Mar282017

Press release: Digital comparison tools could offer even greater benefits – CMA

HM Government
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The Competition and Markets Authority (CMA) has today published an update paper on its market study into digital comparison tools (DCTs).

DCTs enable consumers to compare products and services on quality as well as price, and help them switch between suppliers. These range from price comparison websites to smartphone apps.

The paper unveils a comprehensive consumer survey into DCTs. This shows that overall DCT users think these tools work well, making it easier to make informed choices and save money. Although DCTs are still a relatively new way of purchasing, the survey indicates that consumers are generally confident in the way they use them, and many use more than one site. The majority consider that individual DCTs do not feature all of the suppliers in each market.

DCTs have become an important way for many people to buy services such as insurance and utilities. For example the CMA’s survey showed that in the past year 84% of people looking for car insurance used a comparison site, 67% looking for energy, and 52% for broadband.

The survey found that only 11% of recent users believed that sites covered all suppliers, and that almost two-thirds (64%) of people using a DCT visited more than one site. Many consumers appear to use DCTs for research, with 44% of those who didn’t buy directly through a DCT saying that they used the information they had gathered from a DCT to help them negotiate a better deal with a provider.

Users explain they use DCTs to find a good deal, save time, and research available options, and more than 9 out of 10 say they are satisfied with the service they receive.

The CMA’s update, however, identifies 4 areas of possible concern, which will form the focus for the second phase of the market study.

These are:

  • whether sites could be more transparent – for instance in their market coverage and business models, and in their treatment of personal data
  • whether the benefits that DCTs can offer could be further improved if suppliers made more information available
  • certain practices and contractual arrangements that could limit healthy competition between DCTs
  • the way DCTs are regulated

The CMA is seeking further views on these as it continues the study.

Andrea Coscelli, CMA Acting Chief Executive, said:

Our work so far suggests that digital tools like price comparison websites generally work well for consumers, who really value the service they provide. However, our report suggests that improvements may be necessary to help more people get even better deals.

Among the areas we wish to consider further are what can be done to increase confidence among consumers and how to improve competition, regulation and transparency in the sector. We are now seeking further views on these issues as part of our wide-ranging market study.

The final report will be published by 28 September 2017.

Market studies may lead to a range of outcomes including giving a market a clean bill of health; taking action to improve the quality and accessibility of information to consumers; encouraging businesses to self-regulate; making recommendations to the government to change regulations or public policy, and taking competition or consumer law enforcement action. They can also lead to a reference for a more in-depth market investigation – which the CMA is ruling out in this case as the remaining options are sufficient to remedy any issues that may be found.

Please send comments by 24 April, by email to comparisontools@cma.gsi.gov.uk or by post to:

Digital Comparison Tools Market Study
Competition and Markets Authority
Victoria House
37 Southampton Row
London
WC1B 4AD

Notes for editors

  1. The CMA is the UK’s primary competition and consumer authority. It is an independent non-ministerial government department with responsibility for carrying out investigations into mergers, markets and the regulated industries and enforcing competition and consumer law. For CMA updates, follow us on Twitter @CMAgovuk, Flickr, LinkedIn and Facebook.
  2. The CMA launched its market study into digital comparison tools (DCTs) in September 2016.
  3. The CMA’s working definition of a DCT is: web-based, app-based or other digital intermediary services used by consumers to compare and/or switch between a range of products or services from a range of businesses.
  4. For further information on this market study and to view the update paper, visit the case page.
  5. The results of the consumer survey can be found on the case page.
  6. Market studies are carried out using powers under section 5 of the Enterprise Act 2002 (EA02) which allows the CMA to obtain information and conduct research. They allow a market-wide consideration of both competition and consumer issues. Market studies take an overview of regulatory and other economic drivers in the market and consumer and business behaviour.
  7. Enquiries should be directed to Simon Belgard (simon.belgard@cma.gsi.gov.uk, 020 3738 6472).

Mar282017

Henry VIII clauses

John Redwood MP
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Henry VIII legislation is a pejorative term for laws passed without Parliamentary approval.  The EU has been good at using such powers. Henry VIII sometimes passed laws by proclamation, without reference to Parliament. That is exactly how the EU legislates when it puts through directly acting Regulations. The UK Parliament cannot amend or vote down such laws, but just has to accept them as good UK law. Once we have left the EU there will be  no more directly acting Regulations that Parliament cannot vote down.

Incorrectly some people argue that a Henry VIII clause is a clause in an Act of Parliament which allows government to provide more detail under the Act  by means of Statutory Instrument rather than having to enact further primary legislation. This has been a common practice by governments of all persuasions. Parliament agrees the framework and main provisions of an Act, then allows details like level of charges or dates of implementation to be made by Statutory Instrument. SIs  still need Parliamentary approval. Parliament may  debate any SI it wishes, and can vote them down if they do not suit. Parliament decides when it passes the original primary legislation how much details it is willing to handle at a future date by SI and how much of the detail has to be on the face of the Bill. Any perishable or often changing provision, like a fee or charge level, is often best left to more flexible SIs.

This system has only been extended beyond its desirable limits by substantial legislation required by the EU. Much EU legislation takes the form of a Directive or instruction to the member states to enact laws in line with the Directive. The UK has often done this by means of Statutory Instruments under the power of the 1972 European Communities Act. Large swathes of our environmental, agricultural, trade and many other areas of  law have been put  through by such means. The 1972 Act offered by far and away the biggest extension of the power to government to legislate by SI ever adopted, and it is a power which has been used over and over again since 1972. That will end with repeal of the Act. The government has never been granted the same power to use SIs by non EU Acts.

When Parliament passes the Great Repeal Bill to provide continuity of law as we exit the EU under the Article 50 process it will wish to transfer all existing EU law into UK law, and to allow some future changes to be made by SI where these are tidying up matters. Parliament will not allow the government to create a new fishing policy or a new agriculture policy by SI under the Repeal Act nor will the government demand such power. Once the UK has left the EU and ensured continuity of law, it will then be up to Parliament to decide which areas it wishes to amend or repeal. A new fishing policy, for example, may well  be a priority. That will require a proper White Paper and an Act of Parliament. Brexit is about strengthening Parliamentary and public scrutiny and consent to our laws. Only the EU made law by proclamation ignoring the UK parliament, and only the 1972 Communities Act greatly widened the power to use SIs.

Mar282017

Around 22 million children could soon starve without urgent aid, UNICEF warns

UN – Top News Stories
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28 March 2017 – Millions of children are on the brink of starvation in the worst humanitarian crisis in decades, the United Nations Children’s Fund (UNICEF) today warned, urgently calling for nearly $255 million to respond to immediate needs in northeast Nigeria, Somalia, South Sudan and Yemen.

&#8220Time is running out,&#8221 UNICEF said, noting the threat from famine, drought and war.

Some 22 million children are hungry, sick, displaced and out of school in the four countries, according to the UN agency. Nearly 1.4 million are at imminent risk of death this year from severe malnutrition.

&#8220We learned from Somalia in 2011 that by the time famine was announced, untold numbers of children had already died. That can’t happen again,&#8221 said Manuel Fontaine, UNICEF Director of Emergency Programmes.

Famine was declared a month ago in South Sudan, and will likely be declared soon in Nigeria, Somalia and Yemen where fighting has pushed people off their farmland and droughts have destroyed their animals and what is left of crops.

&#8220Children can’t wait for yet another famine declaration before we take action,&#8221 Mr. Fontaine said.

A mother holds up an empty cooking pot as she crouches alongside her daughter inside their makeshift home at a settlement near the town of Ainabo, Somalia, Thursday 9 March 2017. Photo: UNICEF/Kate Holt

The UN agency is calling for close to $255 million to provide 22 million children with food, water, health, education and protection services for just the next few months, according to a new funding update.

The majority of that funding will go towards nutrition programmes to screen children and provide them with therapeutic food, as well as health services and water and sanitation.

This request is part of a broader appeal for all of 2017 totalling $712 million, up 50 per cent from what was requested for these four countries at the same time last year.