Ofgem ignored 140,000 debt complaints before British Gas scandal

Original article republished from open Democracy under Creative Commons Attribution-NonCommercial 4.0 International licence.

Image of banknotes and prepayment meter key
More than 30,000 complaints were about the disconnection and forced installation of prepayment meters. Image of banknotes and a prepayment meter key

Exclusive: Energy regulator forced into action this week did nothing about mountain of complaints last year

Adam Bychawski

3 February 2023, 1.53pm

Energy companies received more than 140,000 complaints about their treatment of customers in debt last year alone, openDemocracy can reveal.

They included 33,000 complaints about the fitting or disconnecting of pre-payment meters.

Yet the energy regulator Ofgem was only forced into action this week when an undercover Times investigation found British Gas had sent bailiffs to break into vulnerable people’s homes and fit the meters by force. It has now asked energy companies to pause the practice.

The data, obtained by openDemocracy through a Freedom of Information request, has revealed for the first time the scale of alleged mistreatment of vulnerable customers since the energy price cap was first hiked in April.

“Ofgem has known about this crisis for years, and so have the companies themselves. Suppliers are not being honest when they act like they’ve just discovered it and they’re shocked, like the CEO of Centrica did yesterday,” Ruth London, co-founder of the Fuel Poverty Action campaign group, told openDemocracy.

Energy companies are required to report the number of complaints they receive from customers every month to Ofgem. Between January and October last year, they received 146,046 complaints related to disconnection and debt issues – though Ofgem has refused to tell us which suppliers received the most.

The category includes complaints from customers about their energy supply being disconnected or having a prepayment meter installed forcibly without a warrant or despite them being vulnerable.

Other examples of complaints include customers being disconnected by error or without due process and being put on debt repayment plans that are unsuitable or unaffordable.

The true number of people being ill-treated is likely to be much higher. Ofgem revealed yesterday that customers were being left on hold for hours by energy companies, leading to more than half hanging up before they could report an issue.

Ofgem said revealing how many complaints different companies had received would breach Section 105 of the 2000 Utilities Act, which states that the public disclosure of information companies supply to the regulator is prohibited in order to protect national security. The law has previously been criticised for preventing whistleblowers from raising issues about the energy sector that are in the public interest.

The regulator said yesterday that it was “unacceptable” to forcibly install prepayment meters before all other options had been exhausted, and has launched an urgent investigation into British Gas

But charities have criticised the regulator for ignoring calls to end the practice for months.

“Lives have been and are being lost because of their silence and refusal to act on the truth they have long known,” said London.

Clare Moriarty, the chief executive of Citizens Advice, said it “should not have taken this long” for Ofgem to act. 

The charity said it saw more people unable to afford to top up their pre-payment metre last year than for the entirety of the previous decade combined.

The Times reported this week that British Gas customers who had prepayment meters forcibly installed included a woman in her 50s who the company’s bailiffs were told had severe mental health problems and a mother whose “daughter is disabled and has a hoist and electric wheelchair”.

The paper’s undercover investigation also alleged that the Arvato Financial Solutions employees were incentivised with bonuses to fit prepayment meters. The boss of British Gas owner Centrica apologised and said he was “disappointed, livid and gutted” on Thursday.

Last year, a non-executive director at the regulator resigned saying Ofgem had “not struck the right balance between the interests of consumers and interests of suppliers”.

Peter Smith, policy director at the charity National Energy Action, said: “The recent announcement by major suppliers that they would temporarily pause forced installations of pre-payment meters is welcome, but this was prompted by public shaming of suppliers and there is still no market-wide ban.

“We also desperately need a coherent plan to help millions of people already trapped on prepayment meters. This means rewiring the energy market to provide more affordable tariffs and finding new ways to address the underlying debt issues which are rife due to soaring energy costs.”

Richard Lane, Director of External Affairs at StepChange Debt Charity, said: “We welcome Ofgem’s move to suspend the forced installation of prepayment meters (PPMs), but it’s clear that thousands of households have been struggling with energy bills for some time now, which is evident in our own client data.

“For the people that have already been moved onto PPMs, there must be better protection to prevent self-disconnection and extreme energy rationing.”

Original article republished from open Democracy under Creative Commons Attribution-NonCommercial 4.0 International licence.

Continue ReadingOfgem ignored 140,000 debt complaints before British Gas scandal

British Gas halts use of warrants to force people on to prepayment meters

https://www.theguardian.com/business/2023/feb/01/british-gas-halts-use-of-warrants-to-force-people-on-to-prepayment-meters-allegations-vulnerable-customers-break-in

Image of banknotes and prepayment meter key
Banknotes and a prepayment meter key

Move follows allegations that third-party agents ignored vulnerabilities of customers and broke in to install equipment

British Gas has suspended the use of court warrants to force the installation of prepayment meters after evidence that agents working on its behalf ignored customers’ vulnerabilities.

MPs and consumer groups had raised concerns that elderly and disabled people were being forced on to prepayment meters and then routinely cut off from heat and power as they could not afford to top up.

Wednesday’s decision came after an investigation by the Times alleged that Arvato Financial Solutions, a company used by British Gas to pursue debts, had broken into homes to fit meters when there were signs that young children and people with disabilities lived in the property. AFS employees are incentivised with bonuses to fit prepayment meters.

https://www.theguardian.com/business/2023/feb/01/british-gas-halts-use-of-warrants-to-force-people-on-to-prepayment-meters-allegations-vulnerable-customers-break-in

Ofgem statement on British Gas prepayment meter installations

“These are extremely serious allegations from The Times. We are launching an urgent investigation into British Gas and we won’t hesitate to take firm enforcement action.

“It is unacceptable for any supplier to impose forced installations on vulnerable customers struggling to pay their bills before all other options have been exhausted and without carrying out thorough checks to ensure it is safe and practicable to do so.

“We have launched a major market-wide review investigating the rapid growth in prepayment meter installations and potential breaches of licences driving it.

“We are clear that suppliers must work hard to look after their customers at this time, especially those who are vulnerable. The energy crisis is no excuse for unacceptable behaviour towards any customer, particularly those in vulnerable circumstances.”

Continue ReadingBritish Gas halts use of warrants to force people on to prepayment meters

Nearly 20% of Brits already living in poverty before cost-of-living crisis, report finds

https://morningstaronline.co.uk/article/b/nearly-20-of-brits-already-living-in-poverty-before-cost-of-living-crisis

Image of banknotes and prepayment meter key

MILLIONS of people in Britain, including 3.9 million children and 1.7m pensioners, were in living in poverty even before the cost-of-living crisis hit, damning figures revealed today.

Around 20 per cent of the population, equating to 13.4m people, were living in poverty in 2020/21, the Joseph Rowntree Foundation’s annual poverty report found.

The report warned that there are elements in the benefits system that increase poverty, including the two-child limit, five-week wait for universal credit payments and unaffordable debt deductions.

About 7.2m people are skipping meals, showers and heating, it found.

https://morningstaronline.co.uk/article/b/nearly-20-of-brits-already-living-in-poverty-before-cost-of-living-crisis

Continue ReadingNearly 20% of Brits already living in poverty before cost-of-living crisis, report finds

Energy firms face Ofgem investigation over number of households forced onto pre-payment meters

https://morningstaronline.co.uk/article/b/energy-firms-face-ofgem-investigation-forced-prepayment-metres

Image of cash and pre-payment meter key
Image of cash and pre-payment meter key

ENERGY firms face an Ofgem investigation over a “concerning” rise in the number of struggling households being forced onto prepayment meters.

The regulator said yesterday that it would also consider taking legal action if firms are found not to have taken due care when moving customers onto the more costly meters.

Customers who fail to keep the devices topped up with money have their electricity and gas cut off.

In recent months, hundreds of thousands of households have been switched onto prepayment metres, often unwillingly, after falling behind on their bills.

https://morningstaronline.co.uk/article/b/energy-firms-face-ofgem-investigation-forced-prepayment-metres

Continue ReadingEnergy firms face Ofgem investigation over number of households forced onto pre-payment meters

Anti-poverty campaigners call on government to ban forced prepayment meter instillations

https://www.morningstaronline.co.uk/article/b/anti-poverty-campaigners-call-on-government-to-ban-forced-prepayment-meter-instillations

Image of cash and pre-payment meter key
Image of cash and pre-payment meter key

FUEL poverty campaigners staged “warm up” demonstrations across Britain at the weekend, calling on the government to ban the forced instillation of prepayment meters.

The government has come under increasing pressure to outlaw the imposition of these meters since an investigation by the i newspaper revealed that energy companies have secured half a million court warrants to enter people’s homes and install them since July 2021.

Citizens Advice also reported that 3.2 million people were disconnected in 2022 over their inability to top up the meters, more than in the previous 10 years combined.

Business Secretary Grant Shapps promised today to “name and shame” energy suppliers that force such meters on their customers, revealing that he has written to companies to demand that they voluntarily end the practice.

https://www.morningstaronline.co.uk/article/b/anti-poverty-campaigners-call-on-government-to-ban-forced-prepayment-meter-instillations

Continue ReadingAnti-poverty campaigners call on government to ban forced prepayment meter instillations