Consumer Credit Act 2006

The Bill will update legislation relating to the licensing of consumer credit businesses and provide regulators with more proportionate enforcement powers; update controls on extortionate credit bargains with consumers being given better access to dispute resolution; and remove the financial limit below which regulation currently applies so that all consumer credit is regulated on the same level.

The existing Consumer Credit Act dates from 1974 and the issue of indebtedness, despite claims from retailers that consumer spending is slowing, is still a subject that continues to receive extensive attention.

In 2005 Lloyd’s TSB was singled out for criticism following a BBC television programme that revealed a £100,000 loan had been approved for a couple with a joint income of £5,000.

While the Bill completed its Commons stages during the 2004-05 session, there was insufficient time for it to be considered in the Lords before the general election.

The Bill’s origins lie in the December 2003 white paper, “Fair, Clear and Competitive - The Consumer Credit Market in the 21st Century” which advocated the strengthening of the rules governing credit licences; giving the Office of Fair Trading the power to fine moneylenders and conduct surprise raids on debt companies; the standardisation information when advertising financial products to ensure ease of comparison; and the setting out fairer rules for people who pay back loans early.

House of Commons

First reading: May 18 2005 (HC Bill 2)

Second reading: June 9 2005

Standing Committee D:

• 1st sitting: June 23 2005 (am)
• 2nd sitting: June 23 2005 (pm)
• 3rd sitting: June 28 2005 (am)
• 4th sitting: June 28 2005 (pm)
• The Bill as amended in committee (HC Bill 35)

Remaining stages: July 14 2005

House of Lords

First reading: July 19 2005 (HL Bill 18)

Second reading: October 24 2005

Committee stage:

• First sitting: November 8 2005
• Second sitting: November 16 2005

Report: January 18 2006

Third reading: March 21 2006

House of Commons

Consideration of Lords amendments

• March 29 2006
  

Royal Assent: March 30 2006