Recommendation 14

HM Government · verbatim extract Accepted

Responses to the Committee’s Third Report of Session 2022–23 5 Ofgem has recognised how its regulatory approach over the latest 18 months has contributed to supplier failure and the related issues within the energy supply market and is taking active efforts to ensure that the supply market is more robust going forward to ensure we don’t see a repeat of the recent issues. This includes through commissioning an independent review into the root causes of the recent supplier failures and specifically, into how regulation of the industry played a part. Additionally, on 8 September, the government announced it will consider undertaking fundamental reforms to the structure and regulation of the energy market through recommendations from a new Review of UK Energy Regulation. BEIS does not have a formal role in addressing Ofgem’s performance; Ofgem instead answers directly to Parliament for the performance of its statutory duties. However, Ofgem and BEIS provide quarterly reports to BEIS’ Performance & Risk (P&R) Committee, a delegated committee of BEIS’ Executive Committee. The P&R Committee scrutinises Ofgem’s performance and delivery of programme and policy commitments. BEIS and Ofgem also regularly engage at both a senior and working level to work towards common objectives and be alert to risks. These engagements include, but are not limited to, frequent meetings between Ofgem and the Secretary of State, and meetings between Ofgem and the Director General for Energy & Security. BEIS is currently working with Ofgem to review and update the joint BEIS-Ofgem framework document. This will be done in line with Managing Public Money guidance, and we intend to publish this in due course.