A MONOPOLIES and Mergers inquiry into the National Grid's pricing controls in Britain came a step closer after the industry regulator announced plans to cut domestic bills by an average of £4 to £5 a year.

Prof Stephen Littlechild, in his fourth consultation paper reviewing transmission price control, said those savings could be made from next April for consumers whose bills averaged £300 annually.

The proposals drew immediate criticism from the National Grid, the privatised company that owns the electricity network in England and Wales. Chief executive, Mr David Jones, said the regulator's plans were "ill-founded".