Consumer groups criticise utility watchdog reforms

GOVERNMENT PLANS to set up new consumer watchdog bodies covering the gas, electricity, water and telecoms industries came in for heavy criticism yesterday.

Consumer groups warned that the new consumer councils announced by the Energy minister, John Battle, lacked adequate powers and would not have full access to information from the utilities. There was also concern that Mr Battle had not set out a timetable for introducing the legislation. Nor was there any information on the funding of the bodies.

Mr Battle said that privatised utilities had put shareholders' interests first for too long. The councils would redress the balance, creating an independent, powerful voice for consumers.

But the Consumers' Association said it was "extremely disappointing" that ministers had chosen to limit the councils' powers. "The Government has missed a golden opportunity to put words into action," it said.

The Ofwat National Customer Council also criticised the shortcomings in the powers of the new councils. Sheila Reiter, its chairwoman, said the new bodies would have no powers to audit complaint-handling procedures of individual water companies or to compel them to resolve consumer complaints.

Jenny Kirkpatrick, chairwoman of the Gas Consumers Council welcomed Mr Battle's announcement but cautioned: "What he has not said ... is when the necessary legislation will be put before Parliament."

But Mr Battle defended themove, saying the councils would have statutory rights to information for the first time. He said he hoped to introduce legislation early in the next session of Parliament so that arrangements could come into force next year.

The legislation will also reform the system of trading in the electricity pool and allow a merger of the gas and electricity regulators, Ofgas and Offer. The Gas Consumers Council and the Electricity Consumers' Committees will also be merged. A new chairman is due to take over the single body in September.

Meanwhile, Mr Battle denied that the decision to grant approval for a pounds 300m gas-fired power station in Baglan Bay near Swansea in the run-up to elections for the Welsh assembly marked a U-turn in energy policy. The Government had imposed a de facto moratorium on new gas stations to protect the coal industry but cleared the Welsh project citing its impact on local employment and economic regeneration.