Chief Minister Howard Quayle is setting up his own committee to review Manx Gas prices.

The announcement came shortly after Office of Fair Trading chairman Martyn Perkins told Tynwald that a full review of the regulatory agreement between the OFT and Manx Gas was due to get underway next year, as already scheduled.

Last month, following protests by customers, Manx Gas announced it was reviewing its standing charges.

It pledged to come back to Treasury and the OFT by the end of October.

Mr Quayle said: ’I am pleased that Manx Gas has set up a review of its prices, but I want to ensure that they receive an effective level of scrutiny.

’To that end, I will be setting up my own committee to review the current situation and develop conclusions on whether the current arrangement is working for the Isle of Man.’

He said the committee would be made up of Tynwald members.

’As a monopoly supplier, Manx Gas is in a privileged position,’ he added.

’In return for that privilege, they have a responsibility to ensure they are fair in the way they provide their service to the people of the Isle of Man.

’It is a finely balanced relationship, but at the moment my instinct is that the balance is falling in their favour.’

He noted the public had major concerns about energy prices, particularly gas.

Earlier, OFT chairman Martyn Perkins faced questions about the regulatory agreement between his office and Manx Gas.

The current agreement runs until the end of next year and Mr Perkins said a review of the arrangement would get underway in the first half of 2018.

Mr Perkins said the current agreement could be terminated earlier, if both sides agreed, or if Manx Gas defaulted on its terms.

The current deal limits profits by Manx Gas to 9.99 per cent, but there has been anger, in particular, at the application of standing charges, which some say has left them with large bills even when they have not used much gas.

Mr Perkins was pressed by Lawrie Hooper (LibVannin, Ramsey) on whether the OFT considered the method used for the ’regulatory adjustment’ under the current agreement - a rebate for customers - was fair. Manx Gas calculates any such rebate based on units used by the customer in the current year, saying it is the most practical option.

It is required to provide analysis of the payments of rebates on a quarterly basis.

’Provided Manx Gas agrees and abides by the terms of the agreement, it is considered fair,’ said Mr Perkins.

’Painful’ changes are needed to solve the problem of rising health costs, Chief Minister Howard Quayle has warned.

Mr Quayle gave a ’state of the nation’ address to Tynwald on Tuesday and admitted the rising costs were a concern.

The former health minister warned: ’Without immediate and radical action, costs will continue to increase.

’There are no magic bullets and any change will be painful, but it is necessary to ensure future economic sustainability for our vital public services.’

Just last week, Health Minister Kate Beecroft said big decisions needed to be made about what acute care services can be provided in the island, when she gave evidence to the Tynwald public accounts committee as part of a review of the Department of Health and Social Care’s £11.1 million budget overspend.

The DHSC has also raised the possibility of increasing prescription charges and slashing the number of people who are exempt from paying them.

It was not just in health where cost pressures were growing, Mr Quayle said.

’I have been adamant that we must reduce the cost of government,’ he continued. ’Key to this is working smarter and using technology to become more efficient.

’It is the responsibility of everyone in this honourable court to ensure the future sustainability of our public services.

’That is why we brought forward our plans to reduce the future liabilities for public sector pensions.’

He added younger people were becoming worse off than their parents.

’They cannot afford to own their own home. Many of them have seen their incomes reduce in real terms.’

As more people retired, pressure on the working population would increase, he said.

’I do not pretend to have the solution to this problem, but I highlight it today as it will need to be addressed sooner rather than later.’

Mr Quayle, who has been in office for just over a year, also used his speech to outline what he regarded as the achievements of his administration.

These included the restoration of free television licences for the over-75s, the launch of the SAVE programme to consult the public on reducing public expenditure and a budget ’aimed at working families, increasing child benefit and the personal income tax allowance’.

The government had got to grips with the Douglas promenade refurbishment proposals ’because we knew it had to be done’.

He said Tynwald had started last year with a ’shared belief that we could make things better’.

He added: ’I believe that same sense of purpose continues today. We can accomplish much more together than when we are divided.

’Our vision for the future will not happen on its own. It will take courageous, sometimes unpopular decisions.

’It will mean a conscious choice to support a future for the silent majority and not to pander to the interests of a vocal minority. Most of all, it will require action.’