In his second guest post for our site, Business Secretary Vince Cable reviews how the Government is tackling regulation to improve the rail networks, the energy market and shopping at your local supermarket…
The Government has made some important changes to the competition regime and the consumer landscape over the last year. Together with the Consumer Rights Bill, which is currently before Parliament, we are working to build consumer confidence by making sure that consumers know their rights, and that businesses are clear about what is expected of them. Clarity and fairness sit at the very heart of our approach.
One result is the new Competition and Markets Authority (CMA) which started in full a month ago today. The CMA has enhanced powers, faster decision making processes, and will be able to work better with sectoral regulations to revitalise competition in markets and deliver greater benefits for consumers.
Building consumer confidence
Consumers are not really interested in the detail of competition law or regulatory processes. What matters most to them are lower bills, good customer service and having their complaints dealt with quickly and efficiently. That is why we are tackling these important issues.
Gas and electricity prices are good examples of problems caused by consumer confusion – consumers are faced with more than 350 tariffs and mind boggling bills. There is plenty going on in this area. The joint CMA and Ofgem review into the state of competition in the energy market has identified five areas that need to be looked at. This includes the rising profits for the Big Six that don’t appear to be based on greater efficiency and what barriers there are to market entry and expansion for new companies. This would not have happened without the new collaborative approach that we have been championing.
Ofgem is now consulting on whether it refers these issues to the CMA for a full market investigation.
Reducing regulated rail fair rises
As well as stimulating competition we are also helping consumers in other key areas such as winter fuel payments, rail fares and the relationship between supermarkets and their suppliers.
In addition, we have pledged over £16bn for the rail industry to improve capacity and the quality of the network. As a regular train commuter from my home in Twickenham I am well aware of the frustration about the continued rise in fares and the impact on family budgets. That is why for 2014 we have reduced regulated fair rises to RPI.
Finally, we have introduced the Groceries Supply Code of Practice which is overseen by an adjudicator – Christine Tacon. Her role is to arbitrate in disputes between the 10 largest supermarket chains and their suppliers. She will also have the power to impose fines and to name and shame supermarkets that breach the code.
Together these steps are going to make a real difference for consumers and make sure they are getting the fair deal they deserve.
Which? Conversation provides guest spots to external contributors. This is from Vince Cable, Secretary of State for Business, Innovation and Skills – all opinions expressed here are Vince’s own, not necessarily those of Which?.
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