Consultations launch on plans to ensure clear pricing to consumers

The Department for Business and Trade (DBT) is launching a number of consultations on proposed measures to boost transparency and fairness to consumers, particularly over pricing.

Among the consultations being launched, the government is considering stronger measures to tackle ‘drip pricing’ where additional extra fees are added to the price paid at checkout. Government research commissioned earlier this year found the practice is widespread, and practiced by more than half of businesses in the entertainment (54%) and hospitality (56%) industries, and by nearly three-quarters of transport and communications businesses (72%). In total, UK consumers are estimated to spend an additional £1.6 billion online each year on these additional fees that are often not clearly advertised.

Proposals from the DBT also include reform to the Price Marking Order (PMO), which requires traders to display the final selling price and final unit price (e.g. price per litre) of products in a clear way. Changes seek to ensure consistency about how unit pricing is applied, including for products on special offers and promotions to make it easier for consumers to compare the value for money of items.

A third consultation will continue the government’s efforts to tackle fake product reviews posted online, previously announced in the Digital Markets, Competition and Consumers Bill (DMCC) currently progressing through Parliament.

Minister for Enterprise, Markets and Small Business Kevin Hollinrake said:

“Today’s measures will help people keep hold of their hard-earned cash and ensure they have the clearest and most accurate information upfront before they make a purchase.

“From the shelves of supermarkets to digital trolleys, modern-day shopping provides a great wealth of choice. But fake reviews and hidden fees can make those choices increasingly confusing and leaves customers unsure about what product is right for them.

“We’ll be listening to industry to ensure these new regulations work for businesses too and don’t generate unnecessary burdens, while at the same time providing a crucial safety net for consumers and their cash.”

The consultations on changes being proposed have been welcomed by groups representing both consumers and retailers.

Sarah Cardell, CEO of the Competition and Markets Authority (CMA) said:

“This consultation follows recommendations from the CMA to government to tighten the rules on how everyday items are priced on supermarket shelves as well as our work tackling fake reviews online.

“We’re very pleased to see this getting underway and it’s an important step toward clearer rules and greater transparency for people when shopping around for goods and services.”

Rocio Concha, Which? Director of Policy and Advocacy said:

“The measures being consulted on will address longstanding concerns to help consumers make better informed decisions – whether shopping for products online or buying a weekly shop in the supermarket. Our research shows that fake reviews jeopardise consumer trust and are harmful to honest businesses that don’t purchase or incentivise people to post positive reviews.”

Graham Wynn, Assistant Director for Consumer Policy at the British Retail Consortium said:

“The BRC fully supports practical, proportionate consumer protection measures and the level playing field they bring. It is important to keep the rules up to date to reflect changes in buying and selling methods. We look forward to engaging constructively on the proposals.”