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BG direct debit increase when in credit!

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Although i'm £126.40 in credit with BG (Gas bill) I received a letter informing me that my monthly direct debit payments were being increased from £43.00 to £65.00!!! Where's the logic in that? After speaking to a chap from BG, he said that the lowest he could go to was £49.00 a month.

I asked if we couldn't leave it at £43.00 and then review it again in December 2008/January 2009. "No", was the answer. This seems so wrong.:confused:
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  • bmac
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    BG increased their DD payers bills by 42% when other gas customers charges increased by 35%. Their 'justification' for this was to close the gap between the lower charges levied on DD payers and the less well off on pre-pay meters, etc. The fact that many DD payers are well in credit is, I believe, a corporate decision made to increase their interest earnings on the parent company's bank balances. This is underlined by a quote from this website:

    "Since 2006, the interest income declared in their accounts by British Gas parent, Centrica plc, has gone through the roof - doubling from £40 million in 2006 to £83 million in 2007. Interest in their interim accounts for first six months of 2008 (£43 million) is 54% higher than the £28 million interest income reported for the first six months of 2007."

    I was paying £91 a month and was then told my DD was increasing to £132, a 45% increase, in spite of the fact that I was £294 in credit! A complaining email was never replied to but I switched tariffs and am now due to pay less for gas and electricity combined that I used to pay for gas alone.
  • basmic
    basmic Posts: 1,043 Forumite
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    Do what I do with Scottish Power.

    Ask them to work out your annual consumption, based on today's prices, using your meter readings and meter readings near-enough a year ago.

    If they say "oh you used £858 last year" I get the calculator out, divide by 12, and round to the next £5 - so, in this case, 858/12 = £71.50, so I'd ask them to set my DD at £75.
    Everybody is equal; However some are more equal than others.
  • JabT_2
    JabT_2 Posts: 116 Forumite
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    I've had similar with BG. I am £50 odd in credit and got a letter saying my DD would be increased from £36 to £81. I did the same as poster above, worked out consumption and total and divide by 12 (£62). BG wouldn't do that, they insisted on working out the consumption from now to the next review date (March apparently) and dividing by 5 (which being winter months are going to be the 'high' months). Defeats the object of paying by equal instalments. Anyway after saying I'd cancel DD they came to 'a compromise' of £72 which I don't mind for a month while I switch supplier!
  • Joyful
    Joyful Posts: 2,426 Forumite
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    The aim of any Direct Debit is to break even at the end of 12 months. This means if there is not enough credit built up through the summer it gets increased higher to get to the end point without a debit balance. I usually have over £100 credit built up before the winter which means that my DD is correct. If like you I was about to hit Winter and only had £50 Credit this means that the DD was set too low and they will add more on top of what you should have been paying to play catch up and break even in March at the end of your payment plan year.
    Self Employed, Running my Dream Jobs
  • pinkparrott
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    just refuse to pay it!! and get stroppy.
    last year we were £205 in credit with bg and it took us 3 months to get it back.
    Last quater we recieved a bill and we were £0.50 in debit and they put our dd up from £19 to £49 a month!! , i rang and refused to pay and spent nearly 1/2 an hour on the phone with bg, i insisted on speaking to a manager and was told there wasnt one there. in the end the advisor said there was nothing he could do, so i said i would just stay on the phone untill he ageed to my proposal as i knew he wasn't allowed to terminate the call!! not ideal i know but was so mad that they had previously hung on to over £200 of our money but as soon as we owed them £0.50 they upped the payments.

    In the end he put me on hold and then came back and said he had spoken to "his manager"!! (the non exsistent one)and could do £30 a month, so i said ok.b ut they sent me about 3 letters as they had to cancel my dd and set up a new one for the £30.

    It just annoyes me so much , as if you think of the millions of pounds of people money they must be holding on to. At the end of the day if you in credit stand your ground.
    Grocery Challenge Feb 14 £500 / Spent £572.10!
    March 14 £500 / spent £488.45 :j
  • Cardew
    Cardew Posts: 29,042 Forumite
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    bmac wrote: »
    BG increased their DD payers bills by 42% when other gas customers charges increased by 35%. Their 'justification' for this was to close the gap between the lower charges levied on DD payers and the less well off on pre-pay meters, etc. The fact that many DD payers are well in credit is, I believe, a corporate decision made to increase their interest earnings on the parent company's bank balances. This is underlined by a quote from this website:

    "Since 2006, the interest income declared in their accounts by British Gas parent, Centrica plc, has gone through the roof - doubling from £40 million in 2006 to £83 million in 2007. Interest in their interim accounts for first six months of 2008 (£43 million) is 54% higher than the £28 million interest income reported for the first six months of 2007.".

    You believe that Centrica, via BG, are making that income from domestic accounts in surplus?


    No doubt this will get repeated and repeated until it becomes an established 'fact'.

    Are you not aware that CAB and other 'social' groups have been savage in their criticism of all the Utility companies for doing exactly the opposite of your accusation - i.e. letting too many DD customers get massively into debt.

    Read through this forum and by far the majority of complaints are that huge debit balances have built up(£hundreds/thousands) and are repaid over one, two, or several years - interest free of course.

    The other 'theory' banded about is that the Utility companies set their DDs deliberately low so that customers get into debt and cannot switch.

    Seems like 'damned if you do and damned if you don't'

    Why not contact ofgem and report Centrica for such abuse; you might get an interesting reply.
  • Incisor
    Incisor Posts: 2,271 Forumite
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    Cardew wrote: »
    You believe that Centrica, via BG, are making that income from domestic accounts in surplus?

    No doubt this will get repeated and repeated until it becomes an established 'fact'.

    Are you not aware that CAB and other 'social' groups have been savage in their criticism of all the Utility companies for doing exactly the opposite of your accusation - i.e. letting too many DD customers get massively into debt.

    Read through this forum and by far the majority of complaints are that huge debit balances have built up(£hundreds/thousands) and are repaid over one, two, or several years - interest free of course.

    Why not contact ofgem and report Centrica for such abuse; you might get an interesting reply.
    I believe it. There is an apparent inconsistency, but it is very easily explained. Some customers are kept in credit by massive amounts and others are allowed to get into debt by massive amounts. Being cynical, those who appear to be affluent are probably milked for every penny of credit BG can get away with, as they are less likely to complain. Those who show signs of financial distress are probably allowed to get into substantial debt, because it makes them far less able to switch.

    Of course this problem would disappear overnight if the utilities published the method for calculating monthly payments. The fact that they don't and that this causes considerable burdens on call centres and that most changes to monthly payments appear to be randomly generated in the utilities favour all make me think that they are up to no good.
    After the uprising of the 17th June The Secretary of the Writers Union
    Had leaflets distributed in the Stalinallee Stating that the people
    Had forfeited the confidence of the government And could win it back only
    By redoubled efforts. Would it not be easier In that case for the government
    To dissolve the people
    And elect another?
  • Cardew
    Cardew Posts: 29,042 Forumite
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    Incisor wrote: »
    I believe it. .

    Then report it to OFGEM.
  • MarkyMarkD
    MarkyMarkD Posts: 9,912 Forumite
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    The best way to avoid always feeling that you are being hard-done-by by your energy supplier, is to switch suppliers in the autumn, not the spring. If you do so, you'll be underpaying for the first six months (building up a nice debit balance) and then overpaying for the next six months until your balance gets back to zero. At no point should the supplier owe you money.

    If you DO choose to switch at any point in the year other than autumn, there will inevitably be a time when your account is in credit. But that doesn't mean you've paid too much - it's a necessary consequence of a flat monthly payment scheme.
  • Incisor
    Incisor Posts: 2,271 Forumite
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    Cardew wrote: »
    Then report it to OFGEM.
    :rotfl::rotfl::rotfl: Would you care to predict an outcome? I manage to deal with my own utilities satisfactorily, despite the DD games they like to play, so I don't feel the need to do more than post my opinions here.
    After the uprising of the 17th June The Secretary of the Writers Union
    Had leaflets distributed in the Stalinallee Stating that the people
    Had forfeited the confidence of the government And could win it back only
    By redoubled efforts. Would it not be easier In that case for the government
    To dissolve the people
    And elect another?
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