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12 May 2009 : Column 183WH—continued
The hon. Gentleman also raised the question whether the UK Border Agency staff who deal with visa processing are sufficiently aware of business trends and concerns. I would say that that is so. Training is available for all staff on all aspects of our visa process. Business visitors from India amount to 27 per cent. of the total and the UK Border Agency in India is meeting all its targets at the moment.
As a number of hon. Members mentioned, globally, we are second only to the United States in terms of overseas students, a significant proportion of whom are Indian. That demonstrates the progress that we are making. However, I acknowledge that, as my hon. Friend the Member for Eccles (Ian Stewart) mentioned, there has to be a balance between welcoming genuine visitors to this country and continuing to fight and deter illegal immigration. We have to get that balance right.
My hon. Friend spoke eloquently, revealing his personal commitment to education and training and to the relevance of charitable support—or “giving back”, as he described it—to India. That point needs underlining. Even with the opportunities available and the progress that is being made in India, still a third of all the world’s poor people live there, which is why it is the biggest recipient of funds from the Department for International Development.
The hon. Member for Cotswold raised an important issue about a woman he spoke to at the airport before going out to India. He is right. We have to underline the fact that there is a crucial role for parliamentarians in having international awareness and international access. When I travel abroad as a Foreign Office Minister, I am struck by how such activity is built into the mainstream for parliamentarians in other countries. It is about pursuing the national interest and contacts. We ignore such activity at our peril. I also take on board the hon. Gentleman’s comments about the support that he received from DFID.
The hon. Gentleman made some important points, including about the fact that as India moves up the quality and value-added chain, we need to recognise the fact that, to be able to continue to compete, we need to be smarter and need increased focus on education, training, innovation and research. He also criticised the expertise of UKTI staff, but that was unjust. We have appointed specialists in financial services and aerospace in India, and all senior staff there attend a rolling programme of business development visits to the UK to develop their expertise in commerce.
My right hon. Friend the Member for Makerfield (Mr. McCartney) made a brief contribution, but demonstrated his real knowledge and experience as a former trade Minister, and his commitment to our relationship with India.
I conclude by echoing the comments made by the hon. Member for East Dunbartonshire (Jo Swinson), who leads for the Liberal Democrats. Our relationship with India is historic and well founded, but within any good relationship we have to keep working at it and prioritising it. The Government are absolutely committed to doing that.
Consumer Rights
Jim Sheridan (in the Chair): The Minister who will respond to this debate has been caught up in traffic and will be approximately 15 minutes late, but arrangements have been made for a Whip to take notes.
11 am
Mark Lazarowicz (Edinburgh, North and Leith) (Lab/Co-op): I am grateful, Mr. Sheridan, for this opportunity to discuss consumer rights. I shall highlight three constituency cases, in each of which an individual or group has been treated badly as a consumer, and then suggest how each problem might be dealt with. They are very different, and there is no common theme, but this is too good an opportunity for me not to raise issues that have caused me and those constituents great concern. Although there is no common theme, I shall conclude by making some general comments about and suggestions for improving consumer protection.
The first issue that I want to cover is the problems frequently faced by people who buy newly built houses from a developer. I raised the issue first in a debate in April 2002, less than a year after I became an MP, and again just over a year ago in February 2008. The problems may be numerous and include lengthy failure, sometimes over years, in getting snagging work completed; dates of entry being delayed time and again; serious defects, such as flooding, not being dealt with; problems with property management companies, and so on. I will not go into all of them in full detail this morning as I have covered them before.
The particular problems that I want to raise this morning were highlighted for me in the case of the Corinthian Quay development at Granton harbour in my constituency, to which I referred at length during my debate in February 2008. There were water supply problems, sewage coming through floors, and external finishes and areas not completed. I will not go into all the problems, except to say that some of them were first reported by residents in early 2005 but have still not been dealt with.
After I highlighted the specific case of Corinthian Quay in my previous debate, there seemed to be some movement. Two senior directors of the development company came to my office and promised action. For a while, things seemed to improve, but that did not last long and residents told me that the situation deteriorated again. Earlier this year, on 20 February, there was a dramatic development. My constituents discovered that the company from which they thought they had bought their houses and would receive after-sales service was not Elphinstone, but its wholly-owned subsidiary, Holyrood Services Ltd, even though all communication with residents had been from a company going by the name of Elphinstone, and its name was on all the sales and marketing boards around the site. The original seller’s brochure made no reference to Holyrood Services Ltd, but referred only to Elphinstone, saying that over 10 years it had built up an enviable reputation for its ability consistently to initiate and manage high-quality residential projects. All correspondence seemed to come from Elphinstone, as did the packs given to would-be buyers. Indeed, my correspondence was with Elphinstone and not the mysterious Holyrood Services Ltd. However, it
turned out that the eventual contract between the purchasers and the building company was with Holyrood Services Ltd, not Elphinstone, with which they thought they had been dealing.
On 20 February, matters moved on dramatically, and the residents discovered that Holyrood Services Ltd had gone into administration, while Elphinstone had escaped scot-free from any liability, reducing the chance of a satisfactory outcome for the residents. The National House-Building Council became involved and, to be fair, seems to be actively dealing with the problems, but the residents are not certain whether all the outstanding issues will be dealt with because, for example, they complained not to Holyrood Services Ltd, as they should have done formally under the terms of the NHBC guarantee, but to Elphinstone, the parent company, which seems to have walked away from the problems.
That experience highlights three issues. First, there are clear questions about the way in which Elphinstone seems to have been able to escape its responsibilities using a front company, Holyrood Services Ltd. That happens in areas other than building, but I would like a request to be conveyed to the Minister that his Department urgently investigate the circumstances in which builders—in this case, Elphinstone—are apparently able to evade their responsibilities by using a subsidiary. Will the Minister investigate whether that arrangement is legal, and whether his Department can take any action in this case?
Mr. Russell Brown (Dumfries and Galloway) (Lab): I congratulate my hon. Friend on securing this debate. Will he clarify whether Holyrood Services Ltd is a construction company, or a factoring company?
Mark Lazarowicz: I understand that Holyrood Services Ltd is a wholly-owned subsidiary of Elphinstone, the builders, and not a separate property management or factoring company. It seems to be Elphinstone in another guise, but the eventual contract and deed of conditions was with Holyrood Services Ltd, although the preceding material had come from, and many of the subsequent dealings had been with, Elphinstone.
The second issue is wider, and relates not just to the Corinthian Quay development, but to the long-running issue of how purchasers may assert effective rights against builders who do not fulfil their side of a bargain. Owners may in some circumstances have the right to cancel a purchase if defects have arisen, but that is often not an effective remedy if people have sold their existing house and moved job, and would have to get involved in lengthy litigation to try to cancel the contract.
There have been five such developments in my constituency. The one at Corinthian Quay is the worst, but there are others. One problem is that owners may be able to pursue good legal avenues, but may be fearful of entering what may be very expensive proceedings against a large and powerful opponent. My constituents have found that no independent body can provide even initial free advice, and there is clearly a gap in the representation available to consumers. I will return to that, but I hope that the Minster will address the matter today, or write to me in due course.
The third matter concerns NHBC cover. In the particular case in my constituency it now seems to be doing a good job in actively trying to sort out the problems that it has
inherited. However, through no fault of its own, but because of arrangements under which it operates as a backstop for problems with developments, it could become actively involved only at a fairly late stage in the process because residents must first go through a number of other steps. Is there a way of encouraging the NHBC—I understand that it is an industry body—to have a more proactive role in such cases, perhaps with a mediation or ombudsman role at an early stage, to try to persuade developers to deal with problems such as those that my constituents have suffered for far too long?
The second issue is very different, but also involves consumers thinking that they have bought something from one company, only to discover that they have bought it from another, connected company, as a result of which they lose protection. The issue concerns a holiday in Mallorca booked by one of my constituents and his elderly parents. I do not have time to go into the details of what was wrong with the holiday. Basically, it was the holiday from hell, and it was made worse because the facilities were entirely unsuitable for a person with a disability, which one of the parents is, even though my constituents had made it clear when booking the holiday that they needed an appropriate hotel.
As I said, my constituents had many problems and the upshot was that they wanted to claim compensation from the company with which they had booked the holiday—First Choice. At least they thought that they had booked the holiday with First Choice; after all, they bought it from a shop calling itself a First Choice hypermarket. Their correspondence, when they complained, was with First Choice. However, when they started to complain, it turned out that the contract was apparently not with First Choice, but with a subsidiary company—First 4 Hotels. Although First Choice is bonded with the Association of British Travel Agents, apparently First 4 Hotels is not, so when my constituent complained to ABTA, it said that it could not do anything about the problem as First 4 Hotels was not an ABTA company.
That appears to me to be a complete abdication of responsibility by ABTA. It seems clear that the company arrangements in this case have the effect—whether by design or not, I cannot say—of allowing First Choice to wash its hands of complaints made by customers by saying that the arrangements are with a different company, even when the customers believed that they were booking with an ABTA-bonded company. I believe that ABTA should investigate this case and withdraw its endorsement from any travel company that appears to make use of subsidiaries in a misleading way, as certainly seems to have happened with First Choice in this case. If ABTA is not prepared to investigate or take action, I urge the Minister to do so.
When the Minister wrote to me on the issue a few weeks ago, when I first raised the problem, he invited my constituents to raise their complaints with ABTA, but as I have pointed out, they have already tried to do so, only to be met with the response that ABTA cannot get involved because they did not book their holiday with an ABTA company. The whole point is that the holiday was in effect with an ABTA company. In my view, ABTA should not be able to get out of its responsibilities as a trade body in that way.
Mr. Geoffrey Clifton-Brown (Cotswold) (Con): I am sure that the hon. Gentleman has looked at the ABTA website. I would be interested in his comments on its credo, which is at the top of its website:
“For more than 50 years ABTA and its Members have been helping holidaymakers to get the most from their travel plans”.
It refers to “Great Service”, stating:
“Because ABTA Members follow our Code of Conduct, you’ll receive a high standard of service, fair terms of trading, and clear and accurate information.”
What does the hon. Gentleman have to say to that credo?
Mark Lazarowicz: I am sure that it is true in many, many cases, but the problem is that in this case it was not what happened to my constituent and his family. My constituent did not have that pleasurable experience, and ABTA seems to have managed to wash its hands of any involvement, which to me is unacceptable.
As I said, when the Minister wrote to me, he suggested that my constituents raise the issue with ABTA, but they have done so without any joy. He also pointed out the possible legal avenues open to my constituents, and indeed there are some, but just as in the case of my unfortunate constituents at Corinthian Quay, it is not so easy for individuals to make use of those rights. Particularly when it comes to package holidays, legislation is often complex and the consumer may not be able to pay for the legal backing to assert their claim against a powerful company that will want to exploit the complexity of the regulations to its advantage.
There is a shortage of legal and other information resources to help consumers in their battles with those who have sold them faulty goods or offered poor services. A strong customer advocate needs to take up that role. From my experience with the bodies that do have that role to an extent—such as trading standards, which is excellent, if I may say so, at Edinburgh council, or Consumer Focus—it is not their role to be an advocate in respect of particular cases in the way that is needed to help consumers in the circumstances I have described. Somebody needs to be encouraged and empowered to do that. Perhaps the way to deal with the issue is to give support to some of the non-governmental organisations to take up the role. Perhaps the Minister can address the issue in the consumer White Paper, which is expected shortly. He may be able to say something about that paper also when he replies to the debate.
I cannot pretend that my final issue has any real connection with the previous two, but I would like to address it briefly as I have the Floor to do so. I am sure that hon. Members are familiar with what are called look-alike websites. Such a website appears to be from a governmental or other public agency, but in fact is not. It may be designed to mislead the consumer, the member of the public, into parting with money in some way or otherwise getting involved in something that the consumer did not wish to be involved in.
Last year, I raised in questions with one of the Minister’s colleagues an official-looking website to which a constituent had logged on and paid money to get a birth certificate. She paid more than twice as much as she would have if she had gone to the official website. She got her money back eventually, after a number of complaints. That company was not bogus: apparently, people would get their document if they paid the money.
However, it was charging two or three times more for documents that were easily available from public websites or other public sources.
There has been some publicity recently about credit advice websites—an issue on which I know the Office of Fair Trading has been active. Those websites give the impression of being linked to bodies such as Citizens Advice, other credit advice agencies or, indeed, Government Departments. I am pleased that the OFT has taken some action to try to deal with the websites in recent months.
A website to which I want to draw attention today because it has recently been raised with me by one of my constituents represents itself as providing an opportunity for members of the public to obtain the European health insurance card—the EHIC. A website whose address, I believe, is www.ehic.org is one that people who do a search are referred to. People can go to that site and pay a much higher price than by going to the official NHS website. I draw attention to that case because it is one of many. I understand that the Government cannot totally control bogus or scam websites that are set up not necessarily from this country, but from many other parts of the world. However, the issue should be monitored closely.
In relation to the website that was providing genuine Government certificates but at a higher price, the response that I received from Ministers here and from the Scottish Justice Minister, to whom the matter was also referred, was in effect that not much could be done about it. Although I accept that not much might be able to be done about it in many cases, the Government and Government agencies should be proactive in trying to monitor the growth of such websites. Where they can take action to shut them down, they should do so. Where proceedings can be taken against individuals who are misleading the public, they should do that. The Government should at least ensure that people cannot get documents through those websites, thereby driving the websites out of business.
That concludes my tour of consumer affairs problems. They are all different, as I said, but they highlight the ways in which consumers can be misled and prevented from obtaining adequate redress. They emphasise the need for the excellent legislation introduced by the Government in this area to be accompanied by effective means of allowing the consumer to make use of it. I hope that by raising the subject today, I have not only highlighted cases affecting some of my constituents—I hope that the Minister will be able to investigate those in detail—but highlighted issues that need to be addressed, because we all know that when it comes to scams, shams, bogus websites and bogus activity, it is a moving target: we have to keep moving to try to catch up with what is going on. I hope that by drawing these matters to the House’s attention today, I have contributed to the debate about how we can tackle these important issues.
11.19 am
Lorely Burt (Solihull) (LD): I congratulate the hon. Member for Edinburgh, North and Leith (Mark Lazarowicz) on introducing this important debate. He has three bees in his bonnet, but lots of other bees are buzzing around on all sorts of consumer protection issues, and I want to address some of those issues in addition to the hon. Gentleman’s points.
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