That’s quite a record. It is really difficult to think of a more glaring case of complete regulatory failure in modern times than this. The FCA has had some shocks under the dubious guidance of the current Governor of the Bank of England, Andrew Bailey, but the cost of oversight is more difficult to quantify and cases are few. What has happened in the energy market is clear, immediate and widespread – and it has had a very visible impact on consumers in a time of already significant difficulties for so many. According to the NAO: “Consumers have borne the brunt of supplier failures at a time when many households are already under significant financial pressure, having seen their bills rise to record levels.” This must not be repeated. Ofgem said it accepts the NAO findings and is working to rectify the issues that arise, but can it really be credible to tidy up its own home after the chaos it has presided over? The first signs are not encouraging. If the regulator did its job properly, it would take immediate steps to protect deposits. As Ofgem CEO Jonathan Brearley admits, in some cases customers’ cash is treated as an “interest-free company credit card”. It’s a smart line, but what does the guard suggest to do about it? A “tough” repression has been promised, but the devil is in the details. The best that Ofgem can do is say that it is “appropriate” to bring the full fencing requirements “as soon as possible”, which it admits is unlikely to happen before the end of the year, when energy bills will have risen. again, threatening further supplier insolvency. We must first wait for the findings of a consultation so that Ofgem can “better understand” the risks to the industry. Sounds like an open call for suppliers to push hard for more lenient reforms. This is not allowed to happen. The regulator must act hard and fast to protect vulnerable customers from further pain. It is now clear that his light regime was a colossal failure.
