Four of Britain’s top watchdogs have been criticised by the National Audit Office (NAO) for not doing enough to show how they are helping the consumers it is their job to protect.
In a new report the parliamentary spending watchdog claims that though the Financial Conduct Authority (FCA), Ofwat, Ofcom and Ofgem understand the difficulties faced by consumers in their relative sectors they cannot prove they are ‘effectively responding to consumer concerns or offering enough protection for those who need it’.
The regulators all have the 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.
But research by the NAO showed that none of them were able to prove they were being effective in dealing with their customer’s concerns.
The report recommended that the four watchdogs should do more to properly measure their performance against the high ideals they set so they can establish what’s working and what isn’t.
Once that is established they then need to improve the way they keep the consumer informed of the progress being made.
Chief executive Amyas Morse said: “Regulators need to do more to show the concrete results they are aiming to achieve for consumers.
I understand that there is a difficult balance to be struck between long and short-term outcomes, between the needs of businesses and the interests of consumers.
“But at present the regulators’ results can come across as somewhat academic and detached from peoples’ practical concerns and pressures.”
The most common problems dealt with by all four regulators are debt and credit repayments with consumers paying £140 billion a year on water, energy and telecoms bills, plus the £855 million cost of running the FCA.
Debt problems have been made worse by real term price increases of 28% for gas, 37% for electricity and 6% for water since 2007 with no corresponding increase in wages.
The NAO also points out that failing to switch to try to find the most competitive deals on products and services is costing consumers £4.1 billion a year with vulnerable customers less likely to switch.
Lack of trust
Consumer group Which? said there is a severe lack of trust in some markets ‘because people don’t believe their interests are being put first’.
Spokeswoman Caroline Normand called for regulators to be given stronger powers ‘to take on the might of powerful companies’, adding: “Regulators must also step up and clearly demonstrate how their work is making a positive difference and stopping people from getting ripped off.”