An independent Scotland would better serve households and business


  Consumers and business will be better served in an independent Scotland with a tailored scheme that protects their best interests and guards against unscrupulous traders, according to a new report.

Consumer Protection and Representation in an independent Scotland: Options outlines how a distinctive Scottish system would streamline the current cluttered and confusing approach to take account of Scottish needs, values and geography.

With powers to implement wide-reaching reforms, Scotland could take action to tackle issues which can cause stress and difficulties for families across the country:

  • pay day loans – we have outlined plans to cap interest rates, minimise loans continually rolling over, and improve market regulation to stop people getting trapped in a cycle of debt
  • delivery charges – Scottish households and businesses in rural areas are disproportionately affected by excessive charges. An independent Scotland would match the current postal service and allow greater choice and fairer prices
  • nuisance calling – we could give regulators more effective enforcement tools and sufficient penalties to deter rogue traders, while working with responsible companies to introduce codes of practice to protect customer data

The options for improvement include:

  • streamlining the confusing range of organisations who provide advice by setting up a recognisable brand to provide support
  • nationally – a unified consumer body to integrate consumer protection, advocacy, education, advice and enforcement for all sectors, similar to the work of the Northern Ireland Consumer Council
  • locally – community hubs could provide education and advice bringing together the services of Citizens Advice Bureaux, local authority advice and financial advice
  • creation of a Consumer Ombudsman to deal with complaints quickly (currently there’s over 95 ombudsmen schemes, operating across 35 sectors), potentially incorporating a financial ombudsman
  • or creation of a consumer ombudsman, and a separate Financial Services Ombudsman to merge the work of The Finance Ombudsman Service and the Pensions Ombudsman
  • creation of a consumer agency which would include a competition authority and be closely aligned with an economic regulator (bipartite model)
  • or three agencies covering economic regulation, competition regulation and a consumer agency, all closely aligned with each other (tripartite model)

The publication of the report comes 400 days ahead of the referendum on independence.

Finance Secretary John Swinney said: “When households and businesses access goods and services they need a system they can trust and that works in their best interests.

“As incomes are squeezed and costs continue to increase, it is even more important that we are protected from unscrupulous traders with those on low incomes, the elderly and the vulnerable particularly at risk of being exploited.

“Whether through the way we tackle nuisance calls, charges for parcel deliveries or the kind of financial loans available, the people of Scotland need a system that makes help easily available, offers practical solutions and has the power to make real changes where and when it needed.

“The Scottish Government currently does not have responsibility for arrangements to empower and protect consumers. With independence, we would be able to build a simpler system which meets the needs of our people, and puts families and households, small businesses and local communities at the heart of everything that it does.”

Richard Lloyd, Executive Director of Which?, said his organisation was pleased that people were being consulted:

“Which? welcomes the way the Scottish Government is consulting consumers in developing their proposals and looks forward to continuing to work closely with the Minister.

“In particular Which? is very much in favour of a Consumer Ombudsman to deal with all the complaints that currently fall outside the different existing schemes and leave consumers without the option of alternative dispute resolution in certain sectors, like travel.

“The availability of an effective redress mechanism can help to restore consumer trust in markets, as well as potentially driving up business standards and increasing competition. A Consumer Ombudsman could also help identify systemic failures that can be fixed before widespread mis-selling or other problems take root.’

William Kovacic, Global Competition Professor of Law and Policy, George Washington University and Commissioner and former Chair of the US Federal Trade Commission said:

“The discussion paper provides an excellent basis to create a state-of-the-art consumer protection system for Scotland. It is superb synthesis of experience at home and abroad. The paper shows how Scotland can ensure that consumer interests prevail in the increasingly complex and often daunting commercial marketplace.”