Cap not fit for purpose

AT first glance the cap on energy bills should be welcome.

In the New Year 11 million people on default tariffs will be better off by an average £75 a year. This action is long overdue after years of the big six energy firms ripping off customers.

The Competition and Markets Authority found they were making £2billion a year from overcharging. While any step taken to give customers a fairer deal is appreciated the watchdog and the Government could have – and should have –gone further.

Theresa May originally suggested as many as 17 million would benefit. And the limit on bills imposed by Ofgem of £1,136 a year is higher than the £1,000 promised by Labour.

There is also a fear households will be lulled into thinking they are getting a good deal when they could save more money by switching.

We need a fundamental reform of the energy market that smashes the control of the Big Six and ends the complex system of tariffs and variable rates that bamboozle customers and allows firms to make excess profits on the sly.