Citizens Advice will replace the taxpayer-funded Consumer Focus group under Government plans to shake up the consumer protection system.
The changes will also see the end of the Office of Fair Trading, and the juggling of various roles and responsibilities between regulators and consumer groups.
The plans, which were announced by the Department for Business, Innovation and Skills today, will see the Citizens Advice service become "a champion for consumer information across a range of sectors".
- Plans announced to simplify consumer protection
- Government wants Citizens Advice to have a larger role
- New National Trading Standards Board also to be set up
The changes, which affect England, Scotland and Wales, will come into force over the next few years. They will "help streamline the consumer landscape" and provide "a powerful consumer voice", the Government claims.
Key changes taking place are:
- Citizens Advice: The charity will take on responsibilities and resources from both the Office of Fair Trading (OFT) and Consumer Focus. This includes taking over Consumer Focus' role of representing consumers' interests in unregulated sectors. This process has already started, and a new advice line succeeding Consumer Direct was launched by the Citizens Advice service on 2 April.
- National Trading Standards Board: A new National Trading Standards Board (NTSB) is to be created immediately, and this will be responsible for targeting rogue traders, internet scams, illegal money lending and other crimes that go beyond local authority boundaries.
- Regulated Industries Unit: A new Regulated Industries Unit will take over Consumer Focus's work in energy and postal services. This will be created by April 2013.
- The OFT: The Consumer Direct information service, previously run by the OFT, has been taken over by Citizens Advice. From April 2013 the OFT will begin to be merged with the Competition Commission to form the Competition and Markets Authority, which will be responsible for promoting competition in various markets. From April 2014 the OFT and the CC will no longer exist. Earlier this year the Treasury also announced proposals for a yet-to-be created Financial Conduct Authority to look after credit cards, loans, and overdrafts – a job currently done by the OFT.
- Consumer Focus: Consumer Focus will cease to exist after April 2014.
Consumer affairs minister Norman Lamb says: "For too long people have been faced with an array of different bodies for advice and support, but it's not always clear who to turn to first.
"The Citizens Advice service will become the publicly-funded voice of consumers, championing their needs and empowering them to make the right choices for themselves.
"There will also be clearer responsibilities and better co-ordination between enforcers and consumer bodies. A new National Trading Standards Board is exactly what we need to combat priority areas such as loan sharks and internet scams.
"All of the reforms will ensure that we have the right system of help, advice and protection for consumers."
Citizens Advice chief executive Gillian Guy says: "This is good news for consumers. With consumer advice, advocacy and education all under one Citizens Advice service roof, consumers will get a service they know and trust."
But consumer watchdog Which? is scathing about the change. It claims consumers will be left vulnerable to rip-offs and scams under the changes.
Which? chief executive Peter Vicary-Smith says: "This is a shockingly ill-conceived and under-resourced plan from the Government that looks set to vandalise a system of consumer protection that is admired worldwide at a time when people most need protection.
"Today the Government is giving with one hand and taking with the other. They seem intent on wasting millions of taxpayer pounds restructuring quangos and piling pressure on those who are already overstretched on the front line.
"Giving Office of Fair Trading responsibilities to local Trading Standards officers and the Citizens Advice is like asking GPs to carry out heart surgery."
Additional reporting by Helen Knapman.