APPENDIX 1: CONSUMER RIGHTS BILL: GOVERNMENT
RESPONSE
I am grateful for the Delegated Powers and Regulatory
Reform Committee's Third Report of Session 2014-15, published
on 11 July 2014, which considers the Consumer Rights Bill.
The Report made recommendations that the powers conferred
by clause 85(1)(a), clause 87, paragraph 8(2) of Schedule 3, and
new section 47C(7) inserted into the Competition Act 1998 by paragraph
6 of Schedule 8 should be subject to the affirmative procedure.
(1) Clause 85(1) allows the Secretary of State
to make regulations to impose functions on a local authority regarding
the enforcement of the duty on letting agents in clause 81 to
publicise details of relevant fees, and for civil penalties to
be imposed. The Committee recommended that this power be subject
to the affirmative procedure.
However, having reflected further on the matter
and taking into account the point made by the Committee, we have
decided to include the detail about enforcement on the face of
the Bill, rather than by subsequent regulation.
To ensure that these details are fully future-proofed,
I propose to include a new power in the Bill that will enable
the provisions to be amended, and this will be subject to the
affirmative procedure.
(2) The power in clause 87 allows the Secretary
of State to make consequential changes, including those that modify
an enactment. I believe that enabling consequential modifications
is important to fully future-proof the Bill, so we must retain
that provision. However, I agree with the Committee that such
consequential changes certainly are no less significant than textual
amendments to primary legislation. I am therefore happy to accept
the Committee's recommendation that this power be subject to the
affirmative procedure where used to modify primary legislation.
(3) The power conferred by paragraph 8(2) (and
further detailed in paragraph 8(5)) of Schedule 3 allows the Secretary
of State to amend the list of bodies which regulate unfair terms
and make consequential amendments (and transitional provisions).
This provision is needed because we cannot anticipate what future
changes may be needed to the list of regulators, if and when the
regulatory landscape changes. I agree with the Committee that
this sort of change is substantive, not procedural or administrative,
and I am therefore happy to accept the recommendation that the
power be subject to the affirmative procedure.
(4) Section 47C inserted into the Competition
Act 1998 by paragraph 6 of Schedule 8 provides for damages in
successful collective action proceedings that are not claimed
within a certain period are paid to a charity prescribed by the
Lord Chancellor. The Access to Justice Foundation is currently
the only such prescribed charity. Again, the approach we have
taken here is to ensure that the policy is future proofed against
any change in the prescribed charity. Therefore section 47C(7)
allows for the Secretary of State to amend the body prescribed
in section 47C(5). Since the power is likely to be used only very
rarely, I am content to accept the Committee's recommendation
that the power be subject to the affirmative procedure. The relevant
references to section 47C within the Bill will be amended to reflect
this (and to update a cross-referencing error). I am also content
to go further by limiting the power so that only a charity can
be prescribed in section 47C(5).
The Government has today laid amendments, for consideration
in Grand Committee in the House of Lords, which make these changes
to the Bill.
Paragraph 12 of Schedule 8 introduces Section 49C
into the Competition Act 1998, permitting the Secretary of State
to make regulations relating to the CMA's redress power. The
Committee sought further explanation about use of the negative
procedure.
We have specified the negative procedure for this
in the Bill because the regulations concern purely procedural
matters. The regulations will state the minimum components that
must be included in a scheme before it may be considered for approval.
However, as the exact nature of individual schemes will vary,
the regulations will not contain criteria as to how they should
be assessed. The approach taken here is similar to the approach
taken in other parts of Schedule 8: to create a framework which
allows the relevant bodies to make assessments on a case-by-case
basis. There is no intention for the Regulations to detail the
underlying policy, or to prescribe how an assessment should be
undertaken.
I am placing a copy of this letter in the Libraries
of both Houses.
Jo Swinson MP
Parliamentary Under Secretary of State for Employment
Relations and Consumer Affairs
6 October 2014
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