City: Overheated

BRITISH GAS will have got its copy of the Monopolies and Mergers Commission report on the future of the gas industry (or at least 70 pages of summary and conclusions) over the weekend - some two and a half weeks before its official publication date - so we can expect details to begin leaking with dispatch.

So far, British Gas has played an odd game in attempting to protect its interests. Using a vast array of public relations consultants and political lobbyists, it has launched an all-out assault on radical proposals from the gas regulator, Sir James McKinnon, to break the company up into 17 competing units.

You could argue, I suppose, that had it not done so, there would have been a severe risk of the MMC accepting the idea, but I wouldn't have thought that very likely; it was such a crackpot proposal from the start that it was never really a runner. It was too extreme and so complex and costly that there would never have been anything in it for the consumer.

Nevertheless, British Gas took the proposal very seriously. The effect is that when the MMC finally rejects it, as surely it must, everyone in the City and at Westminster is going to be left with the impression that British Gas got off lightly. Never mind the fact that there are plenty of other things the MMC can and probably will do to the company that will also be highly damaging to its interests.