Tag Archives | gift vouchers

Proposed 30 Day Refund Period is good for consumers – New Consumer Protection Legislation (3 of 5)

Department of Jobs, Enterprise and Innovation makes positive suggestion about automatic 30 day refund periodI wrote here last time (Consumer Protection Legislation – gift voucher proposals not worth the effort) out about my initial thoughts on the proposed consumer rights legislation put forward by Minister for Jobs, Enterprise and Innovation, Mr. Richard Bruton, TD in May 2015. As I said in that article, I’m not 100% convinced that the gift voucher proposals have any worthwhile merit apart from their headline grabbing capacity. These headlines are from around the time of the original announcement back then:

The proposals do, however, contain some other positive and far-reaching changes that would impact on the day-to-day purchasing activities of Irish consumers, yet it’s only the voucher changes that generate the column inches.

30 Day Refund Period

This proposal will provide for a a standard 30 day period in which consumers can return faulty goods and get a full refund or replacement – their own choice.

The current hazy legislation, an amalgam of different acts going as far back as 1893, provides for a remedy for consumers where products are not of “merchantable quality”. The remedy from the retailer can be a choice of “refund, repair, replace”, but the chosen remedy is left to the retailer to decide, rather than the consumer.

It is claimed further that if enacted, these proposals would more clearly define for all concerned what the expected standard of “satisfactory quality” purchased goods would have to meet. Apparently, the Supreme Court has described the standard of “merchantable quality” as “archaic and somewhat mysterious” – something that most consumers who have tried to return faulty goods will confirm.

The definition, however, of a standard 30 day period after purchase within which consumers would have the right to themselves choose their own remedy having purchased goods that turn out to be faulty, or not of “satisfactory quality” is likely to have the greatest benefit for consumers.

Retailer Push Back

And, as mentioned previously, it’s also, probably, going to cause the biggest push-back from retailers as well. Now, instead of it being up to the retailer to decide the remedy, the consumers will decide.

Let’s face it: the current situation is a complete joke when it comes to protecting the consumer. The existing legislation provides for retailers to run through the following (possibly somewhat cynically presented) steps to avoid having to deal with consumers and their defective purchases:

  • Plan A – They’ll firstly do anything possible to do nothing at all, including ignoring complaints, insisting that the product isn’t actually broken, insisting that consumers deal instead with the manufacturer, incorrectly insist on receipt as only proof of purchase, or even insist that their returns policy doesn’t apply in this case.
  • Plan B – When confronted with having to do something, they’ll almost always plump for the “repair” option rather than replace or refund. The repair will take weeks, frequently without a like for like replacement product in the meantime. Frequently, the first repair won’t be successful and so is followed by a longer repair period, trying desperately to bring the consumer to the point of giving up.

It has been my experience, as it has I’m sure with many others, that actually getting a retailer to commit to a refund or replacement is far harder work for a consumer than it ever should be.

Hopefully, this new proposal – if it does go ahead – will vastly improve the consumer experience for many of us.

Problems – I see a couple

Unfortunately, outside of this new 30 day limit, the options seem to remain relatively hazy. The Department press release indicates that outside the 30 day limit, consumers have the right to repair or replacement, and if repairs after “a reasonable time” are still unsuccessful, then the consumer is entitled to a price reduction (to keep the item), or a return the funds to get a full refund.

Who gets to define “a reasonable time”? Is 4 weeks a reasonable time to fix a mobile phone, for example, if Samsung can actually ship 2 ½ million phones each day in that period?

The passage of time is a problem within the currently legislation, and outside of the initial 30 day period, this new legislation doesn’t seem to improve on the current situation.

Additionally, a new “out” is now available to retailers to try to frustrate the consumer getting to their normally ultimate aim of a full refund and return of the item.

Therefore, it will be interesting to see how this “out” – the proposed new “price reduction” option will work out. How faulty does a product need to be for this option to NOT kick in? And if it’s partially faulty, how partial will the refund be?

Back to the phone analogy, if a smartphone won’t access the internet, but makes calls, would this entitle the consumer to a 20% discount or an 80% discount (shouldn’t it be 80% given that internet access on a smartphone is now vital?).

In my next blog post, I’ll look in more detail at the proposals around the provision of information to consumers, and their rights to receive certain information in certain situations.

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Gift voucher proposals not worth the effort – New Consumer Protection Legislation (2 of 5)

Department of Jobs, Enterprise and Innovation has proposed some useless changes to consumer legislation around vouchersIn my summary blog post recently (Consumer Protection Legislation – some good but some pointless changes proposed) about the May 2015 announcement of some extensive changes to consumer rights legislation announced by Minister for Jobs, Enterprise and Innovation, Mr. Richard Bruton, TD, I noted that I expected that the greatest impact for consumers would be those impacting gift vouchers and the 30 day refund period for faulty products.

And not by accident, those changes would likely have the biggest impact on retailers, endangering their enactment at all.

30 Day Refund

For me, of most interest proposal which will provide for a standard 30 day period in which consumers can return faulty goods and get a full refund. This would be huge for consumers if it was to be enacted – the current hazy legislation regarding “refund, repair, replace” which leaves it down to the retailer to decide which remedy to apply, and over an undetermined time period, is probably one of the biggest bugbears and cause for confusion among consumers.

It will be interesting to see if this does go through as it likely to be rigorously opposed by retailers who hide behind the existing repair / replace options within consumer legislation to ensure they never have to return money to consumers for crappy products.

It is likely also to generate some comic conversations where within 30 days of purchase, retailers will try to justify how a clearly broken product is in fact operating exactly as it should.

Your smartphone won’t connect to the mobile network? Well, that’s the new thing – this is actually really supposed to be viewed as a Wi-Fi phone. Yes, that’s right, there are the Wi-Fi tablets already, so obviously the next step is Wi-Fi phones.

Developments and progress towards implementing the proposals here, and whether or not they’ll eventually be watered down before passing into law, will be worth monitoring.

Rights by Proxy

The new proposals includes somewhat innovative clause that would allow consumers who receive products or services as a gift be entitled to the same rights as if they bought the product or service themselves.

When I say innovative, maybe I should have said “makey uppey”. I’ve no legal background but I’m not sure that creating such a right by proxy would be very easily achieved.

More importantly, I’m not sure we really need such a new right to be provided to gift recipients. Existing consumer rights can handle such scenarios perfectly well without providing such rights by proxy.

Gift Voucher Changes

As I mentioned in my original blog post, I think these are mainly included in the proposals for their headline grabbing capacity, and the proposal is largely futile in its wish to ban expiry dates for gift cards and vouchers.

Regular readers here will know that I’m not a fan of gift cards and vouchers. You can read here my thoughts on why you should avoid gifts vouchers and instead, gifts could and should be much better thought out rather than plumping for the gift voucher catch-all.

I accept that, yes, this new legislation will remove the danger of voucher expiry from that list of dangers, but many other will still remain – and many cannot be mitigated through legislation.

Buyer should still always beware

The Irish Examiner Survey Says 46% of consumers don't check voucher termsAs in most things, the first line of protection for the consumer is the consumer themselves – which was always the case anyway when it came to expired vouchers. This article from the Irish Examiner [Survey: 46% do not check gift card conditions] highlights research carried out on behalf of the National Consumer Agency (NCA) [now the Competition & Consumer Protection Commission (CPCC)] which indicates that almost half of people receiving vouchers or gift cards as Christmas presents do not check the conditions of use.

Worse, consumers in many cases won’t even use their gift vouchers, never mind read the terms and conditions. According to estimates in this US article [1$billion in gift cards goes unredeemed], at least in 2007 up to 10% of all gift vouchers purchased were never redeemed. Whereas this article [Half of us have left gift vouchers expire] tells us that further National Consumer Agency (NCA) research has found that 48% of Irish people let gift vouchers and cards expire.

If consumers in general were to read the terms and conditions of their vouchers, and were to actually follow up and spend those vouchers in a timely manner, then we’d have no need for this legislation. In fact, in this view, even the vice-chairman of the Consumers Association of Ireland (Mr. Michael Kilcoyne) and myself are in agreement. In a recent article, Mr. Kilcoyne is quoted as saying:

But all the legislation in the world is no use if we, as consumers, don’t shop around and get the best deal for ourselves.

Rare wise and useful words. Next up, I’ll write a little more on what I think would be potentially the most beneficial proposal for Irish consumers – the automatic right to a refund within 30 days of purchase for faulty products.

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Some good but some pointless changes proposed – New Consumer Protection Legislation (1 of 5)

Department of Jobs, Enterprise and Innovation has proposed new consumer protection legislation changes (logo)Back in May 2015, some extensive changes to consumer protection rights legislation were announced by Minister for Jobs, Enterprise and Innovation, Mr. Richard Bruton, TD. Given the usual legislative delays plus the interjection of an election, the proposals haven’t progressed into law yet, but should they be, there are some interesting implications for consumers – some positive, some negative and some downright meaningless.

Some of these proposed changes have received more media coverage than others – particularly those instituting some rules for the issuing of vouchers and gift cards – including some significant coverage over the Christmas period.  For the record, I’ve frequently written here on the evil that is buying vouchers as gifts, or at all – see here my listing of reasons not to buy vouchers for any reason, so if these proposals didn’t ban vouchers completely, I’m probably not inclined to be interested.

But I’ll come back to vouchers later. In the coming days, I’ll publish my thoughts on a few sections of the proposed legislation, including a post highlighting what I think is a major gap that I think could, or should, have been addressed, but wasn’t.

Obviously, the potential for a change in government (particularly now that it’s not even definite that Fine Gael will continue to be the main players in the relevant Department) could mean that these proposals might not go through in their current form. Though, it’s worth noting that the 2011 change in government didn’t impact on the Fianna Fail plans to merge the Competition Authority and the National Consumer Agency into the Competition and Consumer Protection Commission, even though such a proposal was never previously on the cards for Fine Gael or Labour.

What might change?

In summary, the changes proposed in this legislation are as follows:

  • Expiry dates on gift vouchers and gift cards will be banned
  • Consumers who receive products or services as a gift will be entitled to the same rights as if they bought the product or service themselves
  • Consumers will get a standard 30-day period during which they will have the right to return a faulty product and get a full refund, without going through the repair / replace shenanigans
  • Consumers downloading or streamlining digital content will now receive statutory rights, similar to what they receive when buying physical items
  • Consumers purchasing services will have their rights strengthened, such as now receiving the right to a repair or a refund for crappy service
  • Consumers of certain services (healthcare, social services, gambling) will now be entitled to additional information regarding transactions they undertake – e.g. GP pricelists.

Summary Conclusions

In short, it’s my opinion that the gift vouchers changes are merely there for their headline grabbing appeal. It’s one of those consumer laws being brought in to protect people who can’t be bothered looking after themselves.

I don’t know enough to comment on how necessary the additional statutory rights for online downloads were, but I do think the changes with regards to strengthening consumer rights when purchasing services is to be welcomed, though is likely to prove very problematic for consumers to actually benefit from those particular changes. The key sticking point here is likely to be how a substandard service is defined / identified / proven.

Importantly, while the automatic 30-day refund period for faulty products could probably have the biggest impact on making consumers purchasing experiences significantly better, it is also likely to be opposed most rigorously by retailers who hide behind the existing repair / replace options within consumer legislation to ensure they never have to return money to consumers for crappy products.

Finally, I do see one glaring gap right now in the information rights proposals for the new legislation. I can’t argue with proposals such as requiring GPs to hang price lists on the wall. Though, in the interests of consumers looking after themselves – have we lost the ability to ask up front what the charges would be?

First up then, in my next blog post I’ll look more at the 30 day refund rule, the “consumer rights by proxy” for recipients of gifts, and the voucher / gift card changes.

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The “new” HMV is honouring vouchers from the “old” HMV. What should you do next?

Run, as fast as you can, into your nearest HMV and spend them all. Get rid of them as quickly as you can. If you still have HMV vouchers, you’re extremely lucky that the new HMV are doing this – they’re not obliged to do this at all.

Though, one wonders if there isn’t all that many vouchers outstanding that haven’t been ripped up. It’s a nice gesture, but businesses don’t normally go for nice gestures if it’s likely to cost them a lot of money. I haven’t seen any of the newspaper coverage of this story actually ask the question as to what value of vouchers is outstanding.

Anyway, what should you do now?

  1. Spend any vouchers that you have as soon as you possibly can
  2. Search your house high and low for any other vouchers you have, gather them all together and spend them as well
  3. Learn your lesson from the HMV debacle and don’t buy any more vouchers – for yourself or for anyone else – and if you do receive vouchers as gifts, spend them as soon as you get them

Vouchers are evil – particularly so these days given the perilous state of many businesses, so you could lose your money. They’re also a really lazy present and could cause the recipient of your present to lose out as well.

Finally, click here to read plenty more reasons why vouchers are so evil and should be avoided.

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Don’t get involved in Christmas Clubs – your money is at risk

I’ve noticed a large number of stores have been advertising their Christmas clubs already – we’re only just into November.

While a Christmas club may sound all nice and positive and you may think you’re doing something good in preparing for Christmas, you should be aware of the dangers of getting involved in Christmas clubs.

When you sign up to one of these clubs, or something like “lay away”, you are giving away your money to a business who is not giving you anything in return – not in the short term.

You’re on a promise to get something closer to Christmas when your pot of money builds up, but if the business fails between now and then, you’re going to be left high and dry without your money.

A Christmas club, or lay away, is effectively like getting involved in vouchers and gift tokens – you’re giving an interest free loan to someone who’s giving you no guarantee that they’ll pay you back. While they may offer you some enticement to get involved, there’s a greater risk these days as business are closing every week.

If you are, encouragingly, saving for Christmas, at least used an institution where your money is protected – a bank, building society or your credit union.

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Another reason not to get involved with gift vouchers – I’m losing count now

One of the more popular pages on this site is my constantly updated feature on reasons not to get involved in using gift vouchers – you can see the latest update here.

An oldish story in the Irish Times further highlights that recommendation – Consumers warned to redeem gift vouchers without delay.

The story refers to the policy of the then “about to close down” Hughes & Hughes to not honour any outstanding gift vouchers in the run up to their closing.

All you can say really is what complete and utter scumbags they are – seeing actions like this you’d have to say “no loss” to their closing down if that’s the way they’re going to do business.

Yes, yes, I know that circumstances were different then with their running out of money and shutting down, but in fairness, if that kind of stunt is symptomatic of how they normally ran their business, then we’re better off without them.

Still though, despite the bleating from the Consumers Association of Ireland (we haven’t heard from them in a while) and the National Consumer Agency, Hughes & Hughes were completely within their rights to do this as they had probably catered for it in the terms and conditions of using (or not using) their vouchers.

According to the article, the CAI had the following potentially misleading, and ultimately pointless comment to make:

Consumer Association of Ireland (CAI) chief executive Dermott Jewell said it was “not acceptable” for Hughes Hughes not to redeem the book token while branches were still open. “The consumer holding the voucher would have a contract with that company as long as it is still trading.”

A contract, yes, where there are terms and conditions in place which the consumer would have signed up to by getting involved in the vouchers in the first place.

Maria Hurley from the NCA, apparently echoing someone from the receivers, Deloitte, at least had the factual – if not altogether helpful for the consumer – comments to make:

A company which goes into receivership does not have to honour gift vouchers, even if stores are still open. After a receiver is appointed, he or she is responsible for all subsequent decisions affecting the business, including whether gift vouchers are honoured, she explained.

I’ve said it before. I’ll say it again. In this current environment where you don’t know which businesses are ultimately going to survive, stay away from vouchers, credit notes, lay aways and even deposits – basically any situation where you give money up front to a business in expectation of a future delivery of a product or service.

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Reasons not to buy vouchers – Updated

Before Christmas last year, I wrote an article that got a lot of attention called “5 Reasons not to give Vouchers this Christmas“. That post was subsequently updated to become 6 reasons after a PriceWatch reader highlighted a new issue discovered with vouchers in January.

Based on a few e-mails I’ve received since the original article with problems discovered by ValueIreland.com readers, this listing is now updated again below:

  • It is always be a nicer touch to put a bit of thought into a present for someone rather than the somewhat lazy voucher option.
  • Some generic voucher schemes might not be redeemable in as many stores as you expect, or as many stores as the recipient might actually want. There’s nothing worse than getting a voucher for somewhere you’ve no interest in buying something.
  • Certain vouchers that you might think are a good idea (such as Ryanair for example) are reputed to be very difficult to actually cash in – and in some cases have cost more to use than the value of the gift itself.
  • Some vouchers have an expiry date which makes them useless once passed. While it’s not your fault as the “giver”, it could mean that the receiver is under pressure to use the vouchers before they expire. They might end up using them on something they don’t really want that much.
  • Sometimes, if you buy a voucher from a proper shop outlet, it might not be usable in a concession version of the same shop. This was illustrated through the experience of a reader of Pricewatch in the Irish Times. This issue, however, could have been seen in the terms & conditions, if they’d been read beforehand.
  • Depending on where you’re based, or the person you’re buying the voucher for lives, you must remember that in most circumstances, if you buy a voucher for a chain here in Ireland, you won’t actually be able to use that voucher in the same chain in Northern Ireland – or vice versa.
  • The One 4 All SmartPlanner vouchers should definitely be avoided. Despite several questions as to where the company keeps the money paid up by “members” before Christmas, they won’t tell me. That leads me to suspect that the money is held by the company and not in trust for the “members”. Click here to read why this is a problem for consumers.
  • And finally, and most importantly, In the current economic climate, if you buy vouchers from a business that closes down in the new year, the vouchers will most likely be worthless depending on how badly strapped for cash the shop is when it shuts.
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Don’t give companies free money if you don’t have to!

We’ve written many times that as much as possible you shouldn’t be giving companies interest free loans in the form of buying gift vouchers from them.

A couple of weeks ago we also pointed out the danger of the suggestion from the Consumers Association of Ireland Chairman that we start to avail of “lay away” facilities that might be provided by some retailers.

We also mentioned that you should think twice before getting involved in savings schemes facilitated by some retailers – particularly Christmas Clubs.

In all these scenarios, you’re basically giving your money to retailers in return for the promise that they’ll provide something at some date in the future. You’re basically providing them with an interest free loan until the time that they have to provide the good or service in the future.

And if that business were to close down in the meantime, you’re likely to lose all of your money. You’ll be know as an “unsecured creditor” – if the banks and other creditors and lenders get their money back, then you’d get yours. But that’d be very unlikely.

It’s good to see, though, that the National Consumer Agency are starting to get in on this – warning people of the dangers of deposits.

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Why this country will continue to struggle for a while more

This article was in the Irish Independent last week. It details how a Dell employee who will soon lose his job is about to lose his wedding reception deposit paid to the Castletroy Park Hotel because they’re closing down. This article from last weeks Sunday Times has a similar story related to Kinnitty Castle – it details a warning from the National Consumer Agency that couples planning on getting married could risk losing their deposits if hotels close down before the reception is held.

In the same way as we’ve warned against gift vouchers, savings clubs, Christmas Clubs and lay aways, giving deposits to businesses can be a risky proposition these days. In all these situations, you’re giving a business you’re money without actually getting something in return – at least for a while anyway. And in each of these situations, as an unsecured creditor, you’re likely to be the last person to get your money back – if at all.

However, that’s not the reason for my post. This statement at the end of the article is:

I’m working in Dell and still have a wedding to pay for.

This is from the main character of the story who confirmed that he was due to lose his job next January. The average wedding in Ireland costs upwards on €40,000. And the maximum payout, I understand, from Dell will be 1 year of salary. Around the same amount maybe?

Why the hell would you go ahead with paying for a wedding when you’re unlikely to have a job? I realise it’s what many couples would like, but if you’re future is uncertain, and you’re living somewhere that’s taking a huge hit on job losses recently, maybe there should be some second thoughts about spending the money?

But that’s not been the Irish way for the past number of years. We don’t care where the money comes from (ours or the banks) as long as we can spend it on exactly what we want, whenever we want.

This statement shows that that attitude isn’t changing all that quickly despite everything that’s happening at the moment.

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I can’t vouch for tokens

Irish News of the World
February 1st, 2009
Diarmuid MacShane

Don’t give away your money for nothing

ValueIreland.com has always advised that you should avoid buying vouchers as gifts. By doing this, you’re basically giving a shop your own money as an interest free loan. They can then keep that until someone tries to use the voucher in the future.

There are too many potential problems that can make them not worth the hassle. These can include expiration dates after which the vouchers could become useless and some vouchers that have terms and conditions that might make them almost impossible to use.

The main risk these days is that shops are closing down – such as Zavvi and Land of Leather after Christmas. Others are at risk of closing down soon. If you have vouchers for a shop that goes out of business you become what is known as an “unsecured creditor”. This basically means you’d be the last person to get your money back once the banks and any other creditors are paid back. “Unsecured creditors” rarely get their money back though!

Other ways in which you could end up as an “unsecured creditor” would be if sign up for the Christmas Clubs advertised by some stores as a way of saving, or buy buying the savings stamps that you now see in many larger stores – grocery stores in particular.

Another risky way of buying something is on “lay away”. This is where you pay a store an amount of money every week or month, and at the end, you get the item you’re buying.

In all of these situations, you’re giving a business your money and actually getting nothing in return. They’re minding your money for you, with the risk of you not getting it back. Why take the risk of losing your money if the shop was to unfortunately close down when your money may very well disappear? Find a savings account with your bank or credit union where it’ll be a whole lot safer.

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