My Lords, I support what my noble friend has said in moving the amendment. I want to address for a couple of minutes Amendment 105A, which deals with the issue of consumer representation and how it is reflected within the structures of our regulators.
In general, it is stated early in every of the relevant Acts that the regulators are there to protect, advance or reflect the interests of consumers of gas, electricity, water, telecoms or whatever it may be. Much of the drive within those regulators is indeed geared towards that. However, it is also true that a whole lot of other broader, less direct duties in relation to consumers fall to those regulators. Successive Governments have, rightly or wrongly—I will not go into that too much—placed additional responsibilities on regulators to have regard to wider issues, to long-term and short-term issues, and to social and environmental consequences, for example. One understands all this if we are to develop industry in a way that meets those wider objectives and looks after the interests of consumers.
Put gently, in some cases the duty to look after the interests of consumers, in a simple sense, has been slightly lost. Some of that reflects the fact that the personnel who form the boards and the senior management of these regulators by and large do not come from a consumer background. They come from various technocratic and business backgrounds and in some cases from an academic background and they have the expertise that is necessary to understand the industry that the regulator is dealing with. However, the voice of the consumer in a clear sense is much more difficult to identify.
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In some sectors, the Government have at various points established a separate consumer body to look after the consumer voice. They established Energy Watch, the Consumer Council for Water and so on. In other cases, they set up an internal panel—for example, the Financial Services Authority, as was, or the FCA as it is now. I am not saying that those measures have not achieved a considerable benefit to consumers in their dialogue with the main board and the main management of the regulator, but they are a fairly small part of it. If you look at the appointments to the boards of regulators over the past 10 years, you will not see that many who come from a consumer background. Those who do are very good, but they have often had an uphill struggle in order to gear the internal organisation of the regulator to their concerns.
My noble friend’s amendment would at least require the Government and each sponsoring department to look carefully at how the regulators operate, how the
balance of representation on the oversight of those regulators operates and whether the structure is right to get a real reflection of how consumers on a day-to-day basis and in their long-term interest get reflected in the now quite complex apparatus that our major sectoral regulators operate. The amendment asks the Government to look at that but does not specify precisely what the Government should do. We need to assess whether the present system is working. In my view, there are a number of drawbacks to the system at present.