Competition and Regulation
How can markets be made to function in the best interests of consumers and citizens? Are there any limits to the expansion of markets in the provision of public services? Is too much regulation stifling growth?
The onset of difficult economic conditions has posed important questions about the way in which markets work. But market reform issues determine how a country functions and shapes the society we live in. From the price we pay for our heating, to the financial products we can buy, to how we run our schools and hospitals. We all have a stake in the answers.
We have significant experience in providing advice across regulated sectors to both regulators and regulated entities. From working closely with regulators, we can advise on the strategic and operational issues that they consider particularly important. Amongst the services that we can offer you are:
Regulatory strategy and price controls:
We have extensive experience in advising policy makers on sector policy, as well as the development of implementation strategies, including setting targets and proposing monitoring mechanisms. Implementation of a proposed policy may involve the formulation of suitable regulations to govern the relevant areas of a sector, such as access regulation, regulated pricing, tariff modelling and design.
Regulatory impact assessment:
We have extensive market reform experience, including cost benefit assessments of regulatory proposals. We have our own methodology for assessing economic, social environmental and fiscal impacts which aligns with the regulatory impact assessment standards of the regulators.
Regulators and competition authorities perform assessments of profitability when considering whether competition is effective. In this context we have extensive experience in analysing data and applying relevant adjustments to calculate the actual and competitive benchmark levels of economic profitability. We use an established approach of making adjustments to accounting figures in order to obtain reliable economic profit estimates.
Efficiency and cost benchmarking:
Within sectors and across sectors, using a range of techniques. In addition to our team of analysts, we can draw on a range of individuals who are have expertise in relevant aspects of regulated sectors.
Our team provides practical, evidence based solutions that combine traditional financial economics with strong quantitative skills, fluency in finance, and in-depth industry expertise, to provide expert analysis, evidence and testimony. We work with our clients to help them:
● Work out the cost of capital and appropriate investment hurdle rates
● Value businesses more accurately
● Understand and price risks more effectively