Energy suppliers threatened with disconnection ban
MPs on the influential Trade and Industry Select Committee have warned gas and electricity suppliers that they would recommend a ban on disconnections – if customer support was not improved.
Committee chairman Martin O’Neill challenged the industry to improve debt prevention programmes and to protect vulnerable consumers.
He added that the industry should improve internal procedures on billing and customer switching to reduce errors.
In a report out today, the MPs conclude: “Unless industry demonstrates a serious commitment to and success in addressing these problems, we would recommend the Government to legislate to ban disconnections of domestic fuel supply.”
Energywatch welcomed the report by calling for a root and branch reform of the disconnection process.
It highlighted the case of pensioners George and Gertrude Bates who were found dead in October 2003, 11 weeks after their gas supply had been disconnected by British Gas.
Chief executive Allan Asher, said: “The tragedy of the Bates, the elderly, frail couple who were disconnected in 2003, illustrated the urgent need for companies to tighten up every element of the disconnection process. Companies are now on final warning to sort the mess out. That means no more disconnections of vulnerable people and no more disconnections in error. “
But, the Energy Retail Association said no vulnerable customer had been cut off this year due to a new safeguarding programme.
Chief executive Duncan Sedgwick said the report related to the situation seven months ago: “Energy suppliers were developing new policies on disconnection before the inquiry began and throughout the winter a new safety net procedure has been used successfully by suppliers and, as a result, no vulnerable person has been disconnected.”
Mr Sedgwick added: “Our procedures strike a balance between those who need help to pay their bills and those who try to avoid paying for their gas and electric.”
He said the safety net procedures enabled them to identify those in fuel poverty or elderly people in need of help. Those customers would not be cut off but would be referred to debt advice, charities and Government services.
And he said that suppliers must retain the right to cut off customers, adding: “It is not fair that the majority of customers should foot the bill of those who use gas and electricity without paying for it.”
Georgia Klein, senior policy officer at the National Consumer Council said the industry needed to provide better solutions for people already in debt and on low incomes.
She said that a quarter of people using pre-payment meters disconnect themselves from supply, saying that “better provision of payment methods, such as payment to suppliers direct from people’s benefits and cheaper pricing structures” were needed.
