In a dig at Labour’s electoral promise to axe Ofgem and bring in a regulator “with real teeth to prevent overcharging”, Fallon said such a move would be “a waste of everyone’s time”.
Fallon said: “You have to have a regulator of some kind. It is foolish to waste two or three years scrapping one regulator and putting another one in its place. That is a waste of everyone’s time.”
Following “toothless tiger” jibes from Labour, Ofgem is reviewing its approach to enforcement. The regulator intends to “place a greater emphasis on deterrence” of misbehaviour by energy companies, which will mean a “substantial increase” in the level of penalties.
On Wednesday it announced the creation of an independent Enforcement Decision Panel.