Ofgem must set 'ambitious vision' for vulnerable energy customers, says Citizens Advice

By agency reporter
May 18, 2019

Citizens Advice is calling on Ofgem to use its forthcoming vulnerability strategy to set out how it will better support vulnerable energy customers who fall behind on their bills.

The call comes in a new report from the charity detailing the experiences of people in vulnerable circumstances – for example a disability or long-term health condition – who have been behind on their energy bills for over a month.

In 2018 Citizens Advice helped 43,232 people with energy debt problems through its local network. This was a 12 per cent increase compared with 2017. Nearly half (48 per cent) of these people had long-term health conditions or disabilities.

Since 2014, it has been more common for people to seek help from Citizens Advice about problems with essential bills, such as energy or council tax, than consumer credit.

The report revealed a number of common problems experienced by people in vulnerable circumstances once they get behind on their bills:

  • Energy suppliers’ approach to debt collection is often seen as aggressive and can make people’s problems worse
  • Vulnerable customers are unlikely to engage with support unless it is clearly framed as a way out of their problems

People in vulnerable circumstances face specific barriers to engaging with their supplier. For example, Liz, who has a nine-year-old son with autism, received a gas bill that was much larger than expected. She thinks her son may have turned the immersion heating on. Her supplier was understanding when she called them, but then she received strongly worded letters that didn’t acknowledge the phone call. This left Liz feeling anxious and unsure where she stood.

Citizens Advice is calling on the regulator to use its vulnerability strategy to make a number of reforms including:

  • Set clear targets for the sector’s performance on debt, for example to cut the number of people in arrears without arrangements to repay, or for the average level of debt repayments to decrease
  • Make it a licence requirement that suppliers follow principles designed to assess a consumer’s ability-to-pay when setting debt repayment levels
  • Compel suppliers to trial different approaches to communications with customers about debt, if suppliers fail to do so voluntarily
  • Work with DWP to review guidance for Fuel Direct - the system via which payments are deducted from benefits to pay arrears.

Gillian Guy, Chief Executive of Citizens Advice, said: “The regulator needs to set an ambitious vision for how suppliers should support and protect vulnerable people who fall behind on their bills.

“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.”

* Read the report here

* Citizens Advice https://www.citizensadvice.org.uk/

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