Some notes about Regulation

The British regulatory model is an evolving one. It started out as a reaction against both the nationalised industry controls and the perceived failures of US rate of return regulation. In the mid-1980s, the zeitgeist was one of markets, liberalisation, competition and private ownership. RPI-X was invented as a deliberately simple and temporary way to mimic the market, but only for so long as it took for competition to do away with the need for regulation at all. This applied to BT in 1984; it was expected to wither away after seven years.

In practice regulation has gradually morphed into a detailed and permanent set of interventions for the core monopoly infrastructures. It now controls price and outputs, and it has developed techniques to address the asset bases, the cost of capital, the operating efficiency and capital expenditure.

Regulation, built in this piecemeal way, has become heterogeneous. Each regulator has followed a specific path. OFGEM pioneered RIIO, with eight-year periods, whilst OFWAT sticks to five-year ones. OFGEM has indexed the cost of debt. ORR has had to accommodate a much greater role for the state, whilst OFCOM has struggled with the emerging universal service obligation (USO) for broadband. Large infrastructure projects have attracted their own unique contractual frameworks. Hence the detail matters, as is explored in each part below.







Latest Publication

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Luck is not an energy policy – the cost of energy, the price cap and what to do about it

December 6, 2021

Regulation Publication

With energy prices set to rise even further, a look at how the recommendations from the 2017 Cost of Energy Review, if implemented at the time, could have prevented the current crisis.


  • Publication Regulation The Case for Regulatory Reform
    July 31, 2005

    In D. Helm (ed.), The Future of Infrastructure Regulation, published by Oxera, July 2005, pp. 1-9. It is tempting to think that, after two decades of experience, regulation might have moved from the controversial and novel, to the tried and tested, that c
  • Publication Infrastructure The Future of Infrastructure Regulation
    July 31, 2005

    Edited by Dieter Helm, published July 2005 by Oxera. Based on the speeches of regulators and companies in the infrastructure and utilities industries, presented at the Oxera conference, The Future of Infrastructure Regulation, on March 1st 2005, this volu
  • Publication Communications House of Lords Select Committee on the BBC Charter Review Evidence
    July 5, 2005

    Minutes of Evidence Taken Before the House of Lords Select Committee on the BBC Charter Review, July 5th 2005.
  • Publication Communications Consumers, Citizens and members: Public Service Broadcasting and the BBC
    January 21, 2005

    Dieter Helm's chapter from the BBC book 'Can the Market Deliver? Funding Public Service Television in the Digital Age', published January 2005 by John Libbey Publishing, pp. 1-21.
  • Publication Regulation The new regulatory agenda
    January 1, 2004

    Published by the Social Market Foundation, January 2004. Regulation in Britain has grown gradually and continuously since the privatisations of the 1980s and 1990s. Its growth has been unplanned, but has now reached a critical mass, attracting widespread
  • Publication Transport DTI Transport committee inquiry into The Future of the Railways
    September 10, 2003

    The government set out a new direction for transport policy in its integrated transport strategy White Paper, 'A New Deal for Transport: Better for Everyone', published in July 1998. This was followed by the 'Ten Year Plan'. A new era for the railways exp
  • Publication Transport Inquiry into Passenger Rail Franchising and the Future of Railways Infrastructure
    March 8, 2002

    Memorandum of Evidence submitted to the House of Commons Inquiry into Passenger Rail Franchising and the Future of Railway Infrastructure. This memorandum reviews the reasons for the failure of the Strategy Rail Authority's (SRA) refranchising strategy, c
  • Publication Regulation Making Britain more cometitive: A critique of Competition and Regulatory policy
    November 1, 2001

    Royal Bank of Scotland/Scottish Economic Society Seventh Annual Lecture. Published in Scottish Journal of Political Economy, 48 (5), 471-487. This paper provides a critique of the Labour government's attempts to make Britain more competitive by reforming
  • Publication Communications Review of the DTI's Structure, Priorities and Business Support
    September 21, 2001

    DTI carries out one of the widest ranges of functions of any Whitehall department. Most of these span across British industry (and hence can be considered as 'horizontal' functions). Others are industry or sector-specific (and are therefore 'vertical' fun
  • Publication Transport Transport Sub-committee Inquiry into Passenger Rail Franchising
    September 13, 2001

    This memorandum reviews the reasons for the failure of the Strategy Rail Authority's (SRA) refranchising strategy, comments on the Department of Transport, Local Government and the Regions' (DTLR) draft policy statement, and, in the light of the decision
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