However, as the final report of the Commission for Customers in Vulnerable Circumstances has found, action is required to ensure that suppliers act on these good intentions.
At National Debtline and Business Debtline – the free advice services run by the Money Advice Trust – we are hearing from more and more people struggling with smaller, trickier debts, often for essential household costs such as energy. Energy arrears, along with water, council tax and rent, now make up a significant part of the UK’s household debt landscape.
As our advisers see first-hand every day, these problems with energy debts are often interlinked with mental health problems, serious illness or addiction. Given the essential nature of energy, suppliers have a clear responsibility to do more to help these customers.
This is why I was pleased to be invited to serve as a member of the recent Commission for Customers in Vulnerable Circumstances, set up by Energy UK. Along with my fellow commissioners, I have spent the past year taking evidence on current practice and where suppliers need to do more.
First, the industry needs to address inadequate and inconsistent practice on vulnerability – and in particular, improve identification and access to support for customers. In our evidence gathering we heard many examples of good practice – highlighting the positive impact suppliers can make. However, this support is inconsistent, both across the industry and sometimes within the same supplier.
There needs to be a particular effort to improve identification of customers in vulnerable circumstances, reduce barriers that prevent customers disclosing information about their needs, and putting in place the right training, systems and processes to support these aims.
At the Money Advice Trust, we have recently developed a new energy training course to give frontline staff the skills and knowledge they need, which we hope will help suppliers as they grapple with this key aspect of the vulnerability challenge.
Second, there is undoubtedly more that suppliers can do on affordability and income maximisation. We all know that for many people, meeting basic household costs is a struggle – and most of the factors at play here are outside of suppliers’ control. However, energy suppliers can still do more to help people in this situation.
The commission recommends that suppliers use court enforcement sensitively and appropriately – and in the case of vulnerable customers, avoid the use of bailiffs entirely.
We found there is also a need for energy suppliers to do more to help customers to maximise their income. While not seen as a traditional domain for suppliers, taking this approach – including through charity partnerships – can help many more customers to pay their bills on a sustainable basis.
Third, there is clearly a role for the third sector to play more broadly, and significant scope to improve partnerships in place across the industry. This includes signposting to debt or energy advice, and helping people access other support.
More broadly, this should be about drawing on expertise across sectors. At the Money Advice Trust we see that there are significant benefits to working in partnership with suppliers, and plenty more opportunities to develop this work in the future.
The commission’s report will feed in to Ofgem’s consultation on its new Consumer Vulnerability Strategy – and will hopefully be of immediate and direct use to suppliers looking to take action now to improve their practices. I am pleased that Energy UK will take forward our recommendations on a new Code of Conduct and a voluntary Vulnerability Charter.
This is just a starting point and there is a great deal of work to do. At the Money Advice Trust, we look forward to building on our existing work with the industry, and working with many more suppliers to help put these recommendations into practice.