Consumers’ Institute is 21 years old — many successes, ‘more to do’
By
OLIVER RIDDELL
The Consumers' Institute reached its twentyfirst birthday this month, proud of its many achievements despite gagging writs, defamation actions, and restrictive laws of libel, sobered only by one “great failure’’ of communication which it hopes to put right over the next decade. The anniversary has been celebrated all over the country in “Consumer Week” rallies and meetings, bringing its work into closer touch with a public membership of 110,000 and recalling the influence it has had in business and commerce on the behalf of consumers since 1959. It is best known for its safety work: :: Lifejackets — investigation showed two were designed to help people drown rather than save them .: Motoimowers — some had mechanical and electrical faults, others cut off toes as well as grass. :: Folding prams and pushchairs —these caused five deaths and many close calls with their “mousetrap” action. :: Children’s car seats — seven brands were rejected on safety grounds. :: Casserole dishes with illegally high levels of cadmium. :: Hairdryers which burst into flame. :: Flammable nightwear which caused severe burns to children. :: A wax-filled storage
heater which caused several fires and explosions. “There is no excuse for producing goods that can injure or kill in order to make a profit,” says the Institute’s senior education officer, Mr R. W. Heenan. It has also found unsafe rider’s hats, toys, washing machines, and heaters. The Institute publishes a monthly magazine with test reports, research, and buying guides for its members. The articles in the magazine are often tendentious and sometimes vitriolic in their comments. They have at time caused the Institute considerable bother. In 1962, “Consumer” tested heaters, named them, and declared that three were hazardous and should be withdrawn from sale. (The Institute was sued by one company and
the jury failed to agree. Finally, the writ was dropped.)
:: In an article entitled “Meet the worst advertiser we have ever known,” the magazine named, not for the first time, “the deceitful, dishonest advertising” of a person “and his worthless and near-worth-less overpriced products.” :: In 1975, and again in 1978, the magazine warned consumers to keep away from a “loan shark” and his companies based in Auckland.
:: In 1980, it reported a case where a young oddjob man (named in the article) “ripped off” an elderly woman to the sum of more than $l4OO. But the Institute provides serices for all consumers, whether members or not. The main one is its Consumer Advisory
Service, giving advice and taking up complaints. Mr Heenan claims a 95 to 98 per cent success rate for this advisory service. The Institute also makes representation to Parliament and other Govenment agencies to have regulations changed and new laws introduced. It helped get the Small Claims Tribunal established and promoted the eventual Motor Vehicle Dealers Act. 1975. The effect of this legislation meant a buyer of a sec-ond-hand car had to be given a better warranty than was required for a buyer of a new car.
Other submissions in recent times have been on fruit, colour television, children’s nightwear, and bread. The Institute also provides consumer education for schools and has been influential in impro-ving-standards of advertising. It draws 60 per cent of its funds from public subscriptions and 40 per cent from various Government sources — the Treasury, Accident Compensation Commission, and Department of Health are the main ones. Its budget was $916,000 in 1978 and $1.104M in 1979; the 1980 budget has not been finalised.
In its early days, the Manufacturers’ Federation and Retailers’ Federation were very suspicious of the Institute. Now both organisations co-operate on matters of manufacture, design, safety and
methods of sale. Liaison with the Institute has helped the profitability and export sales of individual businesses. The Institute has worked with manufacturers and retailers over such problems as the terms of hire purchase establishing the Product Safety Council last year.
Its continued existence requires the Institute to be completely independent and impartial. It cannot accept advertising in its magazine and it is forbidden in the Consumer Council Act, 1966, to allow business to use any of its findings for advertising or promotion. The Institute will not accept money from any business although a business may subscribe to the magazine like individual members of the public. The last 21 years have not, however, been all success. To improve its image
the Institute is now concentrating on consumer education in the schools and has the agreement of the Department of Education that this work should be integrated into the existing curriculum. Many of the lower income group and less well educated do not know about the Institute and what it can do for them, or even trust it, Mr Heenan says. The Institute has failed to reach these people, yet they are the
very ones who stand to benefit most from its work. “Perhaps our greatest failure over the years is
that our resources did not allow us to do enough in pricing and trade practices matters,” says the director of the Institute, Mr Dick Smithies. “That is one of the big priorities as we enter our second 21 years — to stimulate price competition and attack restrictive trade practices.
“Another big task will be to test the products of the coming new technology. As products become more complex there will be a greater need for
an independent, impartial organisation to test and report on them.”
One of the institute’s most widely known successes in recent years came with the first introduction by the trading banks of plastic money — Visa and Bankcard. These were attacked fiercely by the Institute on a number of grounds. First, that they arrived in the mail to customers unsolicited, in breach of the provisions of the Unsolicted Goods and Services Act, 1975. Sending the first cards in this way made the customer rather than the bank responsible for destroyng them or accepting responsibility for them. Second, the Institute complained that they were
effectively “debit cards” rather than “credit cards,” no matter what name they were given. A debit card required immediate payment while a credit card can extend credit for up to 55 days. The Institute succeeded in changing both these aspects of the cards, but has so far failed to have the processing charge by tile banks on transactions through them reduced to the same low level as for processing cheques.
What of the future? Mr Heenan secs prices and trade practices, plus consumer protection, being the two main new areas in which the Institute will concentrate over the next decade. Both, he agrees are large and complex fields.
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Press, 15 July 1980, Page 17
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1,101Consumers’ Institute is 21 years old — many successes, ‘more to do’ Press, 15 July 1980, Page 17
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