The CMA’s Energy Market Remedies: Boxed into the Wrong Corner?

April 14, 2016

(By David Deller) In an earlier blog post, I provided an initial reaction to the CMA’s provisional remedies for the UK energy market. This blog post considers the underlying assumptions that appear to have provided the ‘envelope’ for the remedies that the CMA considers suitable and proportionate. I critique the CMA’s reasoning in three core areas: (i) the size of interventions that could be justified by the estimates of harm; (ii) why the headline harm estimates are likely to be overestimates; and (iii) the limited evidence for concluding that smart meters are a panacea to low consumer engagement. After such a lengthy investigation it is disappointing to see such weaknesses in reasoning. Read the rest of this entry »

How weak is customer response in the energy market, why, and what is the benchmark?

March 17, 2016

(by Catherine Waddams) In its provisional decision on remedies for the Energy Market, the Competition and Markets Authority measures weak customer response by the amount of money which is ‘left on the table’ by customers who do not switch to cheaper tariffs.  However, research at the Centre for Competition Policy shows that understanding such inertia is complex, and that consumers differ considerably in their propensity to change suppliers.  This variation is found even among comparatively well informed respondents who are aware of potential gains and the time it might take them to search for and switch to a better deal, and even after accounting for observable demographic and other factors, and for consumer expectations.  This matters both for designing an effective package of remedies and, in due course, for evaluating their success.  Why? Read the rest of this entry »

Should Energy Customers be Empowered or Protected?

March 14, 2016

(by Catherine Waddams) The Competition and Markets Authority (CMA) has argued that competition is the way to empower most energy customers, but that prepayment users need additional protection. The compromise highlights the tension between competition and protection, because although competition is often the best way to ensure the lowest average prices and highest service quality for consumers on average, it is a process which carries no guarantees about the outcomes, nor about which particular customers and providers may win and lose from the process. Read the rest of this entry »

Would Jeremy Corbyn as Prime Minister mean the end of Competition Policy?

August 17, 2015

(by Andreas Stephan) The UK’s Labour party is currently in the process of selecting a new leader. The front-runner, Jeremy Corbyn, may become Britain’s first socialist Prime Minister in a generation. This blog post considers what a Corbyn government could mean for competition policy. Read the rest of this entry »

A Regulator’s Price Comparison Website is Not Sensible: comment on Catherine Waddams’s blog post

July 9, 2015

(by Stephen Littlechild) Catherine, I enjoyed your stimulating blog today. You are quite right to point out that CCP anticipated and confirmed the adverse effects that Ofgem’s non-discrimination clause had on competition, as now confirmed by the CMA. And I entirely agree with you that the proposed protective tariff for those that do not switch is very ill-advised. But I am puzzled why you consider it very sensible that Ofgem set up an independent price comparator website [PCW] for domestic customers. Read the rest of this entry »

CMA Provisional Energy Market Findings: Does protecting the weak (even temporarily) make them stronger?

July 7, 2015

(by Catherine Waddams) In its provisional findings on the energy market, the UK’s Competition and Markets Authority (CMA) focuses on weak consumer response – but one proposal, to introduce a protective tariff for those who do not switch, might prove counterproductive. Read the rest of this entry »

What could repeal of the Health and Social Care Act 2012 mean for the application of competition law and the English NHS?

May 5, 2015

(By Mary Guy) In view of the significant opposition to the competition provisions of the Health and Social Care Act 2012 (HSCA 2012), it is unsurprising that several parties are explicitly proposing repeal in their 2015 UK election manifestos. Repeal of the HSCA 2012 appears to offer a neat shorthand for dis-applying competition law with regard to the English NHS. But how do the competition provisions of the HSCA 2012 relate to the application of competition law, and what would repealing them actually achieve? This blog post explores these two questions by specific reference to s.72 HSCA 2012, so “competition law” is defined as the anticompetitive agreements and abuse of dominance provisions.[1] Read the rest of this entry »


Get every new post delivered to your Inbox.

Join 503 other followers