Select Committee on Constitution Minutes of Evidence

Examination of Witness (Questions 418-419)




  418. We are grateful to you for finding the time to be with us this afternoon and for putting in a paper in advance of the meeting. It has been extremely helpful and, as you might expect, there are a number of questions we would like to put, on the basis of some of the very interesting points that are incorporated in it. Before we start putting the questions, are there any points that you would like to make before we get underway?
  (Ms Spottiswoode) No, I thought that the questions that were originally asked, around which I based my memorandum, covered everything. The only word of warning is that I have not been a regulator for nearly five years, and I have deliberately kept away from regulation because I do not think it is good to, sort of, sit on your successor. I will certainly base my answers on my experience, therefore, rather than on Ofgem since then.

  419. A number of points you make are of a general nature about regulation, and those are extremely interesting in themselves. Perhaps I could start with some of the earlier points you make in your paper about the appointment of regulators and the structure that is involved. I was quite struck by the point you make about the appointment of regulators, where you write, "Though some have commented to me that I would never have got through a Nolan process. It is sometimes suggested that committees, and particularly Nolan principled ones, tend to `play safe'". In effect, in the paper you question the need to play safe. I therefore wondered how do we go for the non-safe choices. What would be the mechanism? What would you like to see?
  (Ms Spottiswoode) Because I have not been thinking about this for so long, this is something that I only thought about again today. I think there is a way through, which is if we were to have a proper select committee that was dealing with nothing else but utility regulators. One of the key things is to take it out of ministerial control, so you could see it becoming a duty of the select committee to do that process of finding the regulator. If they were really involved with what makes good regulation, they clearly know the kinds of skills required. You could see that kind of mechanism certainly taking it out of politics, but also possibly ensuring that the right skills were brought to bear on the regulators chosen.

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