Consumers, Estate Agents and Redress Bill [HL]

The effect of the amendments would be to remove the Consumer Council for Water from the scope of the Bill, including consolidation into the new council and the extension of redress schemes to the water sector. I am grateful to Members of the Committee for enabling us to debate this important issue, which focuses on the core objectives of the Bill to create a stronger, cross-sectoral consumer advocacy body while making consumer representation and redress simpler but more effective for the consumer. Clauses 30, 31 and 32 concern the potential inclusion of the Consumer Council for Water in the new arrangements at some point in the future. Bringing the water sector within the scope of the new arrangements would only happen after proper public consultation and only if the results of that consultation showed that consumers in the water sector would receive real benefits from coming within the new arrangements. Amendments Nos. 109 and 110 would remove the water sector from Part 2 of the Bill. This would have the effect of removing the possibility of extending redress schemes to the water sector even after consultation in 2008. So, in effect, there would be no form of redress for consumers in that area. Our intention is to strengthen consumer representation and redress by extending redress schemes to the water sector to ensure that consumers benefit from complaint resolution rather than simply complaint handling. Only independent redress schemes which can award redress—such as an explanation, an apology or compensation as appropriate—and whose decisions are binding on suppliers can offer consumers certainty of complaint resolution. I listened carefully to the points made by the noble Baroness, Lady Miller of Chilthorne Domer, but Amendment No. 101 is all about seeking to delay the consultation on the inclusion of the water sector until 2011. This may not necessarily be in the best interests of consumers. The noble Earl, Lord Selborne, also focused on the timeline. My right honourable friend Ian McCartney MP has agreed to meet with Ofwat and the CCW to discuss the timescale for water in this regard. The public consultation held by my department earlier this year sought views on the best time to consider the question of the inclusion of the water sector in the new arrangements. Some respondents agreed with the noble Baroness that the consultation should be later than the proposed date of 2008. However, many other respondents believed that the water sector should be included from the outset. There was a whole range of views. We took the view at the end of that consultation that we would consult on the inclusion of the water sector in 2008. That recognises that the Consumer Council for Water needs time to establish itself and to start to tackle the new, important objectives that it has been given. However, consulting in 2008 will provide for a timely assessment of consumer representation in the water sector, to ensure that consumers in this sector benefit from the most effective system of consumer representation and redress available. If incorporated, the new NCC would take over the functions of the CCW and could be a stronger advocate for consumers than the current body. I refer to the points that my noble friend Lord O’Neill of Clackmannan made earlier. If it was incorporated into the NCC, it would of course maintain the existing sector expertise which currently the CCW has. All these issues are being discussed. Consultation is ongoing. I am giving the Committee the logic behind the Government’s position after an extensive consultation on the timeline. That is how we arrived at the point we are at today. Moving on to Amendment No. 115, Clause 46 relates to orders that may be made by the Secretary of State requiring regulated suppliers to belong to a redress scheme. The amendment suggests that subsection (5) of Clause 46 is removed from the Bill. Subsection (5) provides that the consent of Welsh Ministers must be obtained before the Secretary of State can, by order, require a regulated supplier in the water sector for an area which is wholly or mainly in Wales to belong to a redress scheme. The Water Industry Act 1991, as amended by the Water Act 2003, devolves to the National Assembly for Wales certain interests in respect of water. The Government of Wales Act 2006 will transfer these functions to Welsh Ministers. It is likely that the power to require water and sewerage undertakers in Wales to belong to a redress scheme may affect devolved matters in Wales. I believe that it is appropriate to obtain the consent of Welsh Ministers when dealing with certain issues in relation to the water sector. For the reasons I have given, I am not convinced that the proposed amendments represent the best way forward for consumers in the water sector at this point. Therefore, I support the retention of Clauses 30, 31 and 32.