Consultation to establish a consumer body for Scotland

Scottish Government action

The Working Group raised concerns – around the fragmentation of the landscape, and the need for stronger links between enforcement, advice and redress – that our proposals for Consumer Scotland will not address. However, when Government and frontline experts are both open to change and collaboration, the impacts can be transformative. In this section, we set out how we will work with those who know the landscape best to enhance:

• consumer and wider advice services;
• consumer advocacy; and
• the role of the consumer interest in Scottish public policy and decision making.

Consumer advice

Consumer advice provision must keep pace with the world we live in, and consumers must know where to turn when they need help. This means offering advice in a range of settings and formats, and responding appropriately to support those who are particularly vulnerable and to enable those who can or want to help themselves. Advice services must also align more closely with complaint resolution services and enforcement agencies, so that individual harm can be used to prevent detriment to others.

Discussions in the last two years have revealed that there is work to do to fully realise this system. The Scottish Government has commissioned a pilot project, which aims to unite the online complaints tool, Resolver, with existing telephony services with Citizens Advice Direct. The result should be a more seamless complaint journey ensuring that the service is accessible to all who need it. Strong links have been developed with local Trading Standards Services, and over the coming months, we will be evaluating the pilot to understand where and how it adds value, and how this can be replicated on a larger scale.

We want to supplement the learning from the pilot with the views of those who use and deliver advice services. In particular, we seek views on how advice services currently interact with enforcement and complaint services, and what more could be done within the powers of the Scottish Parliament to ensure that we make the most of the data gathered from advice to prevent further harm.

Finally, we are progressing a wider review of Scottish Government funded advice services. From November 2018, we will take responsibility for levy-funded debt advice, and we continue to fund advice in a range of vital areas, including welfare and general money advice. The complexity of the advice landscape makes uniting these strands challenging, but we are working to ensure that the Scottish Government funding arrangements offer a linked system so that users experience a more person-centred service, and advice providers receive more security and stability.

As we enter the next phase of our work, we will be exploring how our own mechanisms for funding advice services can focus more on outcomes rather than targets and encourage long term, innovative thinking and collaboration. This includes evaluating how we commission and oversee advice, and whether we should pursue new, more holistic methods of doing so, such as an independent commissioning body, or more collaborative funding partnerships.

Questions

8. What are your views on the current consumer advice system? How could it be strengthened?

9. What are your views on how the Scottish Government could improve how it commissions and funds advice to individuals?

Consumer advocacy

Effective consumer advocacy can drive solutions to even the most intractable consumer problems. However, as the Working Group noted, the current model of advocacy is not always effective. There are several reasons for this:

• The range of issues consumers face is becoming more varied – the poverty premium, faulty white goods and power imbalances across complex markets are just some of the issues consumer advocates must try to counteract.
• The volume and sources of data on consumer harm are increasing, making it harder to develop a full picture.
• In complex markets, it can be difficult for organisations to develop or coordinate the expertise needed not only to highlight consumer harm, but also to propose solutions.

In this environment, it is easy for the consumer voice to be lost or for harm to go unnoticed. Our plans for Consumer Scotland, as outlined in the previous section, should be a significant driver of improvements in this area. However, consumers are experiencing harm now, and even in the future, advocacy will remain a powerful tool for issues where Consumer Scotland does not act.

We have therefore begun a review of consumer advocacy to understand which interventions most effectively drive change. We accept that there is no single solution, and it is likely that a range of approaches is needed. New models are already being pioneered –the Water Industry Commission for Scotland, Scottish Water and CAS have co-established a Customer Forum, which brings the consumer voice into complex regulatory issues, such as price reviewing. This shifts the relationship from an adversarial one to a more proactive, collaborative one where consumer needs and views are embedded in decision-making. We will continue to explore these models through our own work, and to support new initiatives through Consumer Scotland.

Finally, we have established a Ministerial Taskforce on Consumers and Markets, which brings expertise together and will act as a coordinating mechanism until Consumer Scotland is established. It met for the first time in February 2018, and already it is driving forward work on issues such as exploring the potential for a single priority register for vulnerable consumers. It is also developing a consumer scoreboard to build a picture of consumer harm in Scotland, so that we can target interventions where they are most needed.

Questions

10. How can consumer advocacy develop greater capacity to bring change for consumers?

Consumer duty

Consumer and public authority action are linked – our own policies can materially impact the lives of consumers, and consumer willingness to embrace our policies can materially impact their success. We must therefore do more to ensure we consider consumers from the very start of our policy-making.

Failing to do so can be costly. The National Audit Office ^[2] concluded that the Department of Energy and Climate Change’s Green Deal design not only failed to deliver any meaningful benefit, it actually increased suppliers’ costs – and consequently consumers’ energy bills – in meeting their obligations through the Energy Company Obligation. The National Audit Office stated there was a need to be realistic about consumers’ and suppliers’ motivations when designing schemes in future.

Many of our most important priorities, from increasing energy efficiency to encouraging business to pay the living wage to protecting our environment from harmful plastics depend on consumer co-operation. Equally, when we make policies that limit competition in a particular field, or increase prices or reduce the help available to consumers, we run the risk of increasing individual hardship and collective mistrust of institutions. We want to avoid these mistakes, and are developing a range of mechanisms that could ensure consumers receive full consideration when developing new policies.

We are seeking views on whether these efforts should be formalised by a statutory duty for Scottish Government and public bodies carrying out devolved functions to consider consumer impacts when developing policies and taking strategic decisions. This is early stage thinking, and we recognise that careful implementation would be needed to ensure it had a tangible impact and did not create an undue burden on public authorities. We would therefore explore in partnership how best to implement such a duty, including through existing means.

Questions

11. What are your views on whether there should be a duty on public authorities to consider the impacts on consumers of policies or decisions?

12. Beyond those actions set out in this section, how should Scottish Government use its resources and powers to improve outcomes for consumers?