Speaking at the Conservative Party conference today (5 October), the prime minister pledged that the government “can and should be a force for good, that the state exists to provide what individual people, communities and markets cannot, and that we should employ the power of government for the good of the people.”
May added: “That’s why where markets are dysfunctional, we should be prepared to intervene. Where companies are exploiting the failures of the market in which they operate, where consumer choice is inhibited by deliberately complex pricing structures, we must set the market right.
“It’s just not right that two thirds of energy customers are stuck on the most expensive tariffs.”
This builds on comments earlier in the conferference from business and energy secretary Greg Clark, who said the government “will act” on the £2 billion of consumer detriment outlined by the Competition and Markets Authority (CMA) “in the next few weeks and months”.
May’s comments follow rumours that the government plans to extend price caps after the CMA recommended a transitional price cap for prepayment customers until the completion of the smart meter rollout.
The CMA concluded its two-year probe into the energy market and published its final remedies for the industry in June this year. Its report included the creation of an Ofgem-controlled database for disengaged customers and the removal of the confidence code which requires price comparison websites (PCWs) to display a whole market view.
Panellist on the investigation, Martin Cave, spoke out against the price cap remedy, arguing that a wider temporary price cap should be applied in order to address the detriment better.