Could a government-led consumer strategy smarten up our essential services?

Houses of Parliament

Today marks Theresa May’s first 100 days as Prime Minister. And while we’ve heard some positive things from her new government about prioritising consumer interests, we think what’s needed is a comprehensive consumer strategy to smarten up essential services.

From our research and from what you’ve been telling us, it’s clear that several essential markets in the UK aren’t working effectively enough for you.

If we’re to see an end to the mis-selling scandals and poor customer service that have blighted markets, such as energy, banking, telecoms and rail, over the past 10 years, then corporate culture needs an overhaul.

Consumer strategy

A cross-cutting government consumer strategy would promote competition, while protecting us when we’re at risk. Action could be focused on essential regulated markets, such as energy, banking, broadband and transport.

These are markets where we know (because you tell us so) you frequently face significant costs and where poor customer service is rife.

And, as the government starts negotiations to leave the European Union, the consumer strategy would put you right at the heart of them. It would safeguard the most important consumer rights in EU law and remove regulations that aren’t in your interest.

So what practical steps should the government take in these sectors this autumn? Well, here are our suggestions:

Energy
We’ve long been campaigning for a fairer energy market. This autumn and winter, Energy suppliers should take responsibility for engaging customers stuck on expensive gas and electricity tariffs and demonstrate that they’re going the extra mile to ensure they get a better deal.

Banking
Earlier this year, Which? revealed that unarranged overdraft fees can be much higher than the cost of a payday loan – punitive charges that are really taking their toll on far too many people. While payday loans have now had their charges capped, the cost for unarranged overdraft fees hasn’t been challenged.

To add insult to injury, in 2014, banks made £1.2bn from these charges, yet the competition authorities failed to address this issue as part of its banking inquiry. A consumer strategy should require the Financial Conduct Authority [FCA] to review these sneaky fees as soon as possible.


Broadband
Access to reliable, high-speed broadband is essential for enabling people to participate in the wider economy.

Far too many of you feel frustrated by lacking internet connection, people like John Vincent, who told us:

I live about three miles from a major city, yet we were without our internet connection for a week, and our phone line for two weeks (I run a small business from home, so this makes it really difficult).

The government needs to press ahead with its plans to ensure that people are automatically compensated for broadband service failures, putting the sector in line with the water and energy sectors.

Britain cannot duck the importance of creating and maintaining a modern communications network. The government must ensure its Universal Service Obligation for broadband is delivered cost effectively and that people are able to easily apply for a connection. A consumer strategy would deliver on this agenda and ensure that the level of service people receive from Openreach improves.

Train travel
Far too many rail passengers are being let down every single day, either enduring miserable train journeys or finding it impossible to get the right fare. Rail passengers deserve better. Action is required this autumn to help passengers to find the best priced ticket for their journey.

We need a new independent ombudsman to resolve passenger complaints and it should give new powers to the Office of Rail and Road [ORR] so that it can take action against train companies that continually let their passengers down.

Over to you

So, do you think a new consumer strategy is needed to ensure the government implements change in these failing markets? What else would you like to see put on its agenda?

Comments
Guest
SusieQ says:
23 October 2016

Instead of constantly knocking the railways we should be investing in improving our railways. We need a world class rail system that is on a par with the rest of Europe.
We don’tvalue what we have until we no longer have it!

Guest
Vera Turnbull says:
21 November 2016

We do not need this high speed train that is being thought about or planned.
If someone wants to get either to London from Edinburgh or vice versa why not fly there?
A waste of money!!

Guest

Vera you have just upset 5.3 million Scots , dont you know Scotland will not get HS2–“no business case” not happy bunnies over this over the border .

Guest

We do need HS2, and HS3 and 4. These major infrastructure developments are never easy to sell, because the results are often not predictable or the benefits easy to anticipate. But flying anywhere has become as welcoming as two weeks in a Gulag. With train travel within the UK the new HS rail systems will free up a great deal of the conventional rail network and allow for more local services; they’re currently restricted owing to the shortage of actual track.

If we look forwards then business leaders in Edinburgh, for instance, will be able to hop on a train and be in Paris or Brussels far more quickly than they can at present.

Guest

We do need extra railways, but I contend we do not need the very high speed services proposed – they add a great deal of expense, they reduce flexibility – no intermediate stops – they cause far more environmental damage because of track alignments. They are not designed to carry freight. And who are they for? Just how many “business leaders” would hop on a train in Edinburgh to go to Brussels – particularly in 15 years when it might be possible and Brussels will have much less significance?

We should be investing the money in new fairly high speed routes, and upgrading existing ones, particularly to distribute goods and get HGVs reduced on our roads. We should have intermediate stations (like Japan). We should not be encouraging long-distance commuting for the wealthy – probably unnecessary when HS2 might be completed. Technology will reduce the need to travel. How many other worthwhile causes could use the money?

Guest

Not sure where you get the idea there are no intermediate stations, Malcolm. On the HS1 to Paris, for instance, there are as many stops as there are on the Virgin West coast express from Chester to London. Of course HS trains have intermediate stops. They won’t make money without passengers.

And of course they can carry freight. However, it’s likely they’ll be used primarily for people moving and the other, slower lines can be used for freight – those freed up by building the new HS2 (and 3 and 4).

The continent is well used to HS trains and they have a lot of them. In fact, only the US has no HS tracks whatsoever, but the reality is that the benefits are very hard to establish without the thing being built. However, all the HS trains in Europe and even Eurostar are making a lot of money. So your only argument comes down to “not () encouraging long-distance commuting for the wealthy ” which is a little odd, since the current HS trains all operate with costs very much in-line with and even cheaper than Aircraft.

We use HS trains a lot, since we discovered some things: they’re as cheap to use as aircraft, they get there without your ears popping, they get you to the centre of cities – not a field 15 miles away – and they’re incredibly comfortable compared with flying.

Of course it was always going to be a hard sell, since so many can’t see what infrastructure improvements have brought societies and cultures, historically. But when infrastructure improves, so do societies and cultures, and their economies. Even the Romans knew that and the truth of it has been demonstrated innumerable times since then.

Interestingly, we’re just back from a week in the city of lights (no. not Blackpool – Paris) and our youngest flew while we took the train. To get home the same time as us they had to leave Paris two hours earlier, suffer interminable security queues, sit in a cramped cigar tube, not offered anything to eat or drink and still only arrived at the same time as we. We, OTOH, strolled down to the station, walked onto the train, enjoyed a three course dinner with a decent Merlot, and were delivered to within sixty feet of our eventual destination.

Our culture has had a love affair with flying – I agree – but we’re no longer on speaking terms and the only reason I’d use the ‘plane again would be for trips when the train simply wasn’t an option.

Guest

Ian, the line from London to Birmingham has no intermediate stops and when I last looked at the “prospectus” there were no plans to carry freight – not even mail.

I’m not sure what proportion of the British public will want to pay a high price for a ticket and for a 3 course dinner with Merlot on HS2. And that’s the worry – just who is it aimed at? Remember we are in an age of increasingly useful electronic communication,and who knows how much more that will have developed by the time HS2 even begins to run. So why will so many people have to travel to meet face to face? Freight will always need transporting, and the faster it can be, the more appealing to business and us. We should be spending our money developing this.

But that is just the personal view of a taxpayer having to fund it.

Guest

I agree there is the issue of how things will change in the future. Curiously, though, face to face meetings are still the preferred option by businesses. It may have something to do with picking up on sub-vocal and other subtle signals that teleconferencing simply doesn’t offer for the moment but people still prefer physical contact to simple imaging. Our eldest tells us there are a host of genetic and survival reasons for this.

But I suspect the biggest market will be tourism. People actively enjoy train travel – we certainly do – and the costs are easily comparable with flying. The meal and Merlot was included in the cost, so that doesn’t come into it.

I’ll bet at least one intermediate stop will ‘appear’ by the time the project has started in earnest. HS2 is already underway and the contracts have been signed, so that would now be as expensive to stop as to build (surprised me, too, when I found that out). Whether we’ll ever see 3 or 4 I have no idea. As you say things may well change.

Guest

There will be a stop on HS2 at Old Oak Common in west London for interchange with lots of other regional and suburban services, Underground, and so on but after that the train will charge off towards Birmingham without stopping. I don’t know the precise route but between Old Oak Common and Birmingham I am not sure there is a particular place at which it should stop. All the most important towns and cities are on the existing West Coast main line or other rail routes which will be greatly relieved by the extra capacity of HS2. I would expect HS2 to take more than 50% of the London – Birmingham travel market. There will probably be a premium fare but it will still have to be competitive. A more pleasant journey to Birmingham is available on the Chiltern route from Marylebone.

After completion to Birmingham the route will diverge with one branch going to Manchester and another via an East Midlands hub and Sheffield to Leeds, so Birmingham will only be an intermediate point anyway. The important element for other parts of the country is that some of the trains on the high-speed routes will be able to run off the route onto ‘classic’ rail lines to serve other destinations like the North West, the North East, and Scotland. This will be at lower speeds on those sections [up to 125 mph] but will avoid the need for changes.

I think it was unwise to focus so heavily on speed at the outset [perhaps we were envious of the French TGV] whereas what the UK needed was more capacity. I sympathise with Malcolm’s point about the engineering for high-speed lines having a greater environmental impact, but nobody designing a long-distance railway today would do it other than to the optimum standard. The benefit of higher speeds is that many more trains can be carried on the same length of track simultaneously and obviously fewer stopping places means more continuous traffic and no necessity to build loops so that non-stop trains can overtake the stoppers.

As I understand it there are proposals for some 100 mph freight traffic to use HS2 overnight and at other times when it can fit in the passenger timetable, but essentially the new route will free up much more useful slots for freight trains on the existing railway which has connections to the freight destinations, ports and hubs.

Guest
Tom Mason says:
23 October 2016

The government bailed the banks out with tax payers money, and kept urging them to lend to stimulate the economy. They didn’t do it. They then offered them cheap money to stimulate lending, which was effectively a further subsidy from the tax payer. What did the banks do in return reduce savings rates to customers to an absolute pittance as they don’t need to encourage money in any more, as the government is providing it so cheaply. Stop subsidising the fat cats now and let them stand on their own feet on a commercial basis. There are more savers than borrowers in this country and they deserve a fair return.

Guest
TomT says:
24 October 2016

Agree

Guest
Theologian says:
24 October 2016

Absolutely. If the government wants me to spend more money to help the economy then I need more money to spend in the first place – and increasing the interest rate on my savings is one very obvious way to do that.

Guest
Audrey Mabbott says:
24 October 2016

I agree with every word Tom Mason says.

Guest

If as Tom Mason says there really are more savers than borrowers in this country then the savers are not going to get much in interest. It would be interesting to know instead what is the total amount on loan against the total amount in savings because it is the ratio between those two figures that determines whether the banks need to attract savers by paying them higher interest. At the moment it seems that it is not necessary and the reason, as Tom Mason rightly says, is that the quantitative easing [QE] policy has released enough liquidity to enable the banks to stimulate the economy, the uptake of which is obviously a factor of demand. The QE policy had wider objectives than helping savers as its purpose was to generate a higher level of funding for capital investment as well as stabilising the economy The second part of that seems to have been effective even if there is possibly some disappointment over the first part. The Bank of England and the Treasury presumably took the view that since savers were already able to earn interest significantly ahead of the rate of inflation no further stimulus was required given that any such increase would impact on mortgage interest and consumer credit rates. Keeping them at a low level is seen as a more expedient way of achieving economic buoyancy. For several years now, savers have suffered from low interest rates in order to check inflation while borrowers have been sheltered from the full force of the economic climate. The balance has become inequitable and I did detect a hint of recognition of that in a speech by the Prime Minister on taking up office so I think we can expect some changes, possibly in the Chancellor’s Autumn Statement. Inflationary pressures are building already so I think we need to brace ourselves. Whether there will a nett gain for savers remains to be seen.

Guest

“Saving” is a passive activity. We expect to simply give our money to someone else who has to make it work to earn money. We could, instead, use our money “actively”, and in ways we might approve of. For example, invest in those businesses we want to support, to help them grow and contribute to a better UK economy. In return you should get much more (in relative terms) than mere savings interest. 3.5% in cautious investments. Of course the downside is the value of your investments might go down, or it might well go up. And if you reinvest the income you will generally beat cash savings hands down. But it is for the longer term.

Guest

Are British banks bankrupt?

Guest

Pip- according to WordPress ,in whom I have great respect in backing ,open free debate on the web–YES ! To get the truth of the matter , once again you have got to visit the US which , although 100 % capitalist still, to certain extent, allows free speech by its citizens to be posted on websites , although they cant help getting digs in about Brits–they dont talk -English -etc. quote- analysts working for the RBS , one of several British banks to have received emergency funding from the UK government –told the City the “domestic ” UK banks are technically insolvent on a fully marked -to-market basis –it goes on — the urge to cover up what one ought not to be doing is immense therefore Secret Plans to allow printing by the BOE without having to legally declare it –etc–etc. It goes on giving British banking legal history being flattened. Dont take my word on this most if not all world bankers -George Soros etc advise buying gold and that the balloon is going to bust worldwide due to massive debt by banks and the US economy . Although the above is a few years out of date I have another from 27 Th October =2015 along the same lines .

Guest

No, PIP, they are not bankrupt. They are solvent, they have massive capital reserves, huge investments, and enormous collateral. One or two might be making trading losses but their balance sheets are strong. The Bank of England, the Prudential Regulation Authority, and the Financial Conduct Authority would intervene if there were any risk to a bank’s stability.

Guest
Andy Bostock says:
23 October 2016

Frankly I am doubtful that we will get any useful improvement to consumer rights from a government that is in the process of wrecking the UK economy vie ‘Brexit’ for its own narrow political reasons. However what we need in the UK and for that matter in Europe and the rest of the world is a systematic strategy to tackle and stop the idea that seems to be embedded in many businesses that if they can take advantage of the public then it is legitimate for them to do so. This sort of attitude in e.g. in medicine would be regarded as totally unacceptable. Doctors take a hypocratic oath, are expected to abide by it and in general take their responsibilities seriously. There is no reason why the public should not expect the same of business people. Most businesses and some, such as banking, in particular enjoy privileges under the law. If they cannot or will not act honestly and ethically thoseprivileges should be withdrawn.

Guest
Kit Keith says:
23 October 2016

The Government did not want Brexit so I am pleasantly surprised to see the Prime Minister carefully proceeding with measures leading to the return of our sovereignty . I will willingly accept an adverse effect on the British economy for a few years in exchange for us to regain control of our affairs. In the longer term I believe our economy will flourish.

Guest
Patrick Ellis says:
23 October 2016

Could not agree more!!!!

Guest
Peter says:
24 October 2016

Sort of agree with you. However human nature is what it is and there are people in all walks of life will do what they can get away with – that applies to bankers bonuses, MPs expenses, pension schemes raided (Maxwell and Sir [or not] Shifty (didn’t the Post Office to?), Q jumping in Lidls, parking on double yellows.

Guest

I think medicine is a poor example to evidence “not” taking advantage of the public…. 19 NHS trusts in debt through poor cost management, medicines and procedures are a post code lottery as a result, negligence claims at an all time high…and why. Senior NHS staffers many crusty Consultants who want the Carry on Nursing status quo maintained, feel threatened by change and as a result are pathological in their resistance. All of which results in the NHS failing /lying to the Public whilst working doubly hard to maintain the starched white swan imagine whilst beneath the water paddling like **** to stay afloat……

Guest

I think “duck” is the word you are looking for in this case.

Guest

That dry humor sure makes me laugh John.

Guest

Thought the humour was wet, duncan 🙂

I see doctors have identified 40 procedures/treatments that they regard as pointless and wasting the NHS money. I would be interested to see these all listed for a Convo. I am all for getting rid of truly pointless practice.

Guest
george mcrae says:
23 October 2016

why is the price of energy so high, all the time the prices were going up we were told it was nessescry as they bought 2years ahead but when it came to prices going down they kept them up all sort of excuses were used but they did cut the top boys wages nor bonuses nor pensions they still live the life while people had to make a decision hear or eat when are the people going to get their proper share

Guest

george, my energy bill is now 24% lower than it was 2 years ago, based on the same usage. Just shopping around. And 2 years ago I had shopped for a decent deal, not a standard tariff.

The large companies have the resources to purchase several years ahead to attempt to give some price stability. In very recent years we have seen a lot of new, small, energy companies appearing that buy at current low prices, but don’t have the security to buy forward. So while we can take advantage of them now, they will likely become uncompetitive when wholesale prices rise. Make hay while the sun shines but time your switching carefully.

Guest

All this brings back to my mind an address by Harold Macmillan to the Conservative Party conference in 1962. He was one of the towering politicians of the twentieth century and Prime Minister for nearly seven years. I have given away the disc that included it so I cannot now remember what he was caricaturing the Labour government over but I clearly remember the words: “So what did they do? They solemnly asked Parliament, not to approve or disapprove, but to ‘take note’ of the decision. Perhaps some of the older ones among you will remember that popular song: ‘She didn’t say “Yes”, she didn’t say “No”. She didn’t say “stay”, she didn’t say “go”. She wanted to climb, but dreaded to fall, she bided her time and clung to the wall.’“. Private Eye put it to music and issued it as a vinyl-laminated cardboard 45 rpm record free with the next fortnight’s magazine.

Is that where we actually are with Brexit now? In a quandary and hurling rocks at each other? With hindsight it is easy to say we were asked the wrong question. If it had been “Do you want to stay in the single European market OR put a stop to large-scale immigration from the EU and elsewhere” the outcome might have been more decisive one way or the other. We have belatedly discovered that the two concepts are not just incompatible but mutually exclusive, and some people think both that the electorate were fooled and that we should start all over again.

I voted to remain but I don’t see the point of regrinding the millstone. We are lumbered with it and must make the best of it. My own sense is that the public put control over immigration above the single market. Nobody can say we were misled. Nick-named “project fear”, the remain campaign was on full throttle but it was denounced as scare-mongering. We shall see.

Politically, the issue is like one of those opinion bars where you can drag a blob to the left or right to the position that best reflects your viewpoint and the outcome changes with every move of the blob. So there is no definitive point on the bar where everyone will be satisfied. Ignoring the extremes, in the middle there must be a zone where we can “trade” access to the single market to different degrees against control over immigration to different extents. The PM & Co have now to discover this zone against the antipathy of 27 other countries and drill down into it. This is one heck of a task and the chances are that two thirds of the population will be dissatisfied with the outcome.

Guest

We were asked to decide whether to stay, or go, bombarded with lies and deceit from both sides to try to persuade us – just as politicians do at election time. Hopefully there are a large proportion of thinking voters amongst the electorate who considered their view – an important feature of a referendum. The majority voted to leave. We keep being told it was about immigration. Since that question was not posed I have no idea why that assumption should be made. A 100% majority in our household did not consider immigration the major concern. It is the EU inefficiency, bureaucracy, waste, lack of accounts, unfair distribution of resources, childish behaviour, scandals – things we can all do much better in a “British” way.

The government is now having to deal with the country’s decision – just like having to put up with whatever manifesto a party promised at a general election. If the current EU posturing and aggressive behaviour is anything to go by I am now delighted we will be leaving them – contrary to my vote.

Guest

I go along with that, Malcolm. I wouldn’t underestimate the anti-immigration sentiment but other factors weighed heavily as well – inefficiency and waste top my table [recalling butter mountains and wine lakes]. I certainly share your feelings in the last sentence. I have my own views on the collective psychology at work now but would welcome a professional assessment given the prevailing indicators.