Consumer Credit Bill

My Lords, the general principles for the way in which the OFT carries out its regulatory enforcement activities as a regulator working on behalf of the Crown are set out in Sections 1 to 8 of the Enterprise Act 2002. There are provisions here relating to corporate governance and the OFT board, requiring the OFT to,"““have regard, in addition to any relevant guidance as to the governance of public bodies, to such generally accepted principles of good corporate governance as it is reasonable to regard as applicable to OFT””." There is also a requirement for an annual plan and report which stakeholders, including ministerial departments, are consulted on. The OFT’s more general functions are also set out here, notably that a,"““Minister of the Crown may request the OFT to make proposals or give information or advice on any matter relating to its functions; and the OFT shall, so far as is reasonably practicable and consistent with its other functions, comply with the request””." These ground rules for how the OFT operates were laid down in Parliament when both Houses debated and passed the Enterprise Act 2002. The way in which the OFT should act with regard to its consumer credit functions is set out in Sections 1 to 5 of the 1974 Act. This includes: keeping under review both the Act and the relevant social and commercial developments; enforcement and working of the Act; production of information and advice; and annual reporting obligations on the operation of the Act, as well as the oversight powers of the Secretary of State. The Act sets out fairly clearly the general functions of the OFT. Those include raising public awareness of the benefits of competition and promoting good consumer practice, including through operating arrangements for giving formal approval to codes of practice which are intended to regulate business conduct, with the aim of safeguarding or promoting the interests of consumers. Given that, I believe that what has been set out is already more than sufficient when considering that the OFT is also subject to the usual range of accountability measures such as NAO scrutiny and appearances before Select Committees. Decisions of the OFT could also be subject to judicial review. Obviously that is a last resort, but the fact remains that the sanction is there and could be used if necessary. The amendment also suggests that there is concern about the burdens that may be imposed on business and how these will be constrained. However, the OFT is under an obligation to act proportionately as a signatory to the Cabinet Office Enforcement Concordat, where it is committed to minimising the costs of compliance for business by ensuring that any action it requires is proportionate to the risks, and taking account of the circumstances of the case and the attitude of the operator. So I believe that the amendment simply duplicates existing provisions and is therefore unnecessary. I hope that this explanation will allow the noble Lord to withdraw the amendment.