Burnham takes on ‘rip-off’ discounts and subscriptions in cost of living push
Andy Burnham has vowed to outlaw fake discounts and crack down on stealth subscriptions as he pledges to deliver “breathing room” on the cost of living.
The Prime Minister has proposed to ban businesses from advertising “rip-off” discounts and said he will accelerate existing plans to make subscriptions easier to cancel.
These two pledges come as Burnham prepares to embark on a cost-of-living tour of the UK, where he will set out a series of “everyday fixes” which he claims will make Brits feel better off in the short term.
But some businesses which rely on subscriptions have criticised Burnham’s move to accelerate its crackdown on the payment model, which they said came without sufficient engagement with firms.
The Prime Minister said that Westminster “has got used to telling people that everyday hassles” like phoney discounts and subscription traps “are just a part of life”.
“I don’t think that’s right, especially when the cost of living continues to weigh heavily on so many people’s lives,” he said.
The government will ban retailers from making misleading claims about the value of its discounts, including fake reductions and misleading recommended retail prices.
This crackdown on “rip-off” discounting is expected to save British shoppers about £400m per year.
£1.6bn per year on ‘subscription traps’
Burnham has said he will speed up existing plans to force businesses to make subscriptions easier to cancel and to remind users more often about their payment plans.
Former Prime Minister Sir Keir Starmer had already set out plans to crack down on so-called subscription traps in April, but Burnham has said he will accelerate these policies to give struggling families “room to breathe”.
The measures will give consumers a 14-day cooling off period in which they can refund unwanted auto-renewals or roll-on fees.
Ministers said consumers will save an average of £14 per month thanks to these measures. Brits spend about £1.6bn per year on unwanted subscriptions, they said.
The News Media Association, which represents publishers including The Sun, The Times and The Guardian, said it was “deeply disappointed that the government has “rushed ahead” with this crackdown despite providing “repeated assurances about a proper implementation period”.
“Ultimately it is consumers who will be short-changed, as the businesses providing services enjoyed and relied upon by millions are left scrambling to adapt to an entirely arbitrary new deadline – diverting valuable resources that would otherwise go into building better products,” said News Media Association chief executive Theo Bamber.
Sue Davies, head of consumer rights policy at Which?, said: “It’s great news that the government intends to tighten up the law and explicitly ban misleading pricing practices, while putting an end to subscription traps.
“The government must implement these rules swiftly to give consumers much-needed protection against sneaky pricing tactics and hold businesses to account with tough enforcement, including fines, if they fall short.”
But Burnham has faced criticism that he is resorting to policies already proposed by his predecessor, rather than inventing new fixes to the cost of living crisis.
Shadow chancellor Mel Stride accused the Prime Minister of using “reheated” policy ideas and said he “has already run out of ideas”.
Burnham’s crackdown on rip-offs comes as part of a blitz of cost of living measures, including a £2 bus fare cap in England and abolishing VAT on household electricity bills.