,
9 tweets,
3 min read
Read on Twitter
Are we charged too much for essential infrastructure like energy and water? Our experts have crunched the numbers and the findings are staggering... THREAD/
Turns out consumers have been over-charged by £24.1billion (!) over the last 15 years because of misjudgments by regulators that went in favour of industry. Full report - Monopoly Money - is here: bit.ly/2XhxWL8
Regulators thought companies would pay less to raise/borrow money than they did. As a result, we all paid £11 billion more than needed for energy, £13 billion for water and £100m for broadband and phone.
Let's deal with a credible response: some people say ‘regulators have a tough job, involving economic forecasts, and all the forecasters were wrong in this period’.
There's some truth in that. Regulators do a diligent job under massive pressure from industry (which is of course highly relevant to this story). But...
1. Why do the errors always go in one direction - against consumers in favour of industry? We never end up paying accidentally too little. (And, if we did, companies can re-open the negotiation!)
2. If forecasting is hard, don’t do it. We want regulators to index their decisions to real economic data, to remove this risk - and to reduce their exposure to lobbying power
So what should happen now? Companies should return the money. (If you think that's a pipe dream, it’s happened before. After our last report, @SGNgas @wpduk and @ssencommunity gave back c.£290m - good on them! And in 2013 water companies cut bills by £435m after high returns)
