British Gas warned yesterday that the introduction of full competition in the domestic gas market next year could be jeopardised unless the Monopolies & Mergers Commission inquiry into its pipeline arm TransCo gave it long- term regulatory stability, writes Michael Harrison.
The warning came from David Varney, chief executive of the renamed BG, at the company's annual shareholders meeting in Birmingham. The company was referred to the MMC last October after it refused to accept price controls proposed by the industry regulator, Clare Spottiswoode of Ofgas, claiming they could result in 10,000 job losses and a pounds 400m cut in annual cash flow.
The MMC is due to report by the end of next month, meaning the decision on the future of the business will almost certainly be taken by a Labour government.
Mr Varney told shareholders: "It is essential for this MMC inquiry to provide TransCo with long-term regulatory clarity and stability, which is vital for the successful implementation of full domestic competition by the end of 1998."
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