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British Gas Business to pay £9.5m for customer service failings

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Written by: Paloma Kubiak
24/01/2017
The business arm of British Gas is to pay £9.5m in redress over billing issues and complaints handling following its bungled IT system upgrade in 2014.

In March 2014, British Gas Business implemented a new IT billing system which led to tens of thousands of business customers receiving late and inaccurate bills. More than 6,000 new customers also experienced delays registering with the supplier.

As a result, the number of complaints soared and the supplier wasn’t able to handle them properly or on time.

British Gas Business, which supplies around 400,000 customers, voluntarily approached the energy regulator to report the problems in December 2014 and Ofgem launched an investigation in October 2015.

Ofgem found that British Gas Business had failed to treat business customers fairly and that it didn’t do enough to protect affected customers from issues that arose from the new IT billing system.

However, Ofgem noted that British Gas Business did compensate some affected customers and acted to reduce the level of delayed bills. It also allowed some customers who were in debt to switch, only if the debt was related to its failure to produce a bill.

Since then, the supplier has hired additional agents to help handle the increased call volumes and to reduce the backlog of complaints and Ofgem said it has also “significantly improved its performance on billing and customer registrations”.

British Gas Business has agreed to pay £9.5m in redress, including direct payments to affected business customers and it has also made payments to the charity, Money Advice Trust.

‘British Gas Business didn’t act quickly enough’

Ofgem’s chief executive, Dermot Nolan, said: “British Gas Business has done the right thing by coming forward to Ofgem to report problems with its new IT billing system, and has since worked hard to improve its customer service. However, British Gas Business’ implementation did go wrong and it didn’t act quickly enough to put things right.

“Many existing businesses customers were left without accurate bills, causing significant concern. New customers were delayed from switching to the supplier, potentially costing them money by leaving them on a more expensive deal with another supplier. The £9.5m payment sends a strong reminder to all energy companies that they must treat consumers fairly at all times, including while new systems are put in place.”

‘I’d like to apologise for any inconvenience caused’

Gab Barbaro, managing director of British Gas Business, said: “We invested in a new billing system so we could improve the service we provide to our business customers. At the time, this was a major undertaking – merging nearly 100 different systems into one. It didn’t go as smoothly as we would have liked so we reported this to Ofgem as a priority.

“We’ve worked hard to put this right since and Ofgem has acknowledged this today. We’ve restored a very good quality of customer service, and more and more of our customers are going online to use the new billing system. I’d like to apologise to our business customers for any inconvenience caused when we were implementing the system.”

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