Government must block Npower-SSE merger, says GMB

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The Government is being urged to block the planned merger of two energy companies over fears it would lead to a “cartel” and hit competition and jobs.

The GMB union said the proposed deal between Npower and SSE would be bad for consumers as well as workers.

The union has written to Business Secretary Greg Clark saying the planned merger meets the criteria for being referred to the Competition and Markets Authority.

If it is not referred, the Government should use its powers under the Enterprise Act to block the merger on the grounds of public interest, said the GMB.

National officer Justin Bowden said: “This is an obviously worrying time for SSE and Npower employees who will be concerned that job cuts will inevitably follow a merger.

“However, any merger should also be a worrying development for the Government. The creation of a Big Five will only exacerbate a situation that is already failing consumers and reduce further what little competition currently exists.

“Should the merger be allowed to proceed, then it will lead to the ‘cartelisation’ of a market that will be without competition, effective oversight or strong central direction.

“We are at a genuine crossroads in terms of the UK’s future direction for its energy strategy and policy for at least a generation to come.

“The merger between SSE and Npower is a test of that duty and until there is a settled energy policy, we risk a private cartel if the merger is given approval.”

A Business Department spokesman said: “We remain committed to tackling the cost of consumers’ energy bills.

“Despite there being more than 60 energy suppliers in the market, most consumers are still not feeling the benefits of this increase in competition and we have published a draft bill to cap poor-value tariffs to address this.

“We are aware of the decision by SSE and Npower to merge their retail customer businesses. The independent Competition and Markets Authority is the watchdog with oversight of mergers.”