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Sir John Bourn, Head of the National Audit Office, told Parliament today that Energywatch and Postwatch have achieved benefits for consumers but they need to do more to show the extent of these benefits. Over their first three years, Energywatch and Postwatch have successfully established their organisations, developed efficient systems to handle customer complaints and sought to address major consumer problems in the energy and postal sectors. But today’s report highlights that there is scope to increase and demonstrate more clearly those benefits, and reduce costs.

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Energywatch and Postwatch’s biggest single task has been to investigate complaints referred by consumers who are not satisfied with their service provider’s response. In 2003-04 Energywatch received 87,600 complaints, showing that consumers faced problems with the accuracy and timeliness of their bills, and the process of switching supplier. Postwatch received 27,500 complaints, showing particular problems with lost mail and mis-delivery. Both have developed efficient systems for handling complaints and have added value for consumers. However, neither body evaluates the consumer benefit from this work in a systematic manner, such as the level of compensation achieved.

Energywatch and Postwatch have no regulatory powers and have to rely on influence to affect the decisions of service providers, the sector regulators and government. Each has sought to address the major issues faced by consumers in the energy and postal markets; for example, Energywatch has campaigned to eradicate selling malpractices and Postwatch has reviewed the Government’s programme to reduce the number of urban post offices. However, neither has undertaken a comprehensive analysis of consumer needs, or the factors which influence consumer behaviour. As a result, there is a risk of failing to focus on all of the important areas for consumers and particular sub-groups such as the elderly or low income groups, or the needs of small businesses.

In their first three years, Energywatch has spent £57 million, including £12 million on closing down its predecessor bodies. Postwatch has spent £27 million. There is scope to reduce annual running costs; for example, by sharing the provision of administrative and support functions between consumer bodies. Energywatch and Postwatch have a network of regional offices and today’s report encourages them to evaluate whether the benefits of consumer representation in the regions could be achieved at a lower cost.

"I applaud the efforts of Energywatch and Postwatch to protect and speak up for consumers. It is important now that these bodies seek to evaluate their impact more fully to learn lessons for their future. I am encouraged that they have adopted a positive response to the recommendations and are taking action to improve their performance."

Sir John Bourn


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