the ASA's experiences. There was nothing
to suggest any particular problems in the data that we had available
to us (both through our own files and those of the predecessor
broadcast regulators). When personal injury ads first began to
appear in 1995 and 1996 (following the abolition of legal aid
for personal injury) the ASA did investigate a number of complaints
about misleading advertising. However, by the late '90s, public
complaints had fallen to a relatively low level, which is where
they have remained.
During these discussions with the DCA, the ASA
has tried to discover exactly which aspects of the advertising
troubled the Department. We uncovered four main areas of concern:
1. VOLUME
The DCA was concerned about the sheer number
of ads being broadcast and printed. Practically speaking, regulating
the number of ads being published would be highly problematic—and
in fact quite impossible in non-broadcast advertising. Although
such an approach might be more of a practical proposition in broadcast
advertising, it has never before been attempted and would have
to be a matter for Ofcom rather than the ASA. Any attempts to
achieve such a restriction could be deemed to be anti-competitive.
2. DISTASTEFULNESS
The DCA's second concern was that they felt
that many of these ads were in poor taste or "tacky".
As you can no doubt appreciate, the ASA can take action against
harmful or misleading advertising, but the mere fact that an ad
has been produced on a low budget and is perceived to be vulgar
is not an issue on which we can intervene. Serious or widespread
"offence" would have to be proved, and that is hardly
the issue in this genre.
3. INAPPROPRIATE
PLACEMENT OF
ADS
The DCA had concerns that ads were appearing
on public sector property, for example, in hospitals, surgeries,
schools and police stations. The ASA recommended that the Government
simply withdrew the advertising space from these advertisers.
In such cases, the final decision whether or not to carry an ad
lies with the site "owner". We understand that the DCA
has now worked with other Government Departments to recommend
that public sector property does not accept this type of advertising.
4. MISLEADINGNESS
There is already legislation in place to cover
misleading advertising and this legislation is soon to be updated
by the transposition of the Unfair Commercial Practices Directive
into UK law. The ASA is recognised as the "established means"
for implementing the Control of Misleading Advertisements Regulations,
and we hope that this arrangement will continue under the new
regime. The question of whether consumers are misled by this sort
of advertising will be explored in the market research, which
might provide some harder evidence for assessing whether! how
consumers are being misled.
The DCA's general uncertainty about the content
problems with this type of advertising prompted the research project
that I have already mentioned. The findings of the project will
be presented to the Code owning bodies (the Committee of Advertising
Practice and the Broadcast Committee of Advertising Practice)
so that they can judge whether changes to the advertising Codes
would be necessary or appropriate.
It is worth noting that, while we await the
outcome of the market research with much interest, in the past
we have found that where there have generally been poor business
practices within a particular industry, that this can sometimes
be reflected in that industry's advertising. It is too often tempting
to view such problems as an advertising problem rather than addressing
the root cause of the problem. In our experience, tackling the
poor business practice itself will often have the desired effect,
as well as improving the advertising. The DCA is currently pursuing
a wide-ranging work programme aimed at improving the practices
of claims management companies and the legal profession in general;
it would not be surprising if this work also had the effect of
changing advertising, without the need to alter the Codes.
I hope you find the above information useful.
I would be happy to provide more information about the ASA and
our work in this area or to meet with you to discuss the matter
in more depth if you think that would be helpful to your work.
Christopher Graham
Director General
Advertising Standards Authority (ASA)
December 2005
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