A REVIEW of the regulation of the privatised utilities, many of which face the imposition of a windfall tax on profits in tomorrow's Budget, was announced yesterday by President of the Board of Trade Margaret Beckett.
Her review is to focus on the gas, electricity, water and telecommunications industries, with transport investigated separately by deputy Prime Minister John Prescott.
Strongly denying that the move was in anyway a bid to exert Government control over these private companies, Mrs Beckett said the study would look at whether changes were required to the system of regulation, indicating it would cover investment, executive pay, pricing policy, an adequate return to shareholders and benefits to customers.
The first regulatory regime was put in place 13 years ago and Mrs Beckett said it was ''now time to take stock''.
''It is not so much that we are saying this is all wrong and terrible - there have been considerable strengths - but we do think after all this time that we do need to take a look at it,'' she said.
Privatisation had been sold to the public as beneficial to customers but the shareholder came first she explained, adding: ''We think the balance between the shareholders and customer needs to be looked at afresh.''
Mrs Beckett stressed the importance of regulators in ensuring that customer interests were addressed alongside those of shareholders and in keeping prices low.
''These are essential industries operating in very important areas of our economy and they have to deliver the kind of service people need at the kind of prices they can afford to pay,'' she said.
Mrs Beckett was keen not to rule anything out of the inter-departmental review at this stage. But she did not hold out much hope for the creation of a ''super-regulator'' being put in charge of all the privatised utilities, although one option was to merge Offer and Ofgas into a ''single regulator tasked to deal with both aspects of the energy industry''.
On the notion that there was some super-being who could regulate all the utilities, she said she would require some persuasion.
She insisted: ''We are not talking about the Government taking control by the back door but we are talking about taking a long, cool look at whether there are changes and improvements we can make. It is time to take stock of the regulatory experience as a whole, and identify whether there are general principles which can be transferred from one sector to another and - where possible - to identify best regulatory practice.''
The lessons learned from the DTI-led review could also be passed on to other Government departments, she added.
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