Clause 14
Consumers, Estate Agents and Redress Bill
9:00 am
Jim Fitzpatrick (Parliamentary Under-Secretary, Department of Trade and Industry; Poplar and Canning Town, Labour)
Clause 14 requires the new council to refer a complaint that it considers to raise issues of general relevance made under clause 11(1)(a) to Ofgem. It will also be required to refer complaints made by designated vulnerable consumers and those relating to the disconnection or threatened disconnection of a gas or electricity supply to which clauses 12(3) or clause 13 apply. The council will refer such complaints when it considers that Ofgem’s regulatory functions may be exercisable and when Ofgem is not already aware of the complaint. When a complaint about a gas or electricity disconnection is made to the council and referred to Ofgem, the council is not obliged to investigate until the authority has had a reasonable chance to exercise its enforcement functions.
Clause 14 focuses on resolving problems in the most effective way. When the authority has enforcement powers in respect of complaints made by the consumer, it is sensible to ensure that Ofgem—the regulator—is aware of the matter and that it has the opportunity to use its powers to resolve it. That position is the same as the current provision.
It is important that Ofgem is made aware of problems that arise from a situation in which a licencee’s behaviour breaches licence conditions. Ofgem has powers to enforce licence conditions by, for example, imposing financial penalties of up to 10 per cent. of turnover. Ofgem also has powers to determine connection charges. When a consumer seeks connection to the electricity or gas network and is not willing to accept the distribution company’s quotation for the work, the issue can be referred to Ofgem, which can make a determination on the reasonable amount that a consumer can be asked to pay. That is an example of an issue that can be referred to Ofgem by the council for resolution.
The clause provides for the new council to notify a complainant if it considers that a complaint refers to a matter that can be referred to Ofgem under existing legislative provision. In our sitting of Tuesday 17 July, reference was made to the need to ensure that the council notifies a complainant in accordance with the key performance targets that we will set out. I commend the clause to the Committee.