- Retailers will be forced to provide up-to-date price information as part of new government scheme to call out rogue supermarkets and stations overcharging drivers at the pump.
- Motorists will be able to easily compare fuel prices in real time to choose the best prices whilst boosting competition and in turn driving down prices.
- Government action after watchdog finds some supermarkets charged drivers 6p more per litre for fuel from 2019 to 2022 - meaning £900m in extra costs across the UK in 2022 alone.
Motorists are being put in the driving seat to find the best fuel prices as the government prepares to force retailers to publicly fess up to how much they are charging at the pump.
In a win for consumers, they will be able to compare prices in real time in any area of the UK, through a new fuel price reporting scheme. Drivers will be able to easily identify those charging fair prices and those failing to pass on savings from falling wholesale costs.
The government will change the law to force retailers to comply by providing up to date price information, which is expected to lead to greater transparency and competition - in turn driving down prices and easing people's cost of living.
The new scheme will make pricing data available for third parties - paving the way for them to create price comparison apps and websites - supporting the digital economy and helping growth.
The tough action by government follows publication of a Competitions and Markets Authority (CMA) report today showing some supermarkets charged drivers 6p more per litre for fuel. This amounts to £900m in extra costs in 2022 alone - around £75m a month.
New powers will be handed to a public organisation yet to be decided, to closely monitor the UK road fuel market, scrutinise prices and alert government if further intervention is needed.
This is the latest step in the government's action to ease the cost of living, as part of its efforts to halve inflation this year - one of the Prime Minister's five priorities. It follows the Chancellor's roundtable with regulators last week, including the CMA, to ensure consumers are being treated fairly and help those struggling to make payments.
Grant Shapps, Energy Security Secretary, said:
Some fuel retailers have been using motorists as cash cows - they jacked up their prices when fuel costs rocketed but failed to pass on savings now costs have fallen.
It cannot be right that at a time when families are struggling with rising living costs, retailers are prioritising their bottom line, putting upwards pressure on inflation and pocketing hundreds of millions of pounds at the expense of hardworking people.
Today I'm putting into action the CMA's recommendations and standing by consumers - we'll shine a light on rip-off retailers to drive down prices and make sure they're held to account by putting into law new powers to increase transparency.
Jeremy Hunt, Chancellor of the Exchequer, said:
It isn't fair that businesses are refusing to pass on lower prices to protect their profits while working people struggle with balancing their budgets.
Consumers need to be treated fairly, and so we're empowering drivers to find the best prices possible for their fuel by taking swift steps following the CMA's recommendations.
The CMA's report found a concerning weakening of competition in the fuel market and an overall increase in retailers' margins, especially in respect of diesel and with supermarkets the worst offenders.
It also noted a lack of reliable and comprehensive price information available to motorists.
The report recommends the mandatory public disclosure of fuel prices and establishment of a body to monitor the market, which the government has agreed to.
The government will consult on the design of the open data scheme, and market monitoring function this autumn - with changes to the law needed to bring it in. In the interim, the CMA will create a voluntary scheme encouraging fuel retailers to share accurate, up-to-date road fuel prices for publication by August and continue to monitor fuel prices using its existing powers.
The move follows a similar scheme in Germany, which boosted competition amongst fuel retailers. Meanwhile, motorists who shopped around in Queensland, Australia, saved on average $93 per year off the back of a statewide scheme rolled out in the area.
Action to protect consumers announced today follows the government spending nearly £40 billion protecting households and businesses from spiralling energy bills over the colder months - including paying half the typical household bill and saving the average home roughly £1,500 by the end of June.
Meanwhile, with the latest Ofgem price cap coming into effect from 1 July, families will see their yearly energy bills fall by around £430 on average. On top of this, the government is also providing additional support to the most vulnerable, with an extra £150 for disabled people and £900 for those on means-tested benefits.
