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Susan Kramer: We very much support the concept behind the Bill. The debates on it have been a fascinating exercise in constructive cross-party exchange. As a result of the Bill, we can say that consumers will be better protected than they are today.
I pay tribute to those who have supported us and helped us to understand aspects of the Bill and to try to find ways to improve it. Which? has been mentioned. I would like to mention the National Association of Estate Agents, the Royal Institution of Chartered Surveyors and a number of others that have made particular efforts to make sure that we are well informed. Their information and proposals have always been constructive.
Today we sound the death knell, in a sense, for Energywatch and Postwatch, but both organisations have played an extraordinary role in supporting and protecting consumers, thanks to the way they have
handled complaints and investigated underlying issues. An excellent example was given by the right hon. Member for Coatbridgehe has given me leave not to attempt to pronounce the rest of his constituency name. [ Interruption. ] Others are more able to pronounce it than I am. The work that those organisations have done to try to expose the issues surrounding energy pricing has earned them the gratitude of a large number of consumers, especially those who are most vulnerable. In many ways, those organisations have set a standard for complaint handling against which the new National Consumer Council and the whole system that has been set up under the Bill will in effect be judged. This is an opportunity for us all to pay tribute to the many individuals who have been so dedicated and have been involved in that process.
I pay tribute to my hon. Friend the Member for Solihull (Lorely Burt), who has supported me on the first piece of legislation that I have attempted to take through the House and who has brought so much wisdom and expertise to the issue. From the Lords, I would like to mention Baroness Miller of Chilthorne Domer andperhaps this is slightly unusualLord Caithness, who sits on the Conservative Benches, but who has been quite an ally in working on the estate agent language, even if he was not necessarily supported by his own party. We value his contribution.
I appreciated the positive and constructive approach taken by the right hon. Member for Makerfield (Mr. McCartney). It was a pleasure to be able to raise an issue and get a straight answer and to feel that the issues that we raised were understood and taken seriously. The atmosphere that he created and the way in which he took the Bill forward have allowed this to be a constructive process and I greatly appreciate that.
The Government gave way on a number of issues and made a number of improvements in the course of our debates. I will touch on a few of them. In the end, they strengthened the language on sustainable development as a principle of which the new council must take note in exercising its functions. We appreciate that, even though we wish the Government had gone further, given the importance of establishing that in this era. There were many occasions when instructions to the NCC were couched in the language of may rather than must. We appreciate that there was at least one occasion when the shift from may was towards must. I am talking about the measure to require the regulator to prescribe standards for complaint handling. There was clearly a switch in the presumption of what the activity and focus of the NCC should be and we appreciated that.
We and others, including the Conservatives, were particularly concerned that the penalties that were initially to be levied on an estate agent who refused to join a redress scheme were so paltry as to be almost pitiful and ineffective. The penalty was set initially at £500. The Government moved that to £1,000, which is an improvement. The Conservatives called for £3,000. We wished to have scope for a penalty as high as £10,000 to be levied, particularly for multiple offenders who whenever they are challenged simply keep refusing to do as they are supposed to do and join a redress
scheme. At least there was some movement in the right direction. As the Minister will be aware, the context is that the typical fee for an estate agent from the sale of a property is £3,000. We think that the penalty should at least bear some relation to the earnings from carrying out a transaction not covered by the redress scheme.
Mr. Clifton-Brown: I am sorry to interrupt the hon. Ladys constructive contribution, but does she agree that, as the average sale fee is about £3,000, a maximum penalty set at that amount will be wholly inadequate because it will not deter an estate agent from conducting shoddy business? The penalty should have been several times that amount.
Susan Kramer: I can only agree with the hon. Gentleman. That was our position, but his Front-Bench colleagues stuck at £3,000. There was scope for more agreement on that point. If we had had free votes on several issues, we would have seen a stronger outcome in several clauses.
I have remaining worries as we conclude our proceedings on the Bill. I fully appreciate that the Government mean well, but there has been much discussion about how to handle complaints made by vulnerable consumers and how to ensure that they are able to get adequate compensation and a satisfactory resolution of their problems. The right hon. Member for Makerfield made it clear that he wanted the definition of a vulnerable consumer to be flexible and wide. He gave the example of a widow who might be grieving and thus unable to cope with resolving a problem with an energy company, the Royal Mail or a company covered by the Bill. His example was good, but when we pressed the Government on the way vulnerable consumers would be identifiedwhen we moved into the arena of implementationit became apparent that almost no thought had been given to the matter. The Government might have put themselves into a box from which they will be unable to deliver.
The NCC will receive information on consumers via the consumer voiceover the telephone. If someone calls with a problem regarding an energy bill, it will be likely that the energy companys records will show whether that person is in receipt of benefits, or on a special tariff that might indicate vulnerability. However, many people will not be on benefits or a special tariff, yet will be vulnerable. In addition, the process will certainly not cover the kind of example cited by the right hon. Member for Makerfield. There will be no special tariff for a grieving widow who is in an especially difficult period of her life. If someone calls the NCC with a problem about the postal service, there will be no existing track record to reveal whether that person is vulnerable.
When I raised such points before, I was told that questions would be asked during the telephone conversation to expose whether the individual was vulnerable. Do we really think that someone will say on the telephone, Excuse me, but do you have a low IQ or are you vulnerable?, Have you recently been diagnosed with depression by a doctor?, Is your schizophrenia particularly active at the moment? or, Have you lost someone in the family so that you are unable to cope with complex paperwork?? It will be almost impossible to elicit the information necessary
over the telephone. I have asked many times what mechanisms will be used to try to identify vulnerable consumers, but I am still waiting for an answer. I hope that the Minister will take that point on board.
We are very concerned about the timing of the abolition of Postwatch. The Minister will be aware that 2,500 post offices will be closed over the next 18 months. Postwatch will play an essential part in enabling residents throughout the country to be consulted so that they can raise points to influence whether a closure goes through. Postwatch has a regional structure, whereas the new NCC does not. I should be grateful if the Minister confirmed the verbal assurances we have been given that Postwatch will be left largely intact until the closure process is completed. Is the Minister aware that members of Postwatch, whose role is so critical, will inevitably be distracted by whether they are about to receive a redundancy notice. Morale will be undermined, and in this critical period it will be hard to achieve the focus necessary to protect consumers and ensure that their voices are heard in the closure of their local post offices, which will have broad consequences for them and their communities.
We want stronger assurances from the Minister that small businesses will be recognised. The NCC can pay attention to small businesses, but nothing requires it to do so. Many small businesses fear that, over time, they will be lost in the distractions of the many other activities in which the NCC will be involved.
We have today debated residential lettings, direct sales and off-plan sales. I join the hon. Member for Cotswold (Mr. Clifton-Brown) in regretting the fact that the Bill does not address the issues far more powerfully. We are glad that a review is under way. It is focusing on lettings rather than direct or off-plan sales, whereas we believe it could have dealt with the whole problem. All that the review offers at the moment is delay, with no assurance that action will follow.
A great opportunity has been missed to require training and qualifications for estate agents. I cannot understand why our proposals have been ignored. I have not heard a coherent argument against such a basic framework for individuals who affect the most important spending decision families make. How can we enact a Bill on estate agents without at least requiring them
I shall close by asking the Minister to ensure that the Bills implementation is closely monitored. The Bill sets up a sequence of redress schemes, which, as the hon. Member for the Cotswold eloquently pointed out, are designed to deal with the problem after it has arisen. Consumers are unlikely to pursue a complaint to redress unless the process is easy, positive and offers encouragement. The Minister will have seen the energy supply ombudsmans forms, which are not easy to complete with the detail necessary to pursue a complaint. We suspect that most redress schemes will refuse to provide a deadlock letter enabling consumers to pursue their complaint for at
least three monthsa long and delayed process. Ultimately, it is easier for people to drop out of the system.
Ofgem is reviewing the work of the energy supply ombudsman, but a minimal number of complaints survive to the point of redress. We know that Energywatch is about to disappear, but, as the Minister will know, in the past six months it handled about 32,000 complaints; in the same period, the energy supply ombudsman handled 321. Scaling up now to deal with a greater number of complaints means that the process will have to be closely monitored. Strangely enough, even though Energywatch has no power to deliver compensation, the average compensation achieved by it was £125 per case. The ombudsman, who has all the power, delivered only £80, on average.
Mr. Timms: With the leave of the House, I welcome the brief debate that we have had. I am grateful to my right hon. Friend the Member for Coatbridge, Chryston and Bellshill (Mr. Clarke) for his generous remarks, his contribution to the debates in the Public Bill Committee and this afternoon, and the welcome that he expressed for provisions in the Bill. He is right to pay tribute, as did the hon. Member for Richmond Park (Susan Kramer)
Mr. Clarke: I am extremely grateful for my right hon. Friends kind remarks. In response to the hon. Member for Cotswold (Mr. Clifton-Brown) who led for the Opposition, may I say that if there is a discussion about the location of offices, new offices, especially pursuing policies that we welcome, will be very welcome in Coatbridge, Chryston and Bellshill.
Mr. Timms: I am grateful to my right hon. Friend for that intervention. He was rather unfairly chided by the hon. Member for Cotswold (Mr. Clifton-Brown). I saidrather quickly, perhaps, but I did say itthat there would be an office in Glasgow, as well as in the other locations that were mentioned.
My right hon. Friend was right to pay tribute to the work of Energywatch and to remind the House again of the importance of serving vulnerable consumers well. The hon. Member for Richmond Park also rightly drew attention to the importance of the work of Postwatch. I agree with her about the importance of those arrangements during the current closure programme. I was the Minister with responsibility for post offices during the urban reinvention programme so I know very well how important the work of Postwatch has been in that context. I can give the hon. Lady and the House the reassurance that those arrangements will continue until the end of the programme. We certainly will maintain the expertise in the energy and postal sectors that has been so valuable to us and to the country.
I welcome the constructive character of the debate, reflected in the remarks of the hon. Member for Cotswold just now. I am grateful to him for his
welcome for the appointment of the chair of the new National Consumer Council. We have explored some disagreements this afternoon, and some of them were set out again in his speech and that of the hon. Lady. I am happy to join both hon. Members in their tributes to their hon. Friends in this place and the other place for the contributions to the debate.
Mr. Clifton-Brown: Towards the end of her speech, the hon. Member for Richmond Park raised an important point. We all know from our constituency work that it is difficult to succeed with the ombudsman. She quoted figures from the compensation attained by Energywatch. It would be a tragedy if the Bill led to a weakening of consumer protection, if the ombudsman redress schemes did not work properly. Will the Minister continuously monitor that?
Mr. Timms: I am happy to give both hon. Members the assurance that we will do so, and to reaffirm that the new council will continue to carry out the central functions currently undertaken by the sectoral bodies. We do not want to lose any of the success that has been achieved.
In response to the specific point about publication of reports, it will be at the discretion of the Secretary of State whether to publish reports that he or she has commissioned from the new council. That allows for the preservation of confidentiality, if need be, but the council is free to publish its own reports.
I can confirm that we will monitor implementation. On the point about the level of the penalty for estate agents, we envisage the cap set in the Bill. I remind the House that it will be possible to consider the fitness of an estate agent to continue to practise, and a prohibition order may be made against such an agent, banning them from doing estate agency work. The sanctions are potentially much more severe than simply the level of the penalty.
Mr. Andy Slaughter (Ealing, Acton and Shepherds Bush) (Lab): I wish to present three petitions with a common theme, namely opposition to the forced sale of a number of buildings provided for the use of community and voluntary groups in the London borough of Hammersmith and Fulham. The petitioners in each case protest the decision of the Conservative-controlled council to sell those long-standing and irreplaceable resources for local communities in my constituency, particularly because the decisions were taken in secret without the users and tenants of the buildings being consulted or informed of the sales and without any thought being given to the future of the groups to be evicted.
First, I present a petition of 281 residents of the Wormholt estate in Shepherds Bush concerning the disposal and proposed demolition of the former Wormholt librarya building of merit on the councils own classificationwhich is operated by the Wormholt tenants and residents association, chaired by Rene Taylor, to provide a range of services primarily for elderly residents of the estate.
The Petitioners therefore request that the House of Commons urge the Secretary of State for Communities to use her powers to reverse the decision of Hammersmith and Fulham Council to close and dispose of the former Wormholt Library, now Wormholt Tenants and Residents Community Centre, Hemlock Road.
Secondly, I present the petition of 287 residents of College park, an isolated area in the north-east of my constituency, concerning the disposal of the College park community centre, which has been a public building for over a century, is operated by the College park residents association, chaired by Maureen Clark, and runs a weekly youth club, pensioners club and the Happy Bunnies mother and toddler club, among other community events.
The Petitioners therefore request that the House of Commons urge the Secretary of State for Communities to use her powers to reverse the decision to close College Park Community Centre.
Thirdly, I present the petition of 628 users of the Hut Association, based at 59 Godolphin road in Shepherds Bush. The Hut Association, run by Jacqueline Boyce, is an umbrella group providing services to families, many of whom are from black and minority ethnic backgrounds, particularly the much-loved parents and toddlers group.
The Petitioners therefore request that the House of Commons urge the Secretary of State for Communities to use her powers to reverse the decision of Hammersmith and Fulham Council not to renew the lease of 59 Godolphin Road.
And the Petitioners remain, etc.
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