Based at the University of East Anglia, the Centre for Competition Policy incorporates economic, legal, management, political science and sociological perspectives to produce inter-disciplinary research into competition policy and regulation that has real-world policy relevance, without compromising academic rigour.
Members include academic staff, researchers and PhD students drawn from the School of Economics, UEA Law School, Norwich Business School and the School of Politics, Philosophy, Language and Communication Studies. All have a wide range of knowledge and interest within the field of competition policy and regulation, and maintain the centre’s founding belief that a properly regulated, competitive market can provide consumers with the products they want at the best possible prices. Read more
New CERRE study by CCP says policies need to be revisited to keep utilities’ services affordable.
A new CERRE study on the affordability of utilities, co-authored by the Centre for Competition Policy’s Professor Catherine Waddams and Dr David Deller, has found that whilst it is clear that the economic crisis has impacted on many EU citizens ability to pay their bills, there is no easy fix to solve these affordability concerns.
In the EU four utility sectors (energy, water, telecoms and transport) account for 20% of households’ expenditure on average. Utility affordability is a major issue on European policy agendas and the study moves the debate forward by arguing that a one-size-fits all solution would not work due to affordability differing widely between old and new member states.
“We found stark differences in affordability challenges both between old and new Member States and between different utilities, indicating that a single European solution is unlikely to work,” explains Professor Catherine Waddams, Joint Academic Director of CERRE. “Nevertheless, greater sharing of experiences and knowledge is likely to be beneficial. Also, we caution against using high-level affordability metrics as targets to assess policy success since this can give rise to perverse incentives.”
The study is the first time such a wide of variety of data has been used and combines extensive country and household-level data analysis with literature reviews and stakeholder interviews. Drawing on the unique opportunities offered by CERRE to explore policy options across the utility sectors and the European Union, the core findings and recommendations were:
- Affordability issues vary widely, in type, in extent, between sectors and across Member States. Differences between ‘old’ and ‘new’ Member States are particularly stark. Consequently, policies to address these issues vary – and should continue to vary – across Member States. Local knowledge is crucial to the successful implementation of policies.
- However, Member States could benefit from enhanced information and experience sharing, including a centralised repository of information and statistics about affordability issues in different sectors across the EU.
- The measurement of affordability difficulties is critically important. Some commonly used metrics may lead to the pursuit of inappropriate policy options or to targeting efforts at those who are easy to help, over those who need most help.
- To maximise results and avoid ineffective or inefficient programmes, policy choices must be based on realistic forecasts of individual behaviour and household response.
Professor Bruno Liebhaberg, Director General of CERRE, says: “In the wake of the economic difficulties affecting many Europeans, the significance and added value of this CERRE study stem not only from the latter's in-depth examination of the extent of the affordability challenges but also from its assessment of the true effectiveness of a wide variety of existing policies put in place to deal with the problem as well as from its recommendations for the future”.
Read the full report here.