Citizens Advice: energy regulator must do more to help vulnerable customers
The charity has issued the call following a 12% rise in the number of people who required its help to resolve energy debt problems in 2018. 43,232 people required Citizens Advice’s help in this area in 2018 – close to half of these had long-term health conditions or disabilities.
Since 2014, Citizens Advice noted that it has become more common for people to seek help from Citizens Advice about problems with so-called essential bills, such as energy or council tax, than credit cards.
The charity has produced a report which details the experiences of people in vulnerable circumstances who have fallen behind on their energy bills. For example, those with a disability or long-term health condition. It found that the approach to debt collection taken by energy suppliers is often seen as aggressive.
In addition, vulnerable customers faced barriers to engaging with their supplier.
Gillian Guy, chief executive of Citizens Advice, commented: “Both Ofgem and suppliers need to take action and help people get over the barriers that stop them from seeking help and getting the right advice and support.
“The package of support that’s on offer needs to be sensitive. Aggressive collection practices and demands for unaffordable payments only serve to make people’s lives more difficult.”
Time for change
Citizens Advice is calling on the regulator to introduce the following reforms:
- Set clear targets for the sector’s performance on debt. For example, cutting the number of people in arrears without arrangements to repay
- Make it a requirement for suppliers to follow principles designed to assess a consumer’s ability to pay when setting debt repayment levels
- Compel suppliers to trial different communication approaches with their customers
- Work with the Department for Work and Pensions to review guidance for Fuel Direct – the system via which payments are deducted from benefits to pay arrears
The report published by Citizens Advice has been welcomed by Peter Earl, head of energy at comparethemarket – the comparison site.
He commented: “Protecting vulnerable customers should be a priority for the energy industry. Recent steps taken by the regulator – which were meant to protect all customers, including the vulnerable – have not had the desired effect.
“The energy price cap was meant to limit the impact of often unfair and excessive price rises, but instead customers on a standard variable tariff have been forced to fork out an additional £117 a year on average.”
Comparethemarket’s own research has shown that one in eight (12%) of over-65s are concerned they won’t be able to afford an increase in their bills.
“This demographic is one of the least likely to engage with and switch their energy provider. We urge the regulator to give more support to those who need it most,” Earl added.