Chancellor agrees action plan with consumer watchdogs to crack down on 'profiteering' retailers

The chief executive of the Financial Conduct Authority tells ITV News he is 'looking closely' at the issue of savers not seeing higher interest rates

Chancellor Jeremy Hunt has agreed a deal with consumer regulators who will "act urgently" and "keep a watchful eye" on companies accused of profiteering from the cost of living crisis.

The chancellor hosted a meeting in No. 11 Downing Street on Wednesday with the regulators for energy, water and communications, and the Competition and Markets Authority (CMA).

Mr Hunt scrutinised the executives on what they can do to crackdown on a so-called profiteering problem, after the Bank of England suggested some retailers are either raising prices or not passing on easing wholesale costs to their customers.

The Financial Conduct Authority has agreed to report by the end of July on how higher interest rates are being passed on to savers, while the water regulator Ofwat has promised to crack down on water companies not doing enough to help customers pay their bills.

The Competition and Markets Authority (CMA), a competition watchdog, also said it will deliver a better deal for motorists by publishing a review of fuel pricing on Monday.

The authority said it will look at affordability pressures in the housing market and provide an update on their housebuilding market study, and work in the rental sector, in August.

On Tuesday, ITV News reported that millions of private renters on low incomes are being priced out of the housing market, as data from Crisis and Zoopla shows just 4% of homes are affordable.

Following on from the meeting, the CMA also said it will further scrutinise the food supply chain and bring forward their update of competition and unit pricing in the grocery sector to earlier in July.

On Tuesday, supermarket bosses denied claims they are making eye-watering profits from the cost of living crisis, with a senior executive from Tesco telling MPs it is the "most competitive" they have ever been.

While it is uncertain the effect the action plan will have on prices on supermarket shelves, the CMA's CEO Sarah Cardell said: "As rising inflation continues to put pressure on household and business budgets, the CMA is unrelenting in its commitment to promote open and competitive markets, and ensure consumers can shop around effectively for the best deals.

"We will continue to invest heavily in scrutinising issues economy-wide, to make sure we invest our resources in those areas that matter most."

In a statement, Mr Hunt said: "I am pleased we’ve secured agreement with the regulators to act urgently in areas where consumers need most support to ensure they are treated fairly. “We are working hard to halve inflation this year and return to the 2 percent target. Businesses must play their part too and I will keep a watchful eye on the progress they make.”

Communications regulator Ofcom has also promised to do more to make consumers aware of different social tariffs and how they can save money.

Dame Melanie Dawes said Ofcom has "put pressure" on providers to offer social tariffs, but that is only "half the job".

In a statement after Wednesday's meeting, she said: "It's not enough to expect people to find out about these by themselves - providers must act now to make sure customers know what support is available.

"Ofcom will be urging telecoms firms to take immediate steps to raise awareness of social tariffs and drive consumer take-up, and will work with government and other relevant bodies to support industry efforts."

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