Low Paid Take Full Advantage Of Gas Competition

Low income consumers in the D and E social groups are taking full advantage of gas competition and are therefore not being excluded from the competitive market, according to a MORI report published by Ofgas today.

The wide-ranging report, which was funded by Ofgas and the National Audit Office, looks at all aspects of gas competition throughout the England Scotland and Wales.

"One of the most striking findings when considering the profile of switchers is the slightly higher proportion that are Des (32%) compared with the proportion of Des in the whole population (30%), "the report says "This compares with a smaller proportion of ABs (14%) than the population as a whole (19%) and provides evidence that the lower income groups now have a slightly higher tendency to switch than the higher income groups."

The survey found that while the majority of people say the level of service from their gas supplier remains the same, of the remainder, more feel the quality of service has improved rather than got worse.

Most people switched because of cheaper prices and 88 per cent found it easy to do so, the report says. Of those people who have not switched, 16 per cent say they would consider doing so in the next three years.

The survey found that 95 per cent of consumers were aware that gas competition had been introduced and 58 per cent said they felt informed about the changes.

Doorstep selling seems to be an effective method of communication with gas customers, particularly for those customers in lower income groups. Of those contacted by a doorstep salesman, 57 per cent found it informative as opposed to 31 per cent who did not.

The survey showed that there are still several areas of possible concern such as the need for consumers to be better informed, including awareness of, and how to compare the different gas prices.

Copies of the document Gas Competition Review: August 1998 A research study conducted by MORI for the National Audit Office and Ofgas are available from: Ofgas Distribution Centre, 3 Tigers Road, Wigston, Leicestershire, LE18 4UX. t: 0116-277 2617

Technical details

The MORI study, which took place in July/August this year, involved 2,511 face-to-face interviews with gas customers in England, Wales and Scotland. Quotas were set by work status, age and social group. The proportion of switchers, Scottish households and lower incomes areas in the sample were boosted to allow for separate analysis. Final data were weighted to reflect the known profile of gas customers in England, Wales and Scotland by work status, age, social group and switchers versus non-switchers.

The study was jointly commissioned by Ofgas and the National Audit Office which has the responsibility of reporting to Parliament whether Ofgas is delivering maximum value for money as the industry regulator.

The National Audit Office is examining further the issues raised in the survey and would welcome comments on the survey and its findings from interested parties. Comments to the National Audit Office should be addressed to: Michael Whitehouse, National Audit Office, 157-197 Buckingham Palace Road, London SW1W 9SP, by 4 December 1998.