New competition authority will deal with some consumer complaints, says Government

The Competition and Markets Authority (CMA) should have the authority to intervene when the public are disadvantaged by the way consumer markets are controlled by businesses, the Government said. Under existing Government proposals the CMA would merge the competition functions of the Office of Fair Trading and the Competition Commission.

"It would have powers to investigate markets in which there are, or may be, structural problems and to use competition or consumer law to resolve these," the Government said in a consultation (99-page /696KB PDF) on new consumer protection measures.

"The CMA consumer enforcement powers should be restricted to the remedying of structural problems in markets, they should not be used for pursuing individual breaches of the law or remedying a perceived unfairness in the way certain consumers are treated when this is unrelated to competition and broader market concerns," the Government said.

In its consultation, Empowering and Protecting Consumers, the Government also proposed to give Trading Standards, which enforces consumer laws in the UK, national funding which the Government said would help it "integrate" its local monitoring of unjust business practices.

"The Government proposes to deploy national funding to facilitate a more integrated approach to national and cross-boundary threats," the consultation said.

"This activity would be more effectively coordinated at national level by Chief Trading Standards Officers to ensure that enforcement gaps do not arise and that activity overall is better targeted," the Government plans said.

"It offers the best prospect of both improving leadership and coordination of Trading Standards enforcement across local authority boundaries and maintaining the advantages of integrated analysis of markets at national level from both a competition and a consumer perspective," the Government said.

The Government said Trading Standards currently receives most of its funding from local authorities but that a recent National Audit Office report had found that 73% of unfair activity spanned more than one local authority boundary. This represented £4.8bn worth of rogue and unfair business practice.

Giving Trading Standards more responsibilities would mean it taking on the guidance, training, international liaison and policy functions of the Office of Fair Trading, the Government said.

The Government also announced plans to streamline the advice services available to consumers. It said that the vast majority of Government funding will go to the Citizens Advice service which will have "principal" responsibility for delivering consumer information to the public.

"[The Government] intends to integrate existing publicly-supported sources provided face-to-face (Citizens Advice Bureaux and Trading Standards), by telephone (Consumer Direct, the Citizens Advice service and sometimes Trading Standards) and online (direct.gov, OFT, Consumer Direct, the Citizens Advice service, BIS, Consumer Focus and Trading Standards) into a single public offering delivered through the Citizens Advice service," the Government said.

"This would have the huge advantage of simplicity for consumers, but also of helping advice to be provided through the most efficient route and thereby reaching a much greater number of consumers," the Government said.

"The Government would expect the Citizens Advice service to work closely with Which? and other organisations in developing and delivering its advice and advocacy functions," the Government said.

There are too many advice and information services currently available, the Government said. This is inefficient, leads to overlapping of services and confuses the public about the roles and responsibilities of the organisations that provide the information, it said.

The Consumer Focus group, which currently shares funding for delivering consumer advice, should be abolished, the Government said.

"Combining the expertise of the two organisations and enhancing the link to local consumers should improve the evidence base and research capability and help ensure that the issues affecting consumers are effectively tackled," the Government said.

Whilst the institutions should be primarily responsible for consumer protection issues, the CMA, Trading Standards and the Citizens Advice service should work in partnership with other organisations with expertise in consumer advice, representation and enforcement matters, the Government said.

The Government says the "light touch" non-regulatory proposals are aimed at "reducing the complexity of the consumer landscape, strengthening the effectiveness of consumer enforcement [and a] more cost-efficient delivery, closer to the consumer front line".

The consultation is open to responses until 27 September.

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