Are you really getting a bargain? The shopping tactics the UK Government wants to ban

Prime Minister Andy Burnham has unveiled plans to ease pressure on household budgets by making subscription cancellations simpler and requiring businesses to be transparent about automatic contract renewals.

The PM has announced new “easy to exit” rules that he says will help consumers cancel easily and prevent them from losing more money.

He wants to see an end to subscription traps, where people find it hard to cancel their subscriptions and contracts are automatically renewed at a higher cost.

The changes, announced in April under Sir Keir Starmer, had been expected to come into force next spring, but Burnham will bring their introduction forward to January.

Burnham also plans to ban retailers from making misleading claims to shoppers about discounts, which make savings look larger than they really are.

This would make it easier for the Competition and Markets Authority to punish firms that engage in practices such as artificially inflating prices and then immediately offering a “discount” to make a product look much better value than it is.

When they were announced in April, the UK Government said the plans would save consumers £400m a year in total, or up to £170 per person.

At the time, the Department for Business and Trade said there are 10 million unwanted, active subscriptions across the UK.

Burnham said; “I know people are sick and tired of rip-off discounts and subscription traps. Westminster has got used to telling people that everyday hassles like this are just 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. I’m determined to pull every single lever we can to provide people with some room to breathe on the cost of living.

“We’re putting an end to phoney bargains. If something is advertised as half price, it should actually be half price. We’re also making it as easy to leave a subscription as it is to join.

“These are just two of the everyday fixes we’re going to be rolling out – today is just the start. We want to put more money in people’s pockets and give people hope that politics really can work for them and their everyday lives.”

Burnham has promised a series of “everyday fixes” to help people with the cost of living and is planning a summer tour of the UK.

But opposition figures have criticised his plans as a “vanity tour” offering only “tinkering”, and urged him to implement broader tax cuts.

Shadow chancellor Sir Mel Stride said: “Andy Burnham has already run out of ideas.

“The cost of living didn’t become a problem last week, so you have to ask why it has taken Labour so long to enact legislation passed by the previous government.

“Labour’s tax hikes have sent costs soaring for hardworking families and destroyed jobs. Consultations and reheated measures won’t make up for that.”

The Scottish Government said Westminster needed to take immediate action to support people with living costs.

Public finance minister Hannah Mary Goodlad said: “We look forward to seeing more detail on this proposal, which was already announced by the previous UK Prime Minister.

“We must see more and stronger action from the UK Government on the cost of living crisis which is hurting people across Scotland. In particular, we need action to bring energy bills down – in an energy rich country like Scotland, nobody should be struggling to afford their bills.

“The Highlands and Islands of Scotland are a stark example of this – with fuel poverty remaining stubbornly higher in our rural and island communities despite hosting a large renewable footprint. The UK Government must use the powers at its disposal and take action to support people now.”

What are consumer groups saying about the announcement?

Dame Clare Moriarty, chief executive of Citizens Advice, welcomed the proposals, saying subscription traps and deceptive discounts were “a widespread problem”.

Citizens Advice has previously found 26% of UK adults had accidentally taken out a subscription in a single year, with the Government saying its action on subscriptions could save households £14 per month.

Sue Davies, head of consumer rights policy at Which?, also welcomed the announcement and called for the government to bring the rules in “swiftly”.

She said: “Which? has repeatedly exposed businesses, including trusted household brands, ripping off customers with dodgy deals that aren’t what they seem – but regulators have often found it too difficult to take action.

“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.”