CMA bows to industry pressure at expense of consumers says Citizens Advice
Citizens Advice reacts to the Competition and Market Authority’s (CMA’s) initial findings on the water industry’s appeal against the latest price control.
Dame Gillian Guy, Chief Executive of Citizens Advice, said:
“We’re disappointed the CMA’s initial findings are not recommending a better deal for customers - particularly at a time when so many people are struggling financially.
“Supplying an essential service shouldn’t be a one way street. The profits of these monopoly companies must be balanced by a fair deal for the general public.
“When the expected cost of maintaining industry infrastructure is set unrealistically high, bills are inflated unnecessarily.
“We call on the CMA to look again at all the evidence before it makes a final decision.”
Background:
Today’s announcement of initial findings is expected to be followed by a final ruling by the end of the year.
Our analysis showed Ofwat’s data was still too generous to the water network companies and their calculations would have led to an excess profit of £3 billion over the course of the next eight-year price control.
In evidence supplied to the CMA for use in considering this appeal by the water companies, Citizens Advice argued that the outcome should set a precedent for a better deal for customers which still allows the water network companies to make a profit and attract investors.
Our Monopoly Money report last year found that the energy, water, broadband and telephone networks had overcharged people a total £24.1 billion over the last 15 years of price controls. This was because the cost of capital (the investment needed to maintain the pipes and wires infrastructure) was set too high.
In its Excess Debt report last month, Citizens Advice showed one in 9 people, the equivalent of 6 million people across the UK, have reported falling behind on household bills because of coronavirus.
Notes to editors
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