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Independence can benefit consumers and businesses by strengthening and streamlining economic and competition regulation in areas such as energy and postal services, Finance Secretary John Swinney has said yesterday.

Mr Swinney has unveiled a discussion paper on regulation to business leaders in Stirling.

The document suggests that instead of the UK’s six different economic and competition regulatory bodies, an independent Scotland could deliver more effective and efficient regulation as well as a better service to consumers by combining their functions into one or two organisations.

These bodies would regulate the energy, telecommunications, postal services, water and rail sectors as well as issues around competition in commercial markets. 

The UK’s approach to regulation has come under fire for failing to properly address concerns over energy prices, broadband availability and delivery charges.

The Finance Secretary highlighted Scotland’s devolved water industry as an example of what can be achieved when Scotland has full powers over the regulatory framework.

The average household bill for water services in Scotland is now more than £50 cheaper than in England or Wales and standards are at their highest ever level.

Mr Swinney also outlined how better regulation promotes competitiveness by reducing burdens on our businesses.

He said:

“Regulation has a vital role to play in Scotland’s economy.

“We must have regulators with the teeth to serve consumers and businesses properly.

“There is growing evidence that the current UK regulatory framework does not adequately reflect Scottish priorities. 

“With independence we can take the opportunity to deliver a better service making it simpler for business and offering proper protection to consumers by combining the UK’s six economic regulators into just one or two.

“The regulatory framework in Scotland has allowed us to keep water charges down, below those in England and Wales, by acting in Scotland for Scotland’s best interests. In contrast, in the energy sector much more needs to be done to protect households from energy price rises through a greater focus on energy efficiency and tackling fuel poverty.

“Similarly the UK regulatory framework has not protected consumers from the unreasonably high postal delivery charges in the Highlands or incentivised better broadband and mobile telecoms provision for all of Scotland.

“This paper outlines a streamlined system of regulation that addresses Scotland’s needs.

“Instead of simply replicating UK organisations with independence we can make sure we have systems that are the right size and offer the right services for Scotland.

“The benefits of our proposed approach will extend across all sectors.  Industry will have fewer regulatory bodies to deal with, consumers could have a single port of call for their concerns and there will be greater stability and consistency in regulatory decisions.

“A combined regulatory body will use resources more effectively and flexibly, creating savings for the public purse. It will provide a single and stronger voice on competition and economic regulation and raise Scotland’s profile on these issues on the international stage.”

Related information

•  Economic and Competition Regulation in an Independent Scotland publication