Julian Knight: Has the toothless energy regulator learnt how to bite?

Ofgem, it seems, has had enough of the pricing tactics of the energy companies.

Price rises by three of the big six energy firms have prompted the regulator to launch an investigation into profiteering. The probe will take three months at least, but I could save them time and effort, and tell them that the energy firms are routinely ripping off the British public. Here is how I know. The firms say their pricing depends on the wholesale cost of energy, which is perfectly logical – basically, as the wholesale price rises, they pass this on to customers, while retaining a profit margin to pay for investment and, of course, to give to their shareholders. I don’t have a problem with this. But the energy firms have got greedy, using the ups and downs of the wholesale market to skim extra cash off the top. When wholesale prices rise, they rush to increase their costs to customers. But when wholesale prices fall, they wait an eternity before lowering their own prices.

A few years ago Ofgem chastised the firms for this practice and then fell into what seems to be complete inactivity. For too long, the regulator has let the firms get away with taking money from all our pockets with little more action than a few quiet words behind closed doors and the very occasional expression of concern. Unsurprisingly, the energy firms have taken Ofgem for a mug. Now, finally, Ofgem’s seemingly infinite patience has worn out and I suspect it hasbeengiven the green light from the coalition to go after the energy firms this time. Ofgem has the right to fine energy firms up to 10 per cent of turnover. Let’s hope it doesn’t chicken out this time and actually exercises this sanction.

The real tuition question

In all the protests over university tuition fees, I think the really important questions have not been asked. Forget whether Nick Clegg lied or not (he’s a politician, after all); what I want to know is how our universities can possibly justify charging up to £9,000 a year per student and is there any way that costs could be got down? My experience at university was that students were treated as an inconvenience by lecturers and the standards of actual teaching were frankly appalling. Let’s face it, many universities are just massive job creation schemes and little else. In the world of lightning-speed broadband, I reckon we could do without the traditional university campus. Instead, why not have a standardised larger scale Open University offering mostly one and two-year courses? When I went, for example, the first year of my course was called a qualifying year and it was a completely pointless exercise, requiring a minuscule mark to pass and treated as a bit of a lark by students and lecturers alike.

Repossession reprieve

Santa has come early this year for an estimated 3,000 people in Scotland facing the nightmare of repossession. The Scottish Supreme Court has found that lenders routinely fail to give homeowners in arrears proper notice of their intent to repossess. As a result, homeowners who currently face being dumped on the street in the run-up to Christmas have been given a stay, as lenders will now have to start the whole process again. This could lead to a delay in cases of up to six months, hopefully giving some a chance to escape what was sadly looking inevitable.