New reforms to protect consumers hard-earned cash
The UK Government’s Business Secretary, Kwasi Kwarteng, has revealed an arsenal of planned reforms to boost competition and protect the public from rip-offs, fraud and exploitation as the pandemic restrictions lift.
Plans set out in a new consultation will deliver on the manifesto commitment to ‘give the Competition and Markets Authority enhanced powers to tackle consumer rip-offs and bad business practices.’
Business Secretary, Kwasi Kwarteng said: “The UK’s economic recovery relies on the strength of our open markets and consumers’ faith in them.
“By delivering on our commitment to bolster our competition regime, we’re giving businesses confidence that they’re competing on fair terms, and the public confidence they’re getting a good deal”
Protecting consumer rights
In an increasingly e-commerce consumer environment, customers are facing a relentless stream of tricks, designed to make them spend more money than they can afford.
The consultation proposes initiatives to update consumer rights to keep pace with market developments:
- To strengthen protection for consumers investing in prepayment schemes such as the Christmas savings club, being mandated to safeguard customers’ money.
- They also outline plans to clamp down on subscription traps, requiring businesses to be explicit on what exactly it is customers will be signing up for, and allowing them to cancel without any difficulty.
- The consultation highlights the issue of misleading online ratings and commits to criminalising the act of paying someone to write or host a fake review.
Tougher penalties for non-compliance will see increased authority for the Competition and Markets Authority (CMA) to implement fines for businesses who don’t comply.
The CMA will be able to enforce consumer law directly rather than going through the court processes which can take a considerable amount of time.
They also plan to support consumers and businesses to resolve disputes more independently by improving consumers’ access to arbitration and mediation services, without having to go to court. This includes a proposal to make arbitration compulsory in sectors where large, one-off payments are made, for example in the used car and home improvements sectors.
The Government aims to create a competitive, open and fair market, thus achieving its goal of enabling businesses to build again, driving investment and creating more jobs after the pandemic.
Which? Director of Policy and Advocacy, Rocio Concha said: “The pandemic has highlighted weaknesses in UK consumer protections that have allowed unscrupulous businesses to exploit customers.
“The government must now ensure that these proposals are swiftly implemented, and are underpinned by the right resources, so that consumer protection is strengthened.”
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