The recent announcement of electricity tariff rates by the Competition and Consumer Commission has raised alarms among the public, various political entities, and some officials within the Cabinet. This response comes in light of significant concerns regarding the tariff review process, as articulated by former Chairperson of the FCCC, Mahendra Reddy.
Reddy pointed out that any modifications to fees, charges, or tariff rates in regulated industries should adhere to a transparent and inclusive consultation process. He expressed that a consultation conducted a year prior is inadequate, highlighting that economic, social, and cost structures are likely to have evolved over the course of those twelve months. He underscored the importance of incorporating the perspectives of consumer watchdogs and governmental bodies, arguing that a failure to do so could be seen as a violation of the Fiji Competition and Consumer Act 2010.
The governance aspect of the situation also raised eyebrows, especially since the Government, which holds a majority share in the Electricity Fiji Limited (EFL) and has representation on its Board, has reportedly voiced dissatisfaction with the recent tariff changes. Reddy questioned the effectiveness of the guidance being provided to Board members by the relevant Ministers, suggesting that a disconnect may exist in policy direction.
Additionally, Reddy criticized remarks made by the FCCC Chief Executive Officer that hinted at differing opinions among Cabinet members concerning the tariff adjustments. He cautioned that such political statements could potentially compromise the perceived impartiality of the regulatory body.
Reddy emphasized that electricity should be regarded as a public good, given its socio-economic implications, rather than merely a commodity for profit. He proposed that future infrastructure development funding should not overly burden current consumers, advocating for the exploration of capital markets as an alternative avenue, while ensuring that any negative effects on welfare are addressed through targeted government efforts.
This dialogue presents an opportunity for stakeholders to come together and rethink the approach to electricity management, balancing consumer needs with sustainable progress. The call for a more integrated and collaborative process could pave the way for solutions that benefit the broader community while ensuring the integrity of the regulatory framework.
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