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OFT launches 'Save Xmas' campaign following Farepak collapse

79/07    1 June 2007

Following the collapse of the Farepak hamper company last year, the OFT has today launched a campaign to help consumers decide how best to ensure they can afford to pay for Christmas.

The OFT was asked to carry out an awareness programme to help consumers understand their options when saving for Christmas by HM Treasury. The programme will include working with community groups and partners across the UK to explain what options are available when saving for Christmas this year - and in the future at grass roots level.

The OFT 'Save Xmas' campaign was launched today by TV presenter Charlie Dimmock, and supported by dozens of victims of the Farepak collapse who attended the event.

John Fingleton, OFT Chief Executive, said:

'The OFT welcomes the opportunity to help consumers understand the full range of options available when putting money away in the short term. The collapse of Farepak when thousands of families lost money at a critical time, shows how important these decisions are for many consumers. The bulk of our work in this campaign will involve working with community groups on the ground to increase people's knowledge and skills about their choices.'

Teresa Perchard, Director of Policy, Citizens Advice, said:

'We really welcome this campaign and are pleased that the Government wants to raise awareness about saving for Christmas. We want to ensure that people who are saving up for Christmas know which forms of saving protect consumers' money and which do not. The Citizens Advice service helped many people who were affected by the Farepak collapse last year and saw the financial hardship it caused thousands of families. We are committed to working in partnership with the OFT to make this campaign a success and get these vital messages across to as many people as possible.'

NOTES

1. Shortly after the collapse of Farepak last year, DTI Minister for Trade Ian McCartney requested that the OFT in conjunction with the FSA, provide him with advice on the options to address the issues arising from the situation. Download the advice.  

2. In November 2006, the Economic Secretary asked Brian Pomeroy, Chairman of the Financial Inclusion Taskforce, to investigate the Christmas savings market to look at the reasons why people opt to use hamper schemes and similar vehicles instead of mainstream financial services products and, in the light of this, to consider how the savings needs of this group of consumers might be better met.

3. Pomeroy Report and the Government response was published on 28 March 2007. The Pomeroy report recommended that in view of the uncertainty that has been caused over Christmas savings schemes, and the risk that this may prevent people who would otherwise have saved for Christmas from doing so, the Government should consider mounting a specific campaign to make consumers aware of their options. The Government's response to this specific recommendation was to announce; a £1 million funding for the Office of Fair Trading to conduct a consumer awareness campaign in the coming months on Christmas saving schemes and mainstream alternatives.

4. Photographs of the launch and interviews are available. For more details contact the OFT press office.

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