Richard Lloyd calls for tougher action on big business in Sun on Sunday

This is a comment piece that ran in the Sun on Sunday on 19th May.

By Richard Lloyd, Which? executive director

Another week, another big business scandal. This time it’s the allegations of price fixing by major oil companies. It’s early days in the investigation but it’s unbelievably outrageous if motorists have been ripped off at the pumps to the tune of £300 billion over the last decade.
Whenever we ask people about the things they are worried about, the answer time and again is the rising price of fuel.
Eight in ten of us are worried about the price we pay to fill up our car. So it’s no surprise that a third of us are planning to cut back on motoring running costs in the next few months.
The current financial climate is hitting consumers hard. Around a third of us are feeling the squeeze and more of us are dipping in to our savings or getting into debt to pay for essentials, like food.
So the news that some of the biggest oil giants could have been scamming the country for over a decade will infuriate millions who have been struggling just to get by.
The Government has said that the “full force of the law” should be brought down on the oil companies if these serious allegations are found to be true.
They’re right.
This sort of outrage must be stamped out because it is hard-pressed consumers who have been paying the price.
There must be tough action against those found responsible for mass consumer rip-offs. That means hefty fines and the culpits put behind bars, not a slap on the wrist that barely puts a dent in profits.
This latest probe into the practices of Shell and BP brings the spotlight back onto our broken energy market.
With inflation-busting price increases and eye-watering profit announcements, it’s no wonder people question whether the price their paying on their energy bills is a fair one.
Only last month, the energy company SSE was fined £10.5m for mis-selling expensive tariffs to its customers.
But they’ve not been forced to go compensate those customers they led garden path. Instead, it’s up to the ripped-off consumers to go back to SSE and plead for the return of their own money.
That’s not good enough.
These energy swindles follow hard on the heels of the scandalous behaviour seen in the banking world, with price-fixing at the heart of the recent Libor rate-rigging scandal.
Yet despite the seriousness of the accusations, we still don’t know when the investigation into Libor will end, or even how many borrowers or savers have lost out.
But one thing we do know is that huge numbers of ordinary people have been stung by the banks in the long-running payment protection scandal.
More than £16 billion has been set aside by the banks to pay back customers sold insurance they just didn’t need. There were more than two million PPI complaints in the first half of last year alone – and likely to be thousands more.
What should the politicians learn from all this?
First, we need more action to stop bad behaviour by businesses that we all rely on. It’s consumers who pay when things go wrong – like when we all had to pay to bail out the banks.
Treating people like this is just not good enough.
Whether it is in banking, energy or motoring, consumers are totally fed up.
Confidence in the banking and energy sectors is at an all-time low. Less than a quarter of people say they trust energy companies and less than one in ten think bankers act in their best interests.
More must be done to restore consumer confidence. People need to be treated more fairly. That means cracking down hard on unscrupulous practices and tougher rules to enforce higher standards.
Second, we need a major shake-up of uncompetitive markets dominated by a handful of lazy, inefficient players.
Starting with a big change in banking, so they put customers first, not bankers.
More than half of us have never changed their bank, despite the fact that we could save hundreds of pounds a year in bank charges and credit interest.
And people saved an average of £223 off their annual energy bill just by changing energy company when Which? ran the Big Switch this time last year.
So we need much easier ways for people to switch to get a better deal – whether that’s a bank account or your energy company. It shouldn’t be a gamble or a process that takes weeks.
If we vote with our feet it will put pressure on bad businesses and force them to raise their game for fear of losing so many customers they could go bust.
But it can’t just be down to people power to force companies to change.
Taking action to get a better deal is right. But the system is too often rigged against the consumer. That means changing the law.
People struggle to find the best energy deals because of the huge number of complicated tariffs. The Prime Minister promised to that energy suppliers would have to put their customers on the cheapest tariffs but this does not go far enough.
We need simpler, as well as fairer, bills.
We want a simple, single unit prices for each energy tariff, just like how petrol prices are displayed on the forecourt. This is the only way people will be able to see what is the cheapest possible deal for them.
And in banking, we need to see honesty about charges, a code of conduct and incentives for front-line staff that put the customer first, not sales.
It’s also clear that much more needs to be done by Parliament to restore consumer confidence and help people when their household income is under pressure.
Dodgy practices must not be tolerated, whether from a bank or an energy company.
If they misbehave, the Government and regulators need to step in. They need to be ready to take tough action – from big fines to criminal prosecutions to handing people back the money they’re rightly owed. And the rules of the game must change.
We need to see the Government hand power back to the people.
Only then will consumers start to get a better deal. That will put money back in all our pockets. And that will be good for our fragile economy.

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