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Lord Graham of Edmonton: I shall speak to Amendments Nos. 44, 47 and 48, which are grouped with Amendment No. 42.

I am grateful for the temperate language that has been used to skate around what can undoubtedly be a sensitive issue—that is, consumers versus business

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interests. Everyone is conscious that the consumer movement and the Consumer Association are impeccable in many ways, but in the context of the Bill the question needs to be asked whether in practice under the super-complaints procedure there is a danger of a lacuna appearing after the event. I hope that the Minister will look on this series of debates as providing him with an opportunity to tell the Committee not only that we have got it wrong but that we have said sufficient for him to think again.

I have concerns about the introduction of super-complaints on a statutory basis although it is an extension of current procedures. Consumer groups able to bring such complaints should not themselves have a commercial interest in the same area if the system is to be seen to be fair. That point was made by the noble Lord, Lord Sharman. If we are to avoid costs to business, the OFT must deal with such complaints judiciously and only on the basis of clear evidence of abuse. We question any extension of such complaints into the US-style class actions which could lead to excessive claims with resultant costs for consumers as a whole. I fear that the Government may already have embarked on such a path without further discussion on the introduction of damages for consumers under the law.

The Consumers Association is not a representative body but a private club or special interest group with its own commercial trading interests. That is perfectly fair. I was a member of the Consumers Association when it was established. I believe that we all support it. However, enforcement agencies should be independent, accountable to public authorities of one kind or another and not at the same time the competitor of those against whom they are potential enforcers. Those are legitimate questions. As I indicated earlier, I have taken advice from the British Retail Consortium, which is associated with the All-Party Retail Industry Group.

I support Amendments Nos. 44, 47 and 48 which stand in my name. Amendment No. 44 proposes the following paragraph,

"is not itself a trading body or connected to a trading body which could itself be the object of a complaint".

The Minister may say that he is not prepared to accept the amendment as I am trying to read too much into the situation. That may be correct.

Amendment No. 47 proposes the following paragraph,

"and is genuinely representative of the collective interests of consumers and exists solely for that purpose".

Again, the Minister may tell us that that "ain't necessarily so".

Amendment No. 48 proposes the following paragraph:

"No body may be designated where that body, or any person or body connected with that body for the purposes of conducting a business, could itself be the object of a super-complaint".

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The Minister and his advisers who have consulted on the matter have their own sense of what is right. However, can the Minister assure me and many others that our sense that there may be an injustice here is unfounded?

Lord Sainsbury of Turville: I wish to speak to Amendments Nos. 42, 43, 44, 47 and 48. There are essentially two issues here. One is the request for reassurance that the designated bodies will be sufficiently representative of the legitimate interests of consumers. The second issue concerns how we deal with those bodies which have a trading arm. I shall deal with those two issues in turn.

As regards the designation of bodies, we have given a commitment to publish the relevant criteria. Only groups that request super-complaint status can be designated. The Secretary of State will publish the criteria against which possible candidates will be assessed. It is thought that the criteria will include requirements that bodies act independently and with integrity while being impartial. In addition, bodies will be expected to demonstrate that they represent and/or protect the interests of consumers and that they have the capability to put together reasoned super-complaints. We shall consult fully on the criteria. The Secretary of State will also issue guidance on the application procedure. The Secretary of State will be able to amend the list of designated super-complainants.

The second question concerns the anxiety about a conflict of interest if consumer bodies have the right to bring super-complaints in which they have a commercial interest, for example making a complaint against a business that is in competition with its trading arm or even being the object of a super-complaint itself. I should like to assure the Committee that the criteria will act as a safeguard against such an occurrence. It is intended that the designation of bodies with trading arms will include provisions to ensure that any potential conflicts of interest are properly dealt with. We believe that the fact that a body has a trading arm should not disqualify it from super-complainant status, provided that the trading arm does not control the body and that any profits made by the trading arm are used only to further the stated objectives of the consumer body. The overall purpose of such bodies should be the representation and/or protection of consumers, not the commercial activities of its trading arm.

Excluding bodies with trading arms would exclude many charities which often use commercial activities to fund their consumer representation or protection work. It is worth remembering that if designated bodies breach any of the criteria, the Secretary of State will be able to remove their designated status. As I said, we shall consult fully on the criteria and this will give all interested parties an opportunity to raise their concerns. They will be better able to do so once they have seen the criteria.

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It is therefore clear that we have recognised that a potential problem exists. The criteria will make it clear that we will have procedures in place which will deal with the question of whether the super-complainant bodies are able to represent the interests of consumers generally and the fact that there can be no conflict of interest when they have trading bodies. We do not want to rule out all bodies which have a trading arm because we believe that that will disqualify too many of the bodies we want to see acting in this way.

With those reassurances, I invite Members of the Committee to withdraw their amendment.

Lord Hunt of Wirral: I am grateful to the Minister for his reassurance. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

10 p.m.

[Amendments Nos. 43 to 48 not moved.]

Lord Sharman moved Amendment No. 49:

Page 5, line 12, at end insert—

"( ) The Secretary of State shall review the status of a designated consumer body not less than every 12 months to determine whether such a body is an appropriate body, under subsection (6)(a) and (b), to retain the right to raise super-complaints to the OFT."

The noble Lord said: This is the final amendment in the group which deals with the designation of consumer bodies entitled to bring super-complaints. The Minister has already stated that where a designated body fails to maintain the appropriate status it will be de-designated; its right to bring such a complaint will be removed.

The objective of the amendment is to ensure that the status of so designated consumer bodies is reviewed on a regular basis. We have taken as an example every 12 months but that is not cast in stone. Consumer bodies may not be bringing complaints all the time but they may be changing their status or arrangements. We believe that it will be appropriate for the Secretary of State to conduct a regular review of those bodies. I beg to move.

Lord Kingsland: I have two amendments in the group. They point in the same direction as that tabled by the noble Lord, Lord Sharman, but journey a little further down the road. The intention of the amendments is to probe the Government's lack of power under Clause 11 to de-designate a body once designated. The noble Lord, Lord Sharman, has an elegant and kindly proposal in Amendment No. 49 and the Minister may feel that the Opposition Front Bench is being uncharacteristically harsh in its Amendments Nos. 50 and 51.

My concern here is not so much to take a "drop dead" approach, but to ensure that on the face of the Bill there is a clearly stated mechanism for reviewing

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the performance of a designated body, containing criteria for removing it from the list in appropriate circumstances.

Lord Brennan: Perhaps I may raise two points. The first relates to the period of 12 months which Amendments Nos. 49 and 51 seek to introduce. That, it seems to me, would be an unduly onerous requirement on properly designated bodies. They would be spending the last three months of each year meeting a bureaucratic requirement to confirm that whatever standards that are thought necessary are being met.

Much more important, however, is Amendment No. 50, which has within it an implicit message which I fear is entirely wrong. It assumes that upon the making of a complaint the OFT must come to a conclusion which involves action or no action. But surely that does not pre-empt the OFT, on the receipt of a complaint, in addressing that complaint to the affected commercial entity with a view to its accepting the substance of the complaint or coming to some satisfactory arrangement that does not require the OFT to take action. Clause 50 as presently drafted would pre-empt that short-term effective compromise solution, which I hope is implicit in these procedures.

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