§ Bob Russell
To ask the Secretary of State for Trade and Industry what representations she has received about energy providers poaching domestic customers from other companies; and if she will make a statement. 
§ Mr. Wilson
I have received a large number of representations about domestic gas and electricity competition. A competitive market requires consumers to have access to offers from a number of suppliers, to be able to compare those offers and to be able to transfer between suppliers to make financial savings or gain improved service. It is also entirely legitimate that suppliers should promote their offers. The vast majority of contracts between suppliers and consumers are carried out in an appropriate manner, to the advantage of both. Since competition was fully introduced 14 million customers have benefited from greater choice and reduced energy prices by switching suppliers, and new entrants have been able to join the market.
It is important that consumers have confidence in the competitive market, and that problems that serve to weaken that market and cause distress to consumers be addressed. The problems raised in the representations made to me chiefly surround the erroneous transfer of gas and electricity supply, whether by administrative or data error or dishonest sales practice. It is the responsibility of the industry regulator, the Office of Gas and Electricity Markets (Ofgem), to oversee competition as a whole, and to monitor and address suppliers' performance and compliance with the range of statutory and regulatory instruments.
To reduce erroneous transfers, Ofgem and the Gas and Electricity Consumer Council— Energywatch— have developed the Erroneous Transfer Customer Charter. All domestic gas and electricity suppliers have accepted this charter, which came into force on 1 January. The charter should ensure that consumers transferred in error are restored to their original supplier swiftly, and with the minimum of inconvenience. Ofgem will review the industry's response to the charter in August 2002. If it feels that the response has been inadequate, or that insufficient progress has been made, it will consider the use of regulatory measures. These include the imposition of standards of performance (which can carry requirements for automatic compensation) and the modification of supply licence conditions. Ofgem will shortly also have the powers to levy financial penalties on companies for breach of licence conditions.
In addition, in November 2001, I wrote to all gas and electricity suppliers to express my support for the charter, and to stress the need for all suppliers to eradicate sales malpractices, which cause distress and inconvenience to consumers and bring the competitive market into disrepute. I made it clear that, if the problems surrounding sales malpractices were not dealt with, we would have to look again at how best consumers could he protected.382W