UK watchdogs ‘must do more to protect consumers’
National Audit Office says major regulators must prove they are responding to rising prices and growing numbers of complaints
Major UK regulators need to prove they are doing more to protect customers amid rising prices and a growing number of complaints, the National Audit Office has concluded.
A report from the spending watchdog has claimed Ofwat, Ofgem, Ofcom and the Financial Conduct Authority (FCA) are poor at measuring their own performance and cannot prove they are “effectively responding to consumer concerns or offering enough protection for those who need it”.
The Daily Telegraph says “regulators have a statutory responsibility to protect customers by promoting competition, encouraging fair price, setting maximum prices where competition is insufficient, ensuring adequate services are delivered and preventing unfair practices”.
Ofwat, Ofgem, Ofcom and the FCA clocked up annual running costs of £855m in 2017, after UK consumers spent more than £140bn on bills in water, energy and telecoms, and fees and charges in financial services.
“The most common problems are found in handling debt from bills and credit as prices have risen sharply,” says The Independent.
Credit Strategy notes “affordability concerns play out differently in individual markets, but people who fall behind on their bills can often struggle across multiple services”.
The NAO, the independent parliamentary organisation responsible for auditing non-departmental public bodies, found customers often have difficulty in finding the most appropriate deals or services, meaning they pay more for the same service as new customers, amounting to an extra £4.1bn per year.
While the NAO has criticised major watchdogs for failing to provide clarity on their goals and lacking common standards, consumer groups have called for regulators to be given more teeth.
Caroline Normand, Which? director of advocacy, has called for more powers for regulators “to take on the might of powerful companies”, adding there was a severe lack of trust in some essential markets “because people don't believe their interests are being put first”.
This view is echoed by Labour shadow business secretary Rebecca Long Bailey who said “regulators have a limited ability to protect customer interests”.
“This is partly due to a lack of regulatory teeth, and partly due to the inherent contradictions in pitting the needs of bill payers against those of private companies looking to maximise profits,” she told the BBC. The MP added that a future Labour government would look to “fundamentally reform our regulatory system”, for example, by absorbing Ofwat into Defra to create a National Water Agency.