Call to end delay in abolishing monopoly in gas

THE Consumers Association and independent gas companies are calling for government action to abolish the British Gas monopoly over domestic customers and allow consumers the benefit of competition.

They accused British Gas of scaremongering about price rises and regional differentials in prices in the event of competition in the marketplace. The CA said 'squealing' by a company that wanted to protect its dominant status should not be allowed to derail government plans to introduce competition in 1996, with the market opening fully in 1998.

It recently emerged that legislation to introduce competition had slipped from the legislative timetable and is not included in the next Queen's Speech. A Cabinet committee is expected to discuss the regulated utilities within the next few weeks.

The CA said: 'Fears are growing that the Government is set to abandon its avowed intention to abolish British Gas's monopoly. To do so would make a mockery of the Citizen's Charter commitment to increase choice and competition in public services wherever possible.' It has written to Michael Heseltine, President of the Board of Trade, urging him to allow no delay in introducing benefits for consumers in price and standards of service.

Utilicorp, one of the largest independent gas suppliers, said British Gas scaremongering on prices had confused ministers and backbench MPs and was in danger of stopping competition in its tracks.

Peter Bryant, deputy chairman, said most gas suppliers would pull out of Britain if they thought the Government had reneged on its commitment to competition in the domestic market.

In a fully competitive market consumers could see bills fall 12 per cent, about pounds 27 off the average annual household gas bill. Businesses that can already choose an alternative supplier to British Gas are seeing savings of up to 20 per cent.

Cedric Brown, chief executive of British Gas, said legislation was the key to an orderly competitive market.