Energy company direct debit responsibility
Discussion
So today my retired father got anenergy monitor of eBay and asked if I would set it up! When I got there I asked for a current bill to get his tarif info, he told me he doesn't get bills, just pays £57 a month DD and that covers it! I checked his email and going back 6 months found nothing. I managed to find enough info to create an online account , then managed eventually to get to the bills ( you have to turn off the pop up blocker in chrome) . As I suspected the £57 doesn't anything like cover the cost of their energy and they are over £1k in debit. Now this has been going on since Feb 2015 , my dad assures me that the company told him he was in an all inclusive deal! As it happens this company does actually have such a thing on their website! I called up the company and they basically said they will just have to up the direct debit to clear the bill ! Now this account has been renewed twice over the phone , and at no stage have the energy company made any attempt to change the DD or contact my father about the underpayment ! Now I accept that most of the blame is with my dad not bothering to do his due diligence, but according to ofcom an energy provider has a responsibility to make sure the DD is online with usage and they have 15 months to deal with it! They have a fairly high electric usage charge that I think is down to leaving the underfloor heating on in the conservatory and if they had got the bills or a request for a DD increase would have modified their behaviour. I have raised a complaint with the energy company and they said we would hear back in 8 weeks of less! The energy ombudsman said we have a valid complaint but have to give energy company chance to resolve it. What I'm asking is what you expect the energy company to do to resolve it? I don't expect they will right off the outstanding balance, but so far they have kindly offered to up the DD to £400 to clear the balance, would you just suck it up and pay them or expect them to put their hand in their pocket toward the total? Cheers
OP, never forget that by putting a DD in place a third party is authorised to take payments automatically from your bank account.
http://www.financial-ombudsman.org.uk/publications...
A DD mandate is seldom, if ever, for a fixed amount. The holder can change it at will as long the acccount holder receives prior notification.
Two points to consider.
1. Can your father service a DD for £400 per month? If this will be a problem for him, don't trust the energy company.*
2. It may have 'offered' to do this but it's not what most people think it is (i.e. an offer has to be accepted to be binding)
All it has to do is send the required notification under the DD scheme, crack on anyway and argue afterwrds.
Indeed, if 2 applies (notification given) and the money has been taken, getting it back will be a devil of a job: indeed it may prove nigh on impossible.
Your bank may well refuse to help unless the payment has ben wrongly taken (i.e. there has been a breach of the scheme rules)**
* Especially if it's one of the 'big six'. Their customer satisfaction ratings make depressing reading.
ALL of them are in the lower half and one props up the foot of the 'league table' (and has done for years).
http://switch.which.co.uk/energy-suppliers/energy-companies-rated.html
** In a previous life I was the DD scheme administrator for a company which was a mandate holder (i.e. the recipient of payments).
At any other time they expect me to do it for them and give them the figure.*** At least they give me options: by post/phone/online.
It amazes me how few people bother to check their energy usage as they go. Everyone has a meter and it not rocket science to check prices.
Increases are not suddenly sprung on people. Notification letters are sent out. It doesn't require a Maths A level to do the necessary calculations.
It's up the individual how often they do it. Even a ball park figure is better than nothing. That way you don't get any unpleasant surprises.
*** Btw, if you're not on a fixed tariff deal the trick is to adjust the readings to give yourself some protection from the swingeing price increases that seem to occur with increasing frequency.
http://www.financial-ombudsman.org.uk/publications...
A DD mandate is seldom, if ever, for a fixed amount. The holder can change it at will as long the acccount holder receives prior notification.
Two points to consider.
1. Can your father service a DD for £400 per month? If this will be a problem for him, don't trust the energy company.*
2. It may have 'offered' to do this but it's not what most people think it is (i.e. an offer has to be accepted to be binding)
All it has to do is send the required notification under the DD scheme, crack on anyway and argue afterwrds.
Indeed, if 2 applies (notification given) and the money has been taken, getting it back will be a devil of a job: indeed it may prove nigh on impossible.
Your bank may well refuse to help unless the payment has ben wrongly taken (i.e. there has been a breach of the scheme rules)**
* Especially if it's one of the 'big six'. Their customer satisfaction ratings make depressing reading.
ALL of them are in the lower half and one props up the foot of the 'league table' (and has done for years).
http://switch.which.co.uk/energy-suppliers/energy-companies-rated.html
** In a previous life I was the DD scheme administrator for a company which was a mandate holder (i.e. the recipient of payments).
Thermobaric said:
How on Earth did the energy company let this happen. Don't they send people to read the meters every 3 months or so?
Readers are an expensive overhead. Energy suppliers are only required by law to read meters once every two years. My supplier does it once a year.At any other time they expect me to do it for them and give them the figure.*** At least they give me options: by post/phone/online.
It amazes me how few people bother to check their energy usage as they go. Everyone has a meter and it not rocket science to check prices.
Increases are not suddenly sprung on people. Notification letters are sent out. It doesn't require a Maths A level to do the necessary calculations.
It's up the individual how often they do it. Even a ball park figure is better than nothing. That way you don't get any unpleasant surprises.
*** Btw, if you're not on a fixed tariff deal the trick is to adjust the readings to give yourself some protection from the swingeing price increases that seem to occur with increasing frequency.
Oh they read the meters just fine, they where read 2 times a year by a meter reader and once every 3 months by my dad! They literally just let the bill build up and up without doing anything, 27 months and counting! It's obviously an admin cock up , but my dad honesty (naive if you ask me) thought his £57 was covering it ! Some months they had £140 just on electric ! As I said if they had pointed this out they would have modified their usage ! Bit like someone saying give us £100 a month and we will cover all your petrol , then saying after 3 years , oh yeah you owe me £1000 as your car was only doing 25mpg ! Yeah I know because I booted everywhere because I thought it was covered
Drumroll said:
I am amazed it has got to that much without them chasing it. I am frequently arguing with suppliers that they don't need to up my DD by £10 plus a month because in a high usage month I have gone into dept to less than £10
This^.Ours are constantly upping it at the end of the winter saying our DD won't cover it anymore and my missus has to phone them and point out that our usage will be dropping significantly due to, you know, summer coming!
Green Star were the cheapest a couple of years ago. They topped the MSE Energy Club charts for a while, and then got swamped with new customers. So many that they couldn't cope with all the transfers, support calls, emails etc. and their ratings plummeted accordingly. I tried to join them at that time, but after months they hadn't even processed my transfer so I cancelled the transfer request (eventually, what a fight!) and went elsewhere.
I'm not surprised that they hadn't spotted this sooner. I got the impression from my dealings with them that they don't really have any systems, just a bunch of spreadsheets or something similar.
I'm not surprised that they hadn't spotted this sooner. I got the impression from my dealings with them that they don't really have any systems, just a bunch of spreadsheets or something similar.
You may, repeat may, be able to get out of paying anything over 1 year old
The key is not being notified and it sounds like your father hits that target dead centre.
One of the big suppliers had a huge computer-system-change inspired billing foulup a few years ago and my partner was able to mitigate the pain by taking advantage of the back billing limit,
regards,
Jet
The key is not being notified and it sounds like your father hits that target dead centre.
One of the big suppliers had a huge computer-system-change inspired billing foulup a few years ago and my partner was able to mitigate the pain by taking advantage of the back billing limit,
regards,
Jet
Thermobaric said:
How on Earth did the energy company let this happen. Don't they send people to read the meters every 3 months or so?
Mine don't. They send me an estimated bill in advance for the next year, usually grossly over-estimated (last year it was 400% higher than I actually used), then I have to read my meter and send them the reading for them to adjust the direct debit.I bought a house November 2016.......continued with the previous owners provider.........
the bills seemed high to me so I queried it - they said it's correct.
I am very busy, took me over a year to check really..........as my Gas was off for 3 months (doing the place up) it occurred I shouldn't have been paying the 160 a month in that period.
Submitted meter readings online, they rejected them as inaccurate and too low.
Called up, told them they were accurate they said submit again - at this point the system wouldn't even accept the readings as too low..........
I took photos of the meters, emailed them in..........
upshot - they owe me 1400 quid (which they paid in 3 days) and my bill is now 55 a month roughly.
It's my fault for not trying harder and letting it drift - but Utility Warehouse are recommended by me as a result of how they handled it.
the bills seemed high to me so I queried it - they said it's correct.
I am very busy, took me over a year to check really..........as my Gas was off for 3 months (doing the place up) it occurred I shouldn't have been paying the 160 a month in that period.
Submitted meter readings online, they rejected them as inaccurate and too low.
Called up, told them they were accurate they said submit again - at this point the system wouldn't even accept the readings as too low..........
I took photos of the meters, emailed them in..........
upshot - they owe me 1400 quid (which they paid in 3 days) and my bill is now 55 a month roughly.
It's my fault for not trying harder and letting it drift - but Utility Warehouse are recommended by me as a result of how they handled it.
They are calming that he was billed correctly, and the bill where available on their website. This is true (if you understand PC and can spot the browser is blocking attachments by default for this web site) but its not the same as being emailed or posted. The meter reading where bang on. The slip up has been not changing the direct debit or infact doing anything at all other than collect the monthly DD of £57 for 27 months and counting. I will look at the back billing charter, its a bit of a weird one as it doesn't quite fit into back billing.
I suspect Green Star have a IT system that has a few bugs and couldn't cope. When I called them up the first thing i asked was "is their anything unusual about my account or payment set up" and the lady said "no, all look fine" i had to point out the fact the account was in £1043 of arrears and the £57 DD was on average less than 50% of what was billed. She then put me on hold for ten minutes while she looked into and got a line supervisor to check it,
Hopeless
Thanks for the replys
I suspect Green Star have a IT system that has a few bugs and couldn't cope. When I called them up the first thing i asked was "is their anything unusual about my account or payment set up" and the lady said "no, all look fine" i had to point out the fact the account was in £1043 of arrears and the £57 DD was on average less than 50% of what was billed. She then put me on hold for ten minutes while she looked into and got a line supervisor to check it,
Hopeless
Thanks for the replys
Found this in the Back billing Charter :
Failed to reassess a payment arrangement (e.g. Direct Debit) within 15 months, or failed to reassess based on a reasonable estimate.
Think this covers it, even their initial assessment of projected use stated an expected bill of £1289 so why they picked £57 i dont know. My guess is set the DD extremely low for a good headline figure when doing the Telesales bit , get the sale then ramp up the DD after they hook you in, (the simply forgot this bit)
Failed to reassess a payment arrangement (e.g. Direct Debit) within 15 months, or failed to reassess based on a reasonable estimate.
Think this covers it, even their initial assessment of projected use stated an expected bill of £1289 so why they picked £57 i dont know. My guess is set the DD extremely low for a good headline figure when doing the Telesales bit , get the sale then ramp up the DD after they hook you in, (the simply forgot this bit)
How long has the complaint been running now and how was it last left with the energy company?
The best strategy for now is to try and let the complaint tick on until the 8 weeks then declare a deadlock and refer it to the ombudsman who will review and settle the case for you.
Energy co's get a penalty for complaints hitting the ombudsman so they have an incentive to resolve before that.
I would be pressing them for why they didn't at least do a DD reassessment every six months which is industry best practice and stick to complaining about that and use your point about back billing charter on the DD assessment to get that lopped off.
Worst case, explain that although you accept the consumption is valid, you can't randomly start paying £400 a month.
Suggest to them if you have to pay they put your father on a payment plan for the amount separate to the DD and that it is setup over 24 months.
Having such a payment plan will not stop you from changing supplier (guessing after this you may want to) as you are paying to clear the balance and are not in arrears/default, they just allowed you to rack up a debit.
They cannot change your direct debit without notifying you in writing in advance in the energy regulations so if something random like a £400 DD vanishes out of the bank, get your father to the bank and invoke the DD guarantee (but I doubt this will be required).
At least when it was just the big six, consistent levels of incompetence could be expected but now there are 76 suppliers it's a right old mess...
Good luck with it
The best strategy for now is to try and let the complaint tick on until the 8 weeks then declare a deadlock and refer it to the ombudsman who will review and settle the case for you.
Energy co's get a penalty for complaints hitting the ombudsman so they have an incentive to resolve before that.
I would be pressing them for why they didn't at least do a DD reassessment every six months which is industry best practice and stick to complaining about that and use your point about back billing charter on the DD assessment to get that lopped off.
Worst case, explain that although you accept the consumption is valid, you can't randomly start paying £400 a month.
Suggest to them if you have to pay they put your father on a payment plan for the amount separate to the DD and that it is setup over 24 months.
Having such a payment plan will not stop you from changing supplier (guessing after this you may want to) as you are paying to clear the balance and are not in arrears/default, they just allowed you to rack up a debit.
They cannot change your direct debit without notifying you in writing in advance in the energy regulations so if something random like a £400 DD vanishes out of the bank, get your father to the bank and invoke the DD guarantee (but I doubt this will be required).
At least when it was just the big six, consistent levels of incompetence could be expected but now there are 76 suppliers it's a right old mess...
Good luck with it
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