The husband of TalkTalk chief executive Dido Harding has issued a call for widespread deregulation – including cheaper access to the BT network by competing ISPs.
MP John Penrose’s neo-Thatcherite call for less regulation across utilities like electricity, water, banks and broadband sets him at odds with his wife’s current campaigning.
Harding is engaged in a war of words with BT bosses over TalkTalk’s demands for media regulator Ofcom to control the price of BT Openreach’s fibre broadband products.
Penrose’s paper – disingenuously titled We Deserve Better – calls for smaller regulators and ‘structural reforms’ such as breaking up monopolies like BT and its Openreach network division.
Penrose, Conservative MP for Weston-super-Mare, writes: “Some firms, like the ones which provide our food, clothes and TV, produce products which we like, and rate highly.
“But others – like energy, water, banks and broadband – make us feel ripped off and we consistently give them rock-bottom scores on everything from value for money to quality of service and overall customer satisfaction.
“Much of this industry [telecoms] is competitive already, so the principle remaining opportunities would come from a simpler and easier switching process to allow fixed and mobile customers to move to whichever firm was offering the most competitive deal; and from ensuring cheaper, equal access to the network monopoly in BT Openreach for the broadband companies – including the rest of BT itself – which use it to supply their customers.”
Penrose’s broad vision is to move from a ‘Big Regulator’ model which he claims stifles innovation and focusses more in the industry than consumers, to a ‘Big Consumer’ approach which makes permanent changes such as breaking up monopolies or forcing them open to competition.
A structural reform, for example, would break BT Openreach away from BT Group – as Ofcom considered in the 2000s – than to regulate its prices as Ofcom does today.
Major proposals include allowing water companies to compete in the same way as gas or electricity, removing regional railway monopolies, and allowing bank customers to ‘own’ their account number like a phone number so they can switch between banks more easily.
All good ideas, but Penrose’s potted history of British utilities and their regulators has a few glaring errors, such as claiming Ofcom replaced Oftel 2003.
It did, of course, but it also replaced the Independent Television Commission and the Radiocommunications Agency, saving millions of Pounds in admin costs.
Penrose’s white paper isn’t official policy, but it suggests the first step would for ministers to publish a list of structural changes that would minimise the need for regulations.
“This could, in some industries, require fundamental and radical changes to the firms which own or run the monopolies so, as before, the reform programmes will have to be agreed by a ‘star chamber’ of senior Ministers, who will challenge the proposals of the regulators and their sponsoring Departments, and demand changes if they don’t go far enough,” Penrose adds.
What’s left of the regulators would be responsible for considering further structural changes to promote competition, instead of imposing regulations – or only imposing regulations which ‘mimic or promote competition’.
John Penrose’s paper will be deabated at the Regulatory Policy Institute Conference, ‘The Future of Independent Regulation’ at One Great George Street, Westminster, tomorrow (Friday, April 26).
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