Energy and Climate Change Secretary, Amber Rudd, yesterday announced plans to work with both Citizens Advice and Ofgem to address the issue of poor customer service in the energy sector.
Extending Powers of the Ombudsman
The move comes after various bodies, including the Competition and Markets Authority reported on the high volume of complaints being received by energy companies throughout the UK. Energy suppliers have been chastised for, among other things, failing to repay overestimated bills on time, leaving customers languishing with little choice but to wait and register complaints.
The companies were further chastised for their poor efforts in actually responding to the complaints they did receive.
The Energy Ombudsman service currently has the power to investigate and attempt to resolve complaints made in the energy sector but only on a case by case, individual basis. Amber Rudd now intends to extend the authority of the Ombudsman so that the industry-wide problems that are coming to the fore can truly be resolved.
“Proud Green Conservative”
Rudd, who yesterday announced on Twitter that she is a “proud green Conservative” said: “As a One Nation Government on the side of consumers, we are determined to keep bills down and I am clear that hardworking families and businesses should not have to tolerate poor service from energy companies.”
Speaking more directly about her plans for the Ombudsman, she added: “We want to see the Ombudsman’s role going beyond simply resolving individual complaints so that it has real teeth and can work with Ofgem to address industry-wide problems that are making life miserable for consumers, as well as deal with repeated failings of poorly-performing firms. Where companies have developed a pattern of bad behaviour, they will have no hiding place.
“Bill payers are at the heart of everything we do” she added emphatically, “and they must receive better treatment and get fairer deals alongside greater energy security.”
Rudd’s statements have been welcomed by the Lewis Shand Smith, the chief Ombudsman, who gave her his full support, saying that “as the Energy Ombudsman… we have the experience and the capabilities to make this work for consumers and energy suppliers alike.”
50,000 Complaints a Year
The Energy Ombudsman deals with more than 50,000 complaints every year, and that number has been growing at an alarming rate. In fact in the first six months of this year, 35,309 complaints were received – more than double the amount received over the same period last year.
The joining together of the Energy and Climate Change Secretary, Ofgem, Citizens Advice and the Energy Ombudsman should amount to a powerful force in the effort to improve competitiveness and transparency in the Energy sector – something that has been being called for for a long time now.
We have seen the customer base for smaller, competitor suppliers growing steadily as more and more people are starting to move away from the much criticised Big Six (Npower, British Gas, Scottish Power, SSE, EDF Energy and E.On). However, a recent report from the CMA showed that it was actually these smaller suppliers who were receiving the largest number of complaints, on the whole.
These changes look to make a marked difference to the energy sector as a whole. Ofgem’s Chief Executive, Dermot Nolan, has said: “we welcome the Secretary of State’s support for the Energy Ombudsman and their role in identifying systemic customer service and complaint issues the industry.”
