Mar 15, 2010

In consumers’ interest

By Dr Arif Azad

World Consumer Rights Day is celebrated on every year on March 15 — the day when the US President, John F Kennedy, articulated a vision of four basic consumer rights in 1962. These four basic consumer rights, incorporated in the consumer bill of rights, included the right to be informed, the right to safety, the right to be heard, and the right to choose.

Since that year, consumer movement has taken off the world over. In the US, in particular, the achievements of consumer movements have been significant due to high-profile consumer activism by Ralph Nader whose name is indelibly linked to advancement of consumer agenda.

Ralph Nader’s singular achievement was to embed the notion of consumer power in political and policy discourse. As a result, consumer agenda has inched its way to governmental and international law. In 1985, the UN also got in on the consumer agenda by adopting guidelines on consumer protection.

The UN guideline on consumer protection, further fine tuned in 1999, obligate the signatory countries — Pakistan is among the signatories — to put in place mechanisms for enhanced consumer protection, consumer education and encouragement of consumer groups.

These guidelines stretch basic consumer right to eight which include: the right to basic needs; the right to safety; right to be informed; the right to choose; the right to be heard; the right to redress; the right to healthy environment and the right to consumer education.

With this, we have a whole panoply of precedents and guidelines to protect consumers from a wide spectrum of depredation which unrestrained capitalism reeks upon consumers. Cumulatively, these measures provided a constant fillip to the formation of Consumer International (CI) which has emerged as the leading international consumer organisation with membership drawn from consumer organisations world wide. It was CI that led the expansion of consumer rights from 4 to 8 which were later on adopted by the UN guidelines on consumer protection. This year CI also turns 50, signifying the coming of age of world consumer movement.

In Pakistan, the concept of consumer rights, though a new one, has been catching on. This is reflected in many consumer groups springing up with the Network for Consumer protection being the first NGO in the country set up in 1991. Over the years since then the consumer movement has made considerable gains. From 1990s consumer protection acts have been framed, with consumer courts functioning in 11 districts.

Though the case law on consumer issues is still puny as compared to other countries, yet judicial activism of some judges on consumer courts is already showing results. Further, in line with growing consumer awareness, many governmental organisations have set up consumer complaint and redressal system to address consumer demands. This so far has been the credit side.

On the debit side, a lot more remains to be done. Despite these baby steps, consumer voice has not cohesively attained to the critical mass where it can impact policy and political worlds. Consumer interest remains unorganised as compared to organised interests. Sugar crisis furnishes the best example where consumers remain hard done by organised sugar cartels.

In the sugar case, government has failed to encourage fair competition which allows greater consumer choice. Competition Commission of Pakistan (CCP) charged with staunching anti-competitive business practices which impinge on consumer choice is being further whittled down and kept under constant threat of being folded. This is singularly bad news for consumer choice.

As is the case of sugar, consumer-unfriendly tenor runs through other regulatory instruments that govern food and water safety, patient safety from harmful drugs and negligent doctors. To add insult to injury, not a day passes when sky-high increases in utilities or food bills are not sprung upon hapless consumers without any compensatory redressal or protection instruments in place.

From food to medicine — the list in between the two items is exhaustive — there is an open season on distressed consumers. Amidst all this, political parties have hardly articulated consumer aspirations either in their political manifestos or political platforms or in the parliament. This is all the more glaring since every consumer doubles up as a citizen; and citizenship and consumer rights are inextricably linked. Exercising one’s consumer rights is exercising citizenship rights at bottom. Political parties can deny this linkage to their own peril if democracy and good governance have to take root.

This year’s world consumer day is aptly themed as ‘our money, our rights’ which has assumed immense salience against the backdrop of global financial crisis. ‘Our money, our rights’ seeks to address the issue of consumer rights and protection from unrestrained operation of financial industry. The recent global financial crisis has spotlighted the vulnerability of consumer against rapacious banking system. Thousands of people in countries affected by financial crisis the most have lost their homes, bank deposits and defaulted on mortagages payments in the absence of robust consumer protection policies in place.

In the US, which has suffered grievously from the crisis, a strident chorus is forming for the need of consumer protection from financial industry. Responding to these deeply felt popular demands, the US president, Barrack Obama, has promised the introduction of consumer financial protection agency despite resistance from powerful financial institutions. Pakistani consumer too has long been the victim of financial scams. The big scandal of finance corporations of the 70s and 80 still rankles in the memory of ordinary people, who had deposited their saving in the hope of better returns, ending up in penury, with the government financial regularly regime fatally exposed.

Against this backdrop, with banking sector and financial services industry taking off in a big way in Pakistan, there has never been a rock-solid case for bringing in legislation to protect consumer from the rapaciousness of financial industry. Consumer organisations can play a vital role in educating consumer in reading between the lines of small print of banking contracts as a first step. ‘Our money, our rights’ is only the beginning of a long uphill struggle for consumer rights in relation to financial industry in today’s world.

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