For millions of consumers across the UK, the findings in this week’s report from the National Audit Office (NAO) would have come as no surprise. Faced with rising costs – resulting for many in rising debt levels – consumers are feeling the pinch in their pockets and an overwhelming feeling they are getting ripped off.

The NAO was clear: the UK’s regulators (Ofwat, Ofgem, Ofcom and the FCA) need to do more to prove they are offering enough protection to those consumers that need it most. According to the NAO, there is a 70% increased likelihood of consumers in deprived areas using unarranged overdrafts. This alarming rise is no surprise as between 2007 and 2018, there was a 28%–37% real-terms increase in average gas and electricity prices.

A combination of high prices and poor customer service has severed trust across a number of consumer markets, and there is seemingly no silver bullet to remedy the lack of confidence. In the energy market, Ofgem’s latest market report noted that consumers continue to be feel let down by poor customer service from suppliers. The outlook is similarly bleak in the water industry, as only last summer, Ofwat criticised water companies for their financial structures and top executive pay, claiming they had damaged customer trust.

Labour believes these failings are down to the fact that regulators have limited ability to protect consumer interests. In their eyes, private companies can maximise profits at the expense of bill payers, without being kept in check by regulators. In response, Labour wants to fundamentally reform the regulatory system – and in the water industry absorb Ofwat into the Department for Environment, Food and Rural Affairs to create a National Water Agency. While this would give government greater oversight of the way the market operates, it would represent a large shift from existing government policy.

It would be unfair to say the government has not sought to reform consumer markets. The introduction of the energy price cap, a temporary rather than permanent solution was supposed to help reduce consumer bills by limiting the price a supplier can charge per kWh of electricity and gas used. However, around 11 million households are set to see their bills increase by an average of £117 per year after Ofgem hiked the price cap due to higher wholesale gas and electricity prices.

Clearly the price cap isn’t a long-term solution and Ofgem are considering several measures to drive competitiveness in the energy market. To start with, they are in the process of developing a Consumer Vulnerability Strategy which is set to be launched in the spring. The Strategy will guide Ofgem’s understanding of vulnerability and guide expectations of the types of services that should be offered to consumers with different needs. Alongside this, Ofgem have been instructed by the Competition and Markets Authority to develop a database of disengaged customers, which includes 8 million people that have been on the standard variable tariff with the same supplier for over three years. Encouraging these consumers to change supplier will go a long way to addressing disengagement in the market – helping consumers save money.

In the face of rising prices and dissatisfaction across a range of markets, regulators are faced with the unenviable task of finding solutions with limited resources. The ongoing debate surrounds whether regulators need fundamental reform or incremental change to deliver better consumer outcomes and in the end it’s likely that future change will be driven by a combination of the both. The National Infrastructure Commission’s ongoing review into regulators placing them firmly under the microscope, meaning they will need to show their value and worth to consumers. In the short term, regulators will hope that the existing measures they have to jump start engagement help to place power back in the hands of consumers.