Poor suffering from private service provision, claims charity
A leading consumer charity has warned that the drive to involve the private sector in public service provision is harming the interests of the poor.
According to a new report from the National Consumer Council (NCC), the financially disadvantaged end up paying more or receiving less from essential services like credit, health and utilities.
It claims that the privatisation of “essential services” such as telecommunications, water and electricity has left many poor consumers paying more because suppliers consider them a higher risk.
It quotes a number of key statistics, including the claim that one million fuel-poor consumers pay more for their electricity and water using pre-payment meters than they would do by direct debit.
The NCC also points out that the move towards paying benefits directly into bank accounts also disadvantages those people who are unable to access bank accounts and financial services.
They are calling on the Government to develop a “consistent strategic approach to achieving universal access to essential goods and services provided by the private sector.”
“Lack of money isn’t the only problem with being poor,” says the NCC chair, Deirdre Hutton.
“They face a double disadvantage. The poor pay more because life on a cash budget is more expensive. And if you can’t get around because of a disability or limited transport, you can’t shop around for the best deal.”
She adds: “Our dossier is a call to action against market exclusion – a call we hope will have a positive impact on the lives of at least half a million disadvantaged consumers over three years.”
Ms Hutton continued: “While new technology can be a cost-saver for business – and some consumers – it can raise further barriers for customers who lack confidence or basic skills.
“Increasing market complexity – mobile phone packages and more choice of energy suppliers for instance – is another trend that excludes disadvantaged groups.”
It suggests that the Government should make the social responsibilities of suppliers clear and enforce them more rigorously and to appoint an independent commission to assess which services are “essential” and to develop a strategic view of how to address un-met needs and protect the disadvantaged.
