DEREK THOMAS MP CALLS FOR URGENT ACTION ON ENERGY BILLS

Hard-working families in St Ives have been overspending by £6.8 million over the past three years thanks to broken energy market

New figures out today, calculated by leading independent energy supplier First Utility[1], show that thousands of people in St Ives have overpaid for energy to the tune of £721, as a result of being on a Big Six ‘Standard Variable Tariff’ for the last three years.

This is despite Government rules, introduced in 2012, which forced the Big Six to tell their customers if cheaper deals exist – a requirement some big suppliers have deliberately circumvented.[2]

UK-wide more than £7 billion has been overspent by hard-working families who are stuck on the most expensive tariff with one of the Big Six, often for years or even decades.

The figures are released as Parliament prepares to debate a motion on Thursday that states “this House deplores the big six energy firms’ treatment of out-of-contract energy customers on default tariffs and believes immediate action is needed to protect those consumers.”

Derek Thomas MP said:It is outrageous that, more than 15 years later, the Big Six are still profiteering from the customers they inherited from privatisation – many of them old, vulnerable or working families who are cash-strapped but time poor, trapped on the worst possible deals as a result. The Government should consider legislating to force the Big Six to automatically switch their most loyal customers to their cheapest possible deals. The Big Six have been over-charging their loyal customers for far too long.”

Ed Kamm, UK MD, First Utility said: The Big Six have been exploiting customers’ loyalty for too long and it has to end. The brutal truth, hidden away in the Competition and Markets Authority report, proves that the Big Six have been relying on their SVT customers for years to bolster their profits. We have to see real change in 2017, with the onus on helping those who have been kept on bad deals for years and years.”

 Looking at today’s figures, Derek Thomas also expressed particular concern that the Big Six energy companies were profiteering from the loyal customers they had inherited from privatisation[3].

The figures obtained by First Utility suggest that 85% of UK households are supplied by one of the Big Six, of those, 70% are on their supplier’s most expensive tariff, and that 55% have been on it for more than three years.

 

[1] First Utility is the UK’s largest independent energy supplier, with close to 1 million customers. It is based in Warwickshire, employ 1,500 people and is proud to be an accredited Living Wage employer. The company donates 1% of its profits to the First Utility Foundation, which supports vulnerable families across the UK. And, since its launch in 2008, it has saved customers a collective £500m through offering transparent, fair and lower energy tariffs.
[2] Rules were brought in in 2012 to ensure the Big Six told customers on expensive deals if cheaper deals exist when they get their bill. Evidence suggests many of the Big Six have circumvented this process, for example billing only a few times a year (so the customer receives the alert infrequently) or deliberately signing “exclusive” deals for new customers which they don’t need to tell their own customers about, and are therefore excluded from the Cheapest Tariff Alert requirement, see details in the Sun, 15 August 2016, Link

 

[3] The Competition and Markets Authority (CMA) found more than two in five (44%) consumers had never switched supplier, Link