asked the Secretary of State for Energy whether any safeguard exists to prevent the nationalised fuel industries subsidising their retail outlets.

In response to recommendations by the Monopolies and Mergers Commission both the British Gas Corporation and the electricity supply industry have introduced revised accounting procedures for their appliance retailing activities. These changes necessitated a thorough review of the ways costs were allocated to the activities and the production of revised guidelines on cost allocation. In both cases these allocations are subject to the independent scrutiny of their auditors. At the same time both industries have an objective to operate their retailing on a profitable basis.