Consumer Protection from Unfair Trading Regulations 2008

My Lords, first, I join the noble Baroness, Lady Wilcox, in welcoming my noble friend to his new responsibilities on the Front Bench and I congratulate him on his elevation. I join this debate primarily as the chairman of the Advertising Standards Authority and, in that role, I give a warm welcome to these two instruments. The Government have succeeded in implementing the European directive skilfully and in aligning business-to-business provisions alongside that. The directive of course primarily deals with business-to-consumer issues. They also have found the right sort of balance between protecting the interests of the consumer and the interests of legitimate business. The Advertising Standards Authority is the UK’s self-regulatory body for regulating advertisements appearing in all forms of media. For the past 45 years it has been responsible for upholding standards in advertising and for ensuring that consumers are protected from misleading and unfair advertisements. On the whole, it has done a pretty good job, including under the distinguished tenure, as chairman, of my noble friend Lord Borrie, from whom I took over some nine or 10 months ago. The ASA has been fully engaged with the Government, the Office of Fair Trading and consumer organisations in the discussions around the putting together of these two instruments. We have found the Government’s approach to be inclusive and constructive. We welcome the regulations. Under the existing consumer protection regime, the ASA is regarded as the ““established means”” for enforcing the Control of Misleading Advertisements Regulations 1988 and, where appropriate, we co-ordinate our work with the Office of Fair Trading to ensure that standards are maintained. Noble Lords may have noticed that in the past week we have had occasion, with some reluctance, to refer one particular airline to the Office of Fair Trading for consistent breaches of the advertising codes. The ASA is very pleased to have had its status confirmed in both these sets of regulations as the ““established means”” for protecting consumers from misleading and unfair advertising. In doing that, the regulations acknowledge the important role that the self-regulatory ASA plays in protecting UK consumers and in maintaining a level playing field for business. The ASA responds to more than 24,000 complaints each year and conducts proactive monitoring and compliance work to ensure that advertisements are compliant with the advertising codes, regardless of whether or not a complaint is received. This generally leads to around 2,500 advertisements being changed or withdrawn each year as a result of ASA action. The advertising self-regulatory system is an excellent example of better regulation at work. Our work on misleading advertising means that many cases do not have to be dealt with by the courts or by statutory regulators—indeed, trading standards officers currently refer quite a number of cases to us. This is an important point because our work saves the public purse a good deal of money: the advertising self-regulatory system is funded by industry via a levy on advertising space. The ASA is not only an example of better regulation but also a strong supporter of the Government’s better regulation agenda. We are encouraged that this agenda appears to have been followed in constructing these regulations. However, I have to ask my noble friend one question. The better regulation agenda makes clear that enforcement action should be proportionate to the risk posed, but that is not entirely clear from the regulations, which touches on the point raised by the noble Lord, Lord Razzall. In the light of this, will the Government be able to confirm that it is their intention that enforcers of these regulations should follow Hampton principles when enforcing the regulations and so use the most appropriate mechanism to achieve compliance? Specifically, will the Government confirm that enforcers should normally seek to escalate their compliance action from low-level intervention and retain criminal enforcement for only the most serious of cases? Certainly, in the case of advertising, this would lead to more frequent use of the ASA. Loath as I am to increase our workload, none the less, we would welcome the role that this would place on us. The reliance on a single regulator will lead to more consistent regulation, thus achieving another Hampton principle. It would also have the added benefit of leaving trading standards officers with more time and resources to pursue serious cases of infringement. The Advertising Standards Authority is very pleased to be recognised in these regulations, welcomes them and would be grateful for the assurance that we have sought from my noble friend.