Rocio Concha is Director of Policy and Advocacy at Which?
As we start to look ahead to beyond the pandemic, the Government will have to grapple with how to stimulate an economic recovery and form public policy agendas for a society that in many ways looks different compared to 18 months ago. While there will be a natural focus on investment, innovation and competition, it would be a fundamental mistake to overlook the vital role which consumers have to play.
Because it will be everyday people that drive our economic recovery. The more confident they feel, the more they are likely to spend and shop around, to stimulate competition and to support innovation by trying new products and services – all things which the UK, and businesses large and small, are relying on to bounce back.
The challenge for the government is a daunting one – and the increase in the time we now spend online is illustrative of the delicate balancing act they must achieve. The ability to work, bank and shop remotely offers huge convenience. Many of the changes people have made to their lives will be here to stay. Yet the increasing move to a digital world has presented problems and risks, such as the significant increase in online scams, that haven’t yet been adequately addressed.
Harnessing the positives and neutralising the risks that have arisen for consumers won’t be easy. Changes that may have taken years have happened almost overnight in some cases and that needs to be caught up with.
At Which?, we believe the government should empower consumers to lead our economic recovery, and there are many ways it can do this. Building on already existing legislation or consultations, there are three areas where Ministers can make markets work more fairly, and bring an end to rogue business practices that all too often see everyday people get ripped off.
First, competition and consumer policy requires reform to give such regulators as the Competition and Markets Authority (CMA) sharper teeth, with proper powers to act as deterrents for unscrupulous companies that break consumer laws. In practice, that means swift and effective redress when customers are wronged, and proper accountability for businesses using unfair practices in dealing with consumers – as some have during the pandemic.
In the digital space, a handful of dominant tech giants, including Facebook and Google, can no longer be allowed to stymie competition and reduce innovation in the sector. The newly-formed Digital Markets Unit, operating out of the CMA, is a step in the right direction – but it won’t protect consumers unless it is equipped with the necessary enforcement powers, including the ability to hand down heavy fines.
Second, if consumers are to feel more confident engaging with new technology and new markets, then they will need to feel safe being online. It is no coincidence that fraud has surged by a third compared to last year. Yet with some of the most sophisticated technology in the world, there are measures that giant online platforms – such as those named above – which so many of us use everyday, can and must do to prevent the avalanche of fake adverts that makes it far too easy for fraudsters to target victims from appearing on their sites in the first place.
Which? research earlier this year found that four in ten investment scams begin online. The government has taken positive action to tackle aspects of online safety by introducing the draft Online Safety Bill – but, as it stands, it will fall short of swiftly dealing with all online fraud. Unless it provides online platforms with the legal responsibility to prevent, identify and remove fake and fraudulent content on their sites, including paid for ads, then fraudsters will continue to exploit their systems and services to carry out a crime that can cause a devastating amount of financial and emotional harm for its victims.
Third, as numerous new tech products furnish our homes, customers must be confident that they are safe to use. Smart gadgets and devices can bring huge benefits to consumers’ lives, but these products must be properly safeguarded with strong security protections to prevent cyberattacks.
The Government’s upcoming Product Security and Telecommunications Infrastructure Bill will scrutinise this. However, if Ministers are serious about cracking down on insecure and unsafe products in our homes, online marketplaces and retailers must be given additional legal obligations in the Bill for ensuring the safety and security of the products sold on their sites – and for customers to get appropriate redress when they buy faulty products.
Taking action in these three areas means that the Government needn’t magic legislation out of thin air to begin empowering and protecting consumers. Indeed, the government pledged to give the CMA enhanced powers to tackle rip-offs in its manifesto.
Here are the foundations from which to make people feel confident that the economy is working for them. To do so would really build back better.