The Financial Conduct Authority is intended be a “value for money” regulator but it will not regulate prices.
Last week’s guidance confirms the FCA will not directly regulate prices but will try to spot potential consumer detriment and flaws in competition by looking at “comparative prices”.
It says: “We expect the FCA will take a keener and more informed interest in questions of value for money than the FSA has done.”
The regulator could intervene to prevent misleading price structures where low headline prices used to attract new customers are offset by “unreasonable” surcharges. But it adds: “Such intervention is expected to be rare.”
The Treasury’s guidance says: “The Government confirms the FCA will not prescribe prices in the manner of some utilities’ regulators. In the absence of natural monopolies or similar conditions, such an approach would not be proportionate with its competition remit.”