OFT publishes Annual Report 2010-11

[Legal Beagles]

The OFT has published its Annual Report for the last financial year alongside an estimate of the financial benefits of its activities to consumers.

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[Celestine]

Re: OFT publishes Annual Report 2010-11

OFT publishes Annual Report 2010-11


80/11 12 July 2011

The OFT today published its Annual Report for the last financial year alongside an estimate of the financial benefits of its activities to consumers.

The OFT focused on three key themes across its competition and consumer work during 2010-11 as summarised below. Achievements include:

High impact enforcement

A continued focus on high impact enforcement, including imposing fines totaling £225 million against certain tobacco manufacturers and retailers over unlawful retail pricing practices. Overall, fines of £254 million were imposed or agreed during the year.
Action in the credit industry to protect vulnerable consumers at risk of being exploited during the present economic uncertainty. This included securing a conviction against London Securities Limited for lending without a licence and warning 129 firms to become compliant with debt management guidelines or face losing their credit licences.
Consumer protection interventions including action against We Buy Any Car for unfair business practices, securing undertakings from certain postal gold firms that they would change their business terms and obtaining a ground-breaking High Court ruling that certain prize draw promotions breached the law.
Influencing and changing business and consumer behaviour

Undertaking work to promote compliance and help businesses, including reports on Drivers of Compliance with Competition Law and Consumer Law and Business Practice and setting up an online Sale-of-Goods hub to provide advice for retailers on consumers rights when buying goods. Furthermore, the OFT sought to raise consumer awareness through campaigns such as Scams Awareness Month, Know your Consumer Rights and Doorstep Selling.
Increasing transparency and innovation in our interventions through, for instance, piloting a one year trial of a Procedural Adjudicator to resolve procedural disputes in competition cases more efficiently.
Delivery and capability

Faster delivery of cases and projects, with more market studies launched and completed than in previous years, including those on terms in consumer contracts, mobility aids, equity underwriting and off-grid energy, amongst others. Additionally, 11 of our current 23 Competition or Enterprise Acts cases were opened in the last year.
The OFT also published its Positive Impact Report today. It estimates that it has saved consumers at least £326 million over the last three years, approximately seven times the cost of the organisation and during a period in which it has seen its budget reduce by over 15 per cent. This exceeds the five-to-one target set by HM Treasury.

Looking ahead, the OFT will continue its focus on high impact enforcement that delivers industry-wide compliance and also concentrate on issues that are important for economic growth. During this period of regime change, the OFT will engage with businesses, Government and other parties to secure the benefits for consumers and the economy of a strong and joined-up competition and consumer regime.

Philip Collins, OFT Chairman, said:

'The OFT has continued to focus on high impact enforcement that aims to stimulate economic growth and protect consumers during these uncertain economic times. In doing so we have sought to innovate and improve the way we work, such as through launching and finishing cases more quickly and being more transparent about our work.

'Looking forward, our work will continue to be underpinned with an integrated approach to the use of consumer and competition powers. We will also be actively engaging on how to best ensure that the UK continues to have a strong and effective competition and consumer regime into the future as proposals for reform are debated.'

NOTES

The Annual Report 2010-11 was laid before Parliament on 12 July 2011. It is available from the Annual Report page or from TSO, PO Box 29, Norwich NR3 1GN. Tel 0870 600 5522
Download the Positive Impact Report (pdf 289kb).
The OFT-HM Treasury performance framework agreement under CSR07 sets out that each annual report should provide quantitative evidence of how the OFT delivers direct financial benefits to consumers of at least five times that of its cost to the taxpayer across the spending review.

[EXC]

Re: OFT publishes Annual Report 2010-11

Improvements in the market already seen since
the OFT's study and test case began in 2007
include:

• unpaid item charges, levied when a bank
refuses to make a payment, falling from an
average of around £34 in 2007 to around £17
in 2010

• per transaction paid item charges, levied when
an unarranged overdraft is granted, falling from
an average of around £30 in 2007 to around
£22 in 2010

http://www.oft.gov.uk/shared_oft/ann...port-10-11.pdf



I really wish they wouldn't quote these figures.

On reading them you would reasonably conclude that consumers were now paying significantly less in unauthorised overdraft charges but that is not the case.

Nowadays the individual charges for paid and unpaid items are heavily supplemented by daily fees - which largely didn't exist until a few years ago.

And in fact the total revenue derived from unauthorised is almost the same as it was in the year that the OFT decided to undertake their UTCCR investigation - from figures supplied to us by the OFT under the Freedom of Information Act:

Revenue from Unarranged Overdraft Charges

2006 £2.54 billion
2007 £2.48 billion
2008 £2.76 billion
2009 £2.52 billion