Labour: More than 500,000 energy consumers losing out on compensation

The opposition party claimed that on average, more than 500,000 households and small businesses a year could be missing out on compensation from their energy company for inaccurate billing or poor customer service.

The official number of complaints made to the Energy Ombudsman service in 2013 was 17,948, while so far this year a total of 37,061 complaints have been made.

Labour stated that, using Ofgem’s statement that only five per cent of eligible cases are referred to the Ombudsman, there were potentially 358,960 complaints in 2013, and an estimated 741,220 up to September this year.

A customer complaint can be passed on to the Energy Ombudsman if a complaint remains unresolved or a satisfactory response has not been made within eight weeks of the initial complaint being made.

Of the complaints referred to the Ombudsman in 2013/14, 95 per cent were upheld and 76 per cent resulted in compensation being paid.

The Ofgem commissioned report stated that the reasons why eligible cases were not referred to the Ombudsman included: poor standard of suppliers’ communication; lack of awareness or incorrect perception of the Energy Ombudsman; and general complaints fatigue.

At the Energy UK annual conference today, shadow energy secretary Caroline Flint is expected to say: “It’s bad enough when the public have cause for complaint with their energy supplier, but for energy companies to refuse to compensate consumers or string out the complaints process for months on end is completely unacceptable.

“These figures lay bare the full scale of poor customer service and public dissatisfaction with the energy market.”
Responding to the claims, Angela Knight, chief executive of Energy UK, said Labour’s figures were “not a proper reflection of the facts”.

She stated: “It is wholly unacceptable to confuse genuine problems with people ringing up for explanations they get there and then. Eighty per cent of all queries are dealt on the day with just a single phone call.”

Knight added: “Our members are investing millions to improve customer service. It is outrageous to suggest they would deliberately prevent customers from getting redress where it is due.”