Clamping down on rogue traders

Historically responsible purely for ensuring one standard measure throughout the land, dating back to before the Magna Carta, trading standards are now involved in everything from doorstep sales and distraction burglary to foot and mouth disease and blue tongue.

In 2004, the chancellor commissioned Philip Hampton to review the regulatory arena to consider ‘the scope for promoting more efficient approaches to regulatory inspection and enforcement’.

His report, issued alongside the 2005 Budget, informs much of the Regulatory Enforcement and Sanctions (RES) Bill.

The Bill will establish the Local Better Regulation Office as a statutory corporation to co-ordinate the efforts of local authorities and local and central government. A suite of civil and criminal powers are also proposed in the Bill for local authorities and other central government regulators like the Health and Safety Executive. The Bill’s aim is that local and central government regulators will operate under a new regime, underpinned by a statutory compliance code. It will encourage best practice amongst regulators, especially local ones.

Proportionality will be the key determinator of all sanctions, so that they discourage repeat behaviour but allow the perpetrator to become compliant. The new sanctions regime stretches from fixed and variable monetary penalties that have proven their worth in under-age sales enforcement, to restorative powers and stop notices. These monetary penalties are a proportionate response to under-age sales without the need to tie up the Magistrates Court and the label of criminality associated with them.

The Bill will empower the Local Better Regulation Office to challenge local authorities practices and set priorities for local government regulators. It will have a major role to play in encouraging business partnerships through the ‘primary authority principle’, giving every business trading across local authority boundaries the option to have one local trading standards office as the company’s national partner; this office will act as a one-stop shop for co-ordinating all the company’s compliance issues and provide it with a source of good business advice. One key benefit is to allow the company and the primary authority to prepare jointly an appropriate inspection plan, which can also inform other authorities about the nature and risks associated with the business

However there is a lack of clarity concerning whether it replaces the current arrangements, known as the ‘home authority principle’, as it does not seem to encompass all of its aspects, such as providing a conduit for complaints from other local authorities about the business. If the home authority, a voluntary arrangement, has to continue to perform functions like this, it will only add to the confusion; remaining home authority functions need to be incorporated into the primary authority principle.

This would build upon the success of the home authority principle, but, with its new statutory status would put it into practice nationally. It would empower primary authorities to control enforcement actions against their nominated companies — actions inconsistent with advice or guidance agreed with the primary authority will not be allowed to proceed. Some may find this challenging.However, professional regulators operating within a new professional competency framework, facilitated by the Local Better Regulation Office, should find that the new regime works very effectively.

There are a few details that the Bill needs to correct from the start, not least empowering the local regulator to take immediate enforcement action without reference to the primary authority where, for instance, food is out of date or weighing scales are inaccurate.

It is disappointing to see that the enforcement for non-payment of monetary penalties will be treated as a civil debt and that regulators will not have the power to apply alternative sanctions should a business fail to comply.

Under the Bill, fines paid will go to the consolidated fund. It would be more advantageous if they went to a prosecution fund managed by the Local Better Regulation Office.

The new powers, sanctions and legislative changes this Bill would introduce should make co-operation between business and regulators easier, whilst targeting rogue traders. Their removal from the marketplace will increase consumer confidence, enable and encourage business growth and contribute to a vibrant UK economy.

Paul Ramsden, Deputy Chief Executive, Trading Standards Institute.