The Government formally reviewed Ofgem’s role in 2011. Since that review, we have strengthened its powers to investigate and penalise market manipulation, and Ofgem has taken firm action to improve competition, including reforms of the retail and wholesale markets. Last week it proposed referring the energy markets to the competition authorities—the first ever such reference.
Finally, one might say, Ofgem has referred the six big energy companies to the Competition and Markets Authority. If the Minister reads the small print in Ofgem’s statement, however, he will find that it does not cover power generation. Is that not another failure by Ofgem to deal with the problem properly? It is not possible to deal with the issue if power generation is left out. Is it not time that Ofgem had the plug pulled on it and we had a real regulator with teeth?
I am afraid that the hon. Gentleman is not right about that. This reference is of the energy market; it includes power generation. Simply winding up Ofgem would mean that another regulator had to be set up in its place. Labour set up Ofgem, and now they want to abolish it, but they would have to set up another regulator. They seem to have a quango fetish.
Does the Minister of State agree with the consumer report published by Which? at the end of last year which said that consumers had been put out by £4 billion a year since 2010? If he does agree with that report, does he think it is consistent with the regulator having done a good job, as he has just assured the House it has done?
Last December the Secretary of State declared that Ofgem was fit for purpose. Is not last week’s reference to the CMA evidence that it is not fit for purpose and needs to be scrapped?
It is Ofgem that made the reference, so I do not follow the hon. Lady’s logic. We have strengthened the powers of the regulator, and for the first time ever, the regulator has referred the energy markets to the competition authorities. That is evidence of a strong regulator doing its job.