Competition

Competition is an important driver of productivity performance.  Vigorous competition strengthens incentives to innovate and ensures that resources are allocated to the most efficient firms.  By encouraging firms to reduce prices and improve the quality and choice of goods and services, it is also the most effective way of ensuring that consumers receive a fair deal.

The Government is committed to strengthening the UK’s overall competition regime.  Productivity and Enterprise: A world class competition regime, published by the DTI in July 2001, set out a wide range of proposals to modernise and strengthen the UK’s competition regime.  The Enterprise Bill, which was introduced on 26 March 2002, implements the Government’s reform programme.

In addition, the Government is taking action to promote competition in specific markets.  In October 2001, the Office of Fair Trading (OFT) launched three studies into competition in the markets for information technology (IT) goods and services, pharmacies and extended warranties for electrical goods.  The Government has also taken forward the recommendations of the Cruickshank report into banking services (March 2000) and the Competition Commission’s report into small business banking (March 2002).

Internal links

• Pre Budget Reports
• Budgets

External links

• DTI Consumer and Competition Policy Directorate
• Office of Fair Trading

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Enterprise and Productivity index