Philip Cullum: An exciting example of what consumers can achieve

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The Independent Online

The difference between what consumers are offered by each of the major fuel companies is marginal. Depending on your opinion, this is either a sign of a fiercely competitive market or one in which there is little competition. It's probably the latter.

The question of whether consumers are able to exercise informed choice is also a concern. The evidence suggests that a significant number of people switching companies end up with a worse deal, suggesting that the market may not be working as well as it should. These, and other worries, need to be thoroughly looked into. Yesterday's announcement by Ofgem betrayed a slightly begrudging willingness to investigate but, if this inquiry is to be worthwhile, it must be full and thorough, not merely a justification of the regulator's previous position.

Across the whole economy, consumers are becoming more demanding. Over the past year we have seen a whole host of examples of consumer power – whether vegetarians complaining about Mars Bars not being properly vegetarian; or real ale campaigners in Sussex; or the NUS campaigning on student overdraft changes with the help of the internet networking site Facebook. Above all, we're seeing many hundreds of thousands of customers standing up to their banks over charges.

The key thing isn't just that consumers are becoming more assertive, but that they are acting together to put pressure on businesses. It's the concerted nature of consumer action that's starting to keep chief executives awake at night.

You only have to look at various review websites – from holidays to restaurants – to see how people are exchanging their stories these days. Consumers, who were previously seen as concerned only about themselves, are, in fact, worrying about others. So it is no longer just about an organisation sending an individual an apology and a bunch of flowers when things go wrong; it is about a change of policy across the board, so that problems are sorted out for good.

Consumer power is set to rise. In April we will see the introduction of a law called the "duty not to trade unfairly", which potentially will put real power into consumers' hands. Where companies are behaving unfairly, for example by misleading consumers about products they are selling, local trading standards officials will be able to take legal action.

So, we'll see a powerful combination of people talking to each other about their experiences of good and bad business, concerted consumer campaigns against some firms, and fines for those who behave unfairly.

This isn't about being anti-business. At the National Consumer Council, we want the good guys to make good profits and the bad guys to lose out.

The challenge is to create markets where companies are fighting for consumer attention, which in turn leads to efficiency and innovation. The days when British consumers were reluctant to say boo to a goose are gone – but sometimes they need the help of regulators to make markets work properly, and this is what Ofgem is wisely doing.

The author is the acting chief executive of the National Consumer Council

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