Huw Evans says Wales needs its own trading standard service
Hidden away on page 22 of the Welsh Labour Manifesto for the May National Assembly election was a commitment to ‘seek to establish a trading standards service” to provide protection against consumer exploitation. However, nothing has yet surfaced about how policy meat might be put on this aspirational bone.
We have a clear understanding of what police officers do but do we have a similar understanding about what trading standards officers do? The term ‘trading standards’ has no legal standing. Legally speaking, for ‘trading standards’ read ‘weights and measures’. Local authorities are designated as Weights and Measures Authorities and, in that capacity, are required to enforce a range of legislation. So the 22 Welsh local authorities operate within a legislative framework that includes weights and measures, unfair trading, product safety, intellectual property, food standards and consumer credit. Like police officers, trading standards officers are given powers of entry, inspection and seizure and also the power to test purchase.
The overall aim of the trading standards service can be described as an attempt to secure a safe and fair trading environment. This clearly involves consumer protection but it also involves protecting legitimate business from rogue business.
In June 2011 the National Audit Office published Protecting consumers – the system of enforcing consumer law. This quoted a Government estimate that the cost to consumers amounted to at least £6.6 billion annually. For mass market scams the estimated cost was £3.5 billion and £1.3 billion for intellectual property crime. No reliable figures were available for doorstep crime but well publicised cases indicate that it is not insignificant. One such case involved the mother of David Cornock, the BBC Wales Parliamentary correspondent, who was conned out of her life savings, of over £270,000. The need for an effective trading standards service to meet and defeat these challenges is obvious.
Yet despite this the Audit Office report states that the Department for Business, Innovation and Skills’ funding for the trading standards service in Britain will reduce from its present level at £213 million to between £140 to £170 million by 2014. Wales’ local authorities will take a proportional hit.
The Audit Office report also quoted Chartered Institute of Public Finance and Accountability statistics for 2000-09 which showed that Wales has 85 trading standards officers, that is one per 28,500 people. By comparison there are 7,422 police officers in Wales. So the trading standards service is certainly not over resourced.
Given the number of officers and authorities and the statutory workload, it is questionable whether it is able to function effectively. Moreover, the changing nature of trading activity is adding to concerns. Local authorities have a duty to enforce the law within their area. However, not least because technological developments such as the internet, trading is necessarily cross-border, whether the borders are local or national. The Audit Office report underlined weaknesses in cross-border working.
Against this background the report concluded, perhaps unsurprisingly, that the system for enforcing consumer law is not delivering value for money. Public confidence in the service has also been adversely affected. An Audit Office survey of consumers found that the satisfaction rating in local protection from unfair trading practices averaged 58 per cent, compared with 69 per cent for the police in a similar study).
Yet paradoxically, the UK Consumer Affairs Minister, Edward Davey has acknowledged the trading standards service has a high level of public trust. Perhaps this can be explained if a distinction is made between the system and the individuals that work within it. So the key question must be to devise a system which does deliver value for money and which utilises the people who deliver that service to optimum effect.
In particular, the Audit Office report identifies the need for more collaborative working by local authorities and other agencies. There are already some examples of collaborative working, especially relating to illegal money lending scams. However, such initiatives are ad hoc and not part of any grand design.
In the main they have involved the creation of regional trading standards working arrangements. Here this has taken the form of the Wales Illegal Money Lending Unit and Scambusters Wales. Both teams operate on an all-Wales basis. Such co-ordinated tackling of illegal money lending has been successful. Prior to the initiative, the offence of unlicensed money lending under the Consumer Credit Act 1974 was rarely prosecuted. In 2007 an evaluation of pilot projects carried out by the former Department of Trade and Industry concluded that:
“Historically the police have not seen illegal lending as a criminal issue and Trading Standards, nominally responsible for the issue, simply lacked the resources and skills to tackle the cases that did arise… As a result illegal lenders have been able to operate with little fear of enforcement…”
Today that position has changed a good deal. Compared with what happened before, the Wales Illegal Money Lending Unit has proved effective. But its future and that of Scambusters Wales is uncertain as continued funding is not guaranteed.
In the meantime the Department for Business, Innovation and Skills is consulting on the institutional change for provision of consumer information advice, education, advocacy and enforcement. That consultation closes on 27 September. Central to the preferred way forward involves the abolition of the Office of Fair Trading and consumer bodies such Consumer Focus and Consumer Direct, with an enhanced role for enforcement by the trading standards service and consumer advice by Citizens Advice.
This is surprising given Vince Cable commitment that “Specific arrangements may need to be made in Scotland and Wales.” However, the door is not closed completely as the following extract from the consultation document shows:
“For Scotland and Wales, the Government’s aim is to ensure consistency and effectiveness of consumer and national enforcement services across the UK whilst recognising the local differences which may exist and respecting the devolution settlements in each case.”
The UK government is consulting about how the trading standards service might be delivered. Welsh Labour has raised the issue of a Wales trading standards service. There is opportunity for change but is there the will to seize it? A Wales trading standard service would be consistent with Welsh Government’s agenda. It would promote economic and social well-being. And it would also help towards achieving sustainable development in the broad way the First Minister defined it in setting out Welsh Government’s first legislative programme. In these devolutionary times surely the presumption must be that specific arrangements need to be made in Wales.