Press release
A new system that will better protect consumers comes into effect this week: From 1 October:
* Consumer Focus will be formed through the merger of the National Consumer Council, energywatch and Postwatch. The new body will be a more powerful consumer champion, with much stronger powers than its predecessors - including the ability to demand information from companies.
* Energy and post companies will have to take greater responsibility for resolving customers' complaints. The regulators, Ofgem and Postcomm, will now fine companies who fail to meet tough new standards. They will also announce how well companies are handling complaints - giving those that perform the best a competitive advantage
* If companies and consumers can't reach agreement on complaints a new independent ombudsman will step in. The ombudsman will be free for consumers, but companies will have to pay hundreds of pounds for every case that reaches this stage. Unlike energywatch and postwatch, the redress schemes have the legal power to enforce resolution and award compensation for consumers.
* Consumer Direct, the Government funded advice service, will now give consumers information and practical advice on energy and postal issues. It can be contacted on 08454 04 05 06 or by visiting www.consumerdirect.gov.uk
Business Secretary John Hutton said: "These changes will help consumers get a better deal. One single body, rather than three, means a stronger voice holding business and Government to account. It means a more joined up approach to tackling problems.
"Energy and post companies will have to take greater responsibility for handling complaints or face significant fines. And where complaints can't be resolved voluntarily, new redress schemes give the system teeth."
Ed Mayo, Chief Executive of Consumer Focus, said: "There could not be a more appropriate time to launch a new, more powerful consumer champion and to improve complaints handling. Current economic conditions are tough and consumers are telling us that value for money is their number one concern.
"The creation of Consumer Focus, a new kind of campaigner, is a once-in-a-generation opportunity to put consumers at the heart of business and government decision-making. We will campaign for a fair deal for consumers, because if consumers are confident then everybody, including families, business and the economy, benefits."
