Byers outlines 'radical restructuring' of OFT

The Government yesterday set out details of its "radical restructuring" of the Office of Fair Trading, including plans to make the majority of its board members independent.

The Government yesterday set out details of its "radical restructuring" of the Office of Fair Trading, including plans to make the majority of its board members independent.

The new Fair Trading Authority, which will replace the OFT, will also publish minutes of its board meetings and set national standards for local consumer protection bodies.

A consultative document published by Stephen Byers, the Secretary of State for Trade and Industry, recommends that the authority should have between five and eight board members, the majority of them drawn from outside the OFT.

The board will primarily be responsible for deciding strategy but Mr Byers said it would have statutory authority to intervene in the executive operations of the OFT. The proposed changes will require primary legislation.

Mr Byers said a board was needed because of the very wide-ranging powers the new Director General of Fair Trading, John Vickers, would have. Mr Vickers, who takes over from John Bridgeman next month, will be the first chairman of the new authority. The Competition Act gives him much greater powers to clamp down on cartels.

Separately, the Government is also considering handing over responsibility for merger decisions to the competition authorities. "We do not believe it is appropriate for a single individual to be charged with these increased responsibilities," Mr Byers said in a speech to the Social Market Foundation in London. "There is a need for outside expertise to broaden the decision-making base, although we do not want to slow the decision-making process down."

Efforts are already being made to introduce more accountability and openness into merger decisions. Earlier this year the Government published the advice it received from the OFT on the three-way takeover battle between the television companies Granada, Carlton and United News & Media.

The decision to give the new authority a key role in setting consumer protection standards at local level follows an Audit Commission report last year which revealed enormous variations in the services provided by trading standards departments around the country.

Mr Byers also said the Government would be carrying out another international price comparison early next year of the charges paid by British consumers for a range of goods. However, he was careful not to play up the Government's "rip-off Britain" campaign and made a point of complimenting firms for the efforts they had made to help bring down prices. "I want to give credit to the very many manufacturers and retailers that have responded to the new mood in extremely positive ways," he said.

Consultation on the proposed new Fair Trading Authority will run until 26 January.