My Lords, Amendment 63C calls on the Government to review how the new powers for collective legal redress are functioning and whether these powers should be expanded to other consumer protection law. It asks the Secretary of State to set out how many private actions have taken place, what redress consumers received and the scope and potential effect of expanding private action powers to cover other areas of consumer protection law.
We welcome the Government’s move to provide new powers for collective legal redress. We do not agree with the scaremongering we have heard on this issue but we are concerned that we get things right. I should stress that the amendment does not call for collective legal redress to be expanded beyond competition law; it simply asks for this issue to be reviewed in the light of the evidence and the efficacy or otherwise of the new powers. This modest request will help identify whether the legislation works as intended. The intention is to make it easier for groups of consumers who have been subject to unfair and anti-competitive practices to put forward a collective claim. The review would also consider the level of redress achieved through joint action, which is often too low to motivate consumers to challenge unfair practices.
Amendment 74A is a probing amendment which seeks to improve scrutiny. At the moment we are being asked to pass into law CMA-approved voluntary redress schemes. These are no doubt a good idea in theory but, in practice, we have no detail in the Bill about how these schemes will work. However, we know that BIS has written a scoping paper which states that a specially constituted board will work out how the CMA alternative dispute resolution procedure will work and how complaints will be handled.
The Minister will no doubt be aware of the concerns raised by Which?, which is looking for answers, as are we all, to some key questions. For example: how will the board be resourced; who will pay for the board; and how will the board assess evidence? Is the board a gatekeeper or an adviser? What will happen if board members disagree? Will the board’s recommendations
be determined by a majority vote or unanimity? Will the infringer get to vote on its own proposals? The answers to these questions will determine whether CMA-approved voluntary redress schemes are a success or a failure.
It is entirely reasonable for Parliament to review the SI that will answer these questions and many others. I beg to move.