Critics warn reforms will lead to less protection against scams, rogue traders and rip-offs
Shoppers are being put at risk of scams and rip-offs because of a row between the prime minister and the business secretary, Vince Cable, over who is in charge of protecting consumers.
The bodies currently responsible for looking after consumers' interests were to be abolished or merged under reforms announced by Cable in October 2010. But David Cameron is blocking the changes over concerns about the �8m transition costs and the likely upheaval.It is understood that amid the indecision Consumer Focus, a body responsible for looking after consumers and able to fine companies for poor conduct, has been unable to hire new permanent staff and has had to make an emergency appeal to the government for additional temporary workers since it was put on notice of its abolition.
A source in the consumer protection sector said there was "no doubt that consumers are less well protected and therefore more susceptible to fraud and bad business than a year ago because of the chaos at the centre of government".
The source added: "The general consensus is that the Department for Business is in disarray over this, but the problem is that it will be consumers who suffer because of it. The range of scams on consumers is multiplying, yet the bodies responsible for protecting them are being degraded."
Along with cuts to local authority funding for trading standards, the disarray among the bodies in place to tackle the poor and fraudulent treatment of consumers is heightening the risks shoppers face. Under the government's stated plans, the functions of Consumer Focus were to be taken on by Citizens Advice, a charity, and the trading standards offices of local councils, but Cameron believes the reform is unworkable.
The Department for Business said it would continue in its reorganisation work and efforts to persuade the prime minister.
Cable and Ed Davey, the consumer minister, believe they are already committed to seeing the reforms through and are reluctant to make a U-turn.Dr David Halpern, a senior fellow at the Institute for Government, currently on secondment to both No 10 and the Cabinet Office to head the behavioural insight team, is said to have been given the role of trying to find a compromise between Cameron and Cable.
Richard Lloyd, executive director of the independent consumer watchdog Which?, appealed for the government to reconsider its plans. "It's bad for consumers struggling in tough times if the system that's there to protect them from scams, rogue traders and rip-offs gets stuck in an ill-conceived quango reorganisation.
"What's even worse is that these changes would take years to implement and come at a cost of many millions of pounds to the public purse. Ministers should clearly demonstrate that their plans will absolutely improve the overstretched consumer protection system.
"After months of indecision, it now seems obvious that the government should rethink this expensive exercise in moving civil servants and functions from one institution to another.
"Which? thinks that the priority should be first to protect the budgets of frontline consumer law enforcement and advice agencies and concentrate on getting the existing publicly funded organisations to work together much more effectively."
Last month parliament's public accounts committee criticised the state of consumer protection in the UK and reported that people were increasingly falling prey to problems involving online shopping, such as email scams or fraud using credit cards. Its chairman, the Labour MP Margaret Hodg,e said: "Consumers are being ripped off to the tune of �7bn a year by sellers of defective goods, dodgy doorstep traders and online fraudsters."
A Department for Business spokesman said: "We are still considering responses to the recent consultations, but the government's priority is to strengthen, not diminish, protections for UK consumers. Consumer Focus, the Office of Fair Trading and the Competition Commission remain committed to protecting consumers while decisions are being made."
Source: http://www.guardian.co.uk/money/2011/dec/18/consumer-protection-reform-vince-cable-david-cameron
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