Small Businesses: Ofcom and Ofgem

(asked on 5th March 2020) - View Source

Question to the Department for Business, Energy and Industrial Strategy:

To ask the Secretary of State for Business, Energy and Industrial Strategy, whether the Government has plans to encourage (a) Ofgem and (b) Ofcom to cooperate on producing guidance for best practice in their dealings with SMEs operating in the (i) energy, (ii) communications and (iii) other sectors.


Answered by
Kwasi Kwarteng Portrait
Kwasi Kwarteng
This question was answered on 12th March 2020

The Government wants all consumers to pay a fair price for their energy. In 2019 Ofgem launched a Strategic Review of the Microbusiness Retail Market to better understand the customer journey for microbusinesses and consider what solutions may be necessary to safeguard them as consumers. The regulator plans to publish a consultation this spring setting out its detailed policy solutions in response to the Review’s findings.

Microbusinesses display similar characteristics to domestic consumers when buying energy. Therefore, where they have exhausted their energy company’s own complaints procedure, businesses with up to 10 employees can make a complaint to the Ombudsman Services: Energy.

Larger businesses are more likely to be able to effectively procure their energy supply, as they procure other commodities for their businesses.


The Communications Act 2003 places a duty on Ofcom to ensure that Alternative Dispute Resolution (ADR) procedures are available for domestic and small business customers (defined as up to 10 employees). All communications providers must be a member of an approved scheme, Ofcom currently approves two ADR Schemes: Ombudsman Services: Communications (OS) and the Communications and Internet Services Adjudication Scheme (CISAS).

In 2019 Ofcom published an independent review of the two approved ADR schemes. The review found that both schemes show a high level of decision-making accuracy with regard to case acceptance or rejection, and Ofcom is satisfied that both ADR Schemes are following the requirements set out in the ADR regulations and the Communications Act.

It is for Ofgem and Ofcom to review the evidence and to work with Government to determine whether further regulatory intervention, or other steps, are necessary to assist SMEs.

Though there are currently no plans to offer joint guidance between Ofcom, Ofgem and the FCA, they continue to cooperate on dealing with issues affecting SMEs in their respective sectors.

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