The head of the National Audit Office (NAO) has told regulators that they often seem “somewhat academic and detached”to members of the public.
Unveiling a new study into the performance of the four key regulators by Parliament’s public spending watchdog, Sir Amyas Morse said that they should be better at showing the results of their activities.
The Financial Conduct Authority, Ofcom, Ofgem and Ofwat were the four regulators under the NAO’s microscope.
“Regulators need to do more to show the concrete results they are aiming to achieve for consumers,” he said.
“I understand that there is a difficult balance to be struck between long- and short-term outcomes, between the needs of businesses and the interests of consumers. But at present the regulators’ results can come across as somewhat academic and detached from peoples’ practical concerns and pressures.”
This approach could include being more specific about defining the overall outcomes they want to achieve for consumers, the NAO has recommended.
The NAO study states that regulators often set “broad high-level aims” without often defining what these mean in practical terms, such as whether the level and distribution of prices or service reliability demonstrate good progress or a need to take further action
“Clear success criteria such as outcomes-based targets are vital so that industry, consumers and consumer representatives are clear on regulators’ expectations and priorities and how these address consumers’ key areas of concern,” it adds.
The study also finds that regulators lack a joined-up way of setting objectives for issues that cut across sectors such as affordability and debt.
And it claims regulators find it difficult to manage the trade-offs between competing objectives in protecting consumers.
But the report states that all four regulators have good insight into the key consumer issues in their sectors, routinely engaging with the statutory consumer representative and complaints bodies in their sector.