Compensation Bill [HL]

I have become aware of this sort of problem emerging in the credit rehabilitation arena. I have merely become aware of one example; I am sure there will be many others. It is an indication of what we are up against here. This is a company which is offering rehabilitation services. It is contracting with the solicitors acting for the claimant on the following basis: first, it requires payment for rehabilitation services which the claimant may not actually need by stating, very clearly that:"““If the claimant elects to proceed and the arrangements are put in place, a charge representing four sessions will be levied and payable, irrespective of whether the claimant proceeds or not””." And in big black type it says:"““Please ensure the claimant understands this””." Secondly, on payment for the service there is an alternative. Either the firm of solicitors contracting with the company in question has to agree that on completion of the counselling sessions on the claimant,"““I will pay your invoice immediately for which the costs are £100+VAT per session””." Or,"““I agree that on completion of the counselling sessions on the . . . claimant I will receive an invoice for £125+VAT per session after which date I have 10 months extended credit terms to settle the account””." So on the one hand the company which is now providing credit rehabilitation is requiring payment for four services, even though the claimant may use only one session, or, indeed, may not use any of the rehabilitation at all; or, on the other hand, the firm of lawyers has to contract either to pay £100 plus VAT or an enhanced fee for the compensator which rises to £125 plus VAT per session to be paid 10 months later. I am not very good at mathematics, but I think that that rate of interest must be pretty close to 30 per cent. I do not like what is developing in the credit rehabilitation arena. The company here is called P.I.P.S. I do not know what that stands for, but the firm describes itself and the rehabilitation services as P.I.P.S. Counselling Sessions. It obviously needs some further investigation. It may be that the company would want to come forward and justify this, but it demonstrates exactly what is happening in this sector. It is not too far-fetched, as I said before, to imagine in a sector as inventive as this, that if claims management companies are seeking to avoid regulation, they will move into this rehabilitation sector, which is already developing, and will provide all the other services as an ancillary to the rehabilitation that is provided. I know that the Minister shares my concern about these developments, and I very much hope that she will be able to give us some reassurance about the extent to which this sort of activity will be caught. I beg to move.