Committee of Public Accounts

Press Notice No. 14 of Session 2005-06, dated 29 November 2005


Mr Edward Leigh MP, Chairman of the Committee of Public Accounts, said today:

"The two bodies set up in 2000 to represent and advise consumers in the energy and postal markets, Energywatch and Postwatch, are performing feebly. Huge numbers of complaints, particularly relating to wrong energy bills and mail lost by the Royal Mail, continue to pour in. So, some five years after the creation of these well-funded, specialist consumer bodies, there is still a lot of public dissatisfaction with energy and postal services. Neither Energywatch nor Postwatch have got out there to find out more about consumer needs and difficulties, especially those of older people and low income families. Neither body knows how effective it is in helping consumers. And it can't help that only a tiny proportion of the public have heard of the two bodies. Energywatch and Postwatch need to stop stuttering along and start firing on all cylinders. At the same time, they must look hard at how to cut their overhead costs which are unjustifiably escalating."

Mr Leigh was speaking as the Committee published its 14th Report of this Session, which examined whether Energywatch and Postwatch have achieved benefits for consumers and are operating efficiently.

In 2000, the Government established two new consumer bodies, Energywatch and Postwatch. Their remit was to strengthen the voice of the consumer in energy and post by investigating complaints referred by consumers who are not satisfied with a company's initial response, representing the views of consumers and providing them with advice and information.

Energywatch and Postwatch have handled a total of over 300,000 complaints and achieved compensation for consumers who have suffered poor service. Their overall achievements are, however, unimpressive. In energy, the level of complaints has remained over 80,000 for each year of Energywatch's existence. Consumers have received late and inaccurate bills, and suppliers have unfairly blocked their customers from switching to cheaper providers or adopted aggressive sales tactics to induce consumers to switch.

In post, consumers have complained about the amount of misdelivered or lost mail, which Royal Mail estimates at around 14.5 million items each year. Complaints have increased every year since Postwatch's inception. In addition, Postwatch represent consumer interests when a post office is selected for closure by Post Office Limited, though they do not have the power to prevent a post office closure.

Energywatch and Postwatch have not gained significant consumer recognition, with recognition levels at around 2% of consumers, and consumers are also represented by many other Government and voluntary bodies such as the Office of Fair Trading, Citizens Advice and Age Concern.

Despite their modest record, the costs of both Energywatch and Postwatch have escalated since their inception and they operate from expensive London headquarters backed by a network of small regional offices. The Committee's recommendations highlight areas where Energywatch, Postwatch and the Department of Trade and Industry could improve performance and reduce their costs.

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