Vulnerable consumers need more help, says NAO

27 Mar 08
All three national consumer regulators should use their competition and protection powers to ensure that customers do not lose out in a price free-for-all, the National Audit Office has warned.

28 March 2008

All three national consumer regulators should use their competition and protection powers to ensure that customers do not lose out in a price free-for-all, the National Audit Office has warned.

In a report, Protecting consumers? Removing retail price controls, published on March 28, the NAO says that while the removal of retail price controls had put competitive pressures on telecom, electricity, gas and postal providers, there had been problems for vulnerable customers.

It says that complex tariffs and a lack of information mean that some consumers are still unable to take full advantage of the competitive market.

It also found that suppliers that had had monopolies in the past continued to have a strong position in their original markets.

The report concludes that regulators must continue to work to protect the consumer. NAO head Tim Burr said: 'Ofcom, Ofgem and Postcomm need to be vigilant, and be prepared to use their other powers when necessary, to ensure genuine competition is present.'

Public Accounts Committee chair Edward Leigh said: 'While the opening up of the market has brought new alternatives, the fact remains that the leviathans of the utilities still have a grip on half of their old markets.

'As is too often the case, it is the poorer and older members of society… who are left behind. In general, there is a lack of good, reliable information for customers on price and service, which leaves many in the dark about what to do for the best,' he added.

PFmar2008

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