Response to the Working Group on consumer and competition policy

Redress

The Working Group identified the need for a strong system of consumer redress to make it easier for consumers to resolve consumer complaints outwith the court system. It noted that consumer redress is often a cheaper, more accessible means than the courts for consumers to pursue complaints that cannot be resolved with businesses.

The Working Group found that many consumers find it difficult to know which redress provider to turn to in a complex and fragmented landscape. Equally, many businesses are unaware of the availability and advantages of consumer redress.

The Working Group recognised that policy responsibility in this area will continue to be reserved to the UK Government. However, it recommended work to scope usage of consumer redress by Scottish consumers and to understand the barriers that prevent consumers and businesses from accessing it.

The Working Group recommended that Consumer Scotland should take forward work with redress providers to improve awareness and access by Scottish consumers and businesses, and to promote the adoption of common procedures and adherence to best practice principles. It also identified a need to join up services within the consumer redress landscape (encompassing ombudsman services, mediation, arbitration, courts and tribunals) and to improve links with other parts of the wider consumer protection landscape.

Scottish Government's response

The Scottish Government is concerned that implementation by the UK Government of the recent EU Directive on Consumer Dispute Resolution ^[4] has done little to improve access to consumer redress and, in some respects, has increased confusion by establishing a number of bodies to set standards.

The complexity and fragmentation of the landscape means that opportunities are currently not taken to harness and aggregate complaints data. We agree with the Working Group's assessment that redress providers should be using this information to work with companies or sectors to deliver improvements, much as the Scottish Public Services Ombudsman ( SPSO) does for public sector organisations in Scotland.

We want to ensure that businesses striving to remain competitive and to retain customers view complaints as an incentive to improve rather than a burden.

Improving co-ordination between redress providers and their links with advice providers and enforcement bodies will make it easier to identify less scrupulous traders and to take punitive action when it is required.

We will continue to work collaboratively with UK Government and redress providers to deliver the above improvements.

Next steps

• In considering the possible form and functions of a dedicated consumer protection body, we will take account of the Working Group's recommendations for better integrating redress provision within the consumer landscape in Scotland.
• We will work with redress providers to raise awareness, amongst the public and businesses, of consumer redress mechanisms including consumer ADR services, ombudsman schemes and legal mechanisms.
• We will identify barriers to use of consumer redress and practical measures to overcome these.
• We will explore the feasibility of creating a single portal for consumers, to ensure their referral to the most appropriate advice or redress provider.
• We will work with stakeholders to promote a more joined-up approach to consumer redress, the adoption of common procedures, and adherence to best practice principles.