Watchdogs to announce measures to ‘ease the burden on consumers’

Rishi Sunak said the regulators would set out the plans following a meeting with Chancellor Jeremy Hunt.

Chancellor Jeremy Hunt met with the chiefs of the main economic regulators on Wednesday morning (PA) (PA Wire)

Consumer watchdogs will set out plans to ease the burden of rising prices, Rishi Sunak said.

Chancellor Jeremy Hunt called in the chiefs of the main economic regulators for crisis talks about protecting people from the impact of high inflation.

He questioned the Competition and Markets Authority (CMA), and the regulators for the energy, water and communications sectors at No 11 Downing St on Wednesday morning over what powers they can use to help lower prices amid accusations firms could be profiteering through price hikes.

... they will be making an announcement later about their plans to ensure fairness of pricing and supply chains to ease the burden on consumers

Rishi Sunak

At Prime Minister’s Questions, Mr Sunak told MPs: “The Chancellor met with all the economic regulators this morning and they will be making an announcement later about their plans to ensure fairness of pricing and supply chains to ease the burden on consumers.”

But on Wednesday afternoon, almost four hours after Mr Sunak’s promise and eight hours after the meeting, there were no details of any announcement and no comments from the Treasury or regulators.

Mr Hunt met with bosses including the CMA’s Sarah Cardell, David Black of Ofwat and Jonathan Brearley of Ofgem.

It comes as Britons have witnessed rampant inflation through sharp jumps across a raft of their household bills, at the same time they swallow soaring mortgage costs due to higher interest rates.

Meanwhile, Downing Street insisted water companies should not “disproportionately” pass on costs to consumers for upgrade works.

Firms are drawing up plans to increase household water bills by up to 40%, according to The Times.

The Prime Minister’s official spokesman said: “We expect companies to put the interests of customers first and that means delivering key improvements in infrastructure and tackling issues like sewage … without disproportionately impacting people’s bills.”

Households have already witnessed a particularly sharp spike in energy prices during the cost-of-living crisis with the Government’s Energy Price Guarantee currently limiting the bill of a typical house to £2,500.

The average bill for households had been limited to almost half this, at £1,277, as recently as March last year. Nevertheless, bills are set to drop from next month as wholesale price decreases filter through.

Communication regulators at Ofcom are also facing scrutiny over mid-contract price increases of up to 17.3% for millions of mobile phone and broadband customers.

Meanwhile, rises in commodity prices and labour costs have also pushed the cost of food sharply higher, with the latest figures from the Office for National Statistics indicating that food prices in May were 18.4% higher than the same month a year earlier.

Mr Sunak has previously warned retailers about pricing “responsibly and fairly”, saying household weekly shopping bills had “gone up far too much in the past few months”.

Mr Hunt also confirmed that ministers were talking to the food industry about “potential measures to ease the pressure on consumers”.

He is expected to back a CMA review of food prices and reportedly sees regulators playing a central role in helping curb inflation.

Supermarkets insisted in a committee hearing with MPs on Tuesday that they were not profiteering, with Tesco claiming the group was the “most competitive we have ever been”.

The accusations of profiteering have sparked a backlash from the industry, with the British Retail Consortium, the trade body representing the sector, saying there had been a “regular stream of price cuts” by supermarkets despite experiencing “extremely tight” profit margins.

It followed official figures last week that showed Consumer Prices Index inflation failed to ease as hoped in May, remaining at 8.7%.

The Bank of England subsequently raised interest rates to a 15-year high last week in a shock move designed to tame inflation.