Consumer enforcement system on verge of collapse, Which? warns
The UK could be left exposed to increasing levels of food poisoning, scams and potentially even deaths caused by unsafe products unless the broken consumer enforcement system is radically overhauled, according to a new report from Which?.
The warning is included in ‘Creating a successful enforcement system for UK consumers’, which sets out a series of reforms designed to address chronic weaknesses in the consumer protection system.
The report highlights how the current structure is far too reliant on increasingly overstretched local authority Trading Standards Services, and argues that the system needs to move away from the current David and Goliath approach to enforcing consumer rights in complex consumer markets.
In order to do so, the consumer champion believes the responsibilities of the Competition and Markets Authority should be expanded to create a Consumer and Competition Authority, which will proactively lead on the enforcement of consumer rights and fair trading law.
The consumer champion is also advocating for an independent product safety body that can provide specialist expertise and take on issues of national significance.
With a duty to put consumer interests first and operate transparently, it would have the power to take on multinational businesses, stopping dangerous products from making it to the shelves and forcing recalls of unsafe products when companies fail to do so.
Which? believes the Government’s shambolic handling of the Whirlpool tumble dryer saga, which left up to a million fire-risk tumble dryers still in people’s homes, is a clear example of where the safety system is crying out for reform.
The need for fundamental change is reinforced by Brexit. There has already been speculation that the CMA’s consumer protection work could suffer as a result of having to take on much of the competition work that is currently done at European level, so it’s crucial that a comprehensive consumer enforcement system is equipped to handle that additional burden.
The report also highlights the need to provide regulators with effective powers and to take action when companies are found to be breaking the law. This includes a call on the Government to give fining powers to consumer enforcers.
This would bring powers in line with competition law, where a company can be fined up to 10 per cent of its turnover. High-profile organisations that regulators have recently taken legal action against – but without facing the risk of significant financial penalties – include Viagogo, Ryanair and Care UK.
Which? believes that in many cases the threat of such massive fines will deter rogue business practices and encourage positive change from companies before enforcement action is required.
It also wants the Food Standards Agency’s National Food Crime Unit to be given investigatory powers and the display of food hygiene ratings to be made a requirement across the UK, as is already the case in Wales and Northern Ireland.
Other recommendations include major reforms of the dispute resolution and ombudsman systems, to ensure firms that rip off their customers can no longer avoid being held accountable.
Caroline Normand, Which? Director of Policy, said:
“British consumers have strong rights and protections on paper, but a broken enforcement system means rogue firms can rip off customers or dismiss their complaints – and get off the hook far too easily.
“As Britain prepares to go it alone outside the European Union, now is the time for fundamental reforms to ensure consumers are properly protected from online scams, rip-off prices and unsafe products.”
Notes to eds
- A copy of Creating a successful enforcement system for UK consumers is available on request
Press Release