Speaking on 29 September at the Labour party annual conference, UK opposition leader Ed Milliband has promised to scrap energy regulator Ofgem to stop consumers “getting ripped off” by gas and electricity firms. The labour leader says his radical plan is just the first shot in an all-out war for economic justice.
Characterising Ofgem as toothless and ineffectual, he pledged to replace it with a body that will stand up to the country's 'big six' energy companies. “The current system of regulation is not working,” he says. "We need ... a new regulator with legal powers to keep prices down. We’ll make sure when the big energy companies pay less for the power they buy, you pay less for the energy you buy."
In August Scottish & Southern Energy nnounced a nine per cent rise in its gas and electricity prices to consumers effective 14 October. This is a figure well beyond what was expected, but now other suppliers are expected to follow.
Labour says Ofgem often sides with the big firms, pointing out that its investigation into predatory pricing has yet to report back, 18 months after starting. Ofgem is also accused of failing to help smaller suppliers enter the market and to bring more transparency to how prices are set. Shadow Energy secretary Caroline Flint said: “Time after time, Ofgem has ducked the opportunity to get tough with the energy giants, failed to enforce its own rules, and let energy companies get away with ripping off hard-pressed families and pensioners. The time has come to say goodbye to Ofgem and create a tough new regulator the public can trust.”
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