Energy Companies Allegedly Misuseing Direct Debit Scheme

Cardew

Incisor,

Lets us not keep repeating the principle as I, and everyone else, have conceded that if a DD scheme has been changed there can be a cash flow problem for some customers; so that is a given.

We have also firmly stated that changing the DD scheme is wrong and there should be clarity.

However to put the financial aspect into perspective, will you concede that under your worse case scenario it will cost the average customer £4 a year in lost interest? and they gain £84 in DD discount?

If not what are your figures?

Stoupa

Oh dear - thread deteriotating big time- do you all work for energy companies!So much jargon and not a lot of sense.

backfoot

MarkyMarkD wrote: »

Rather than the pressure (from the Conservative MP and the like) being to have a general kick-about of the suppliers, maybe there should be an increased emphasis on:

(1) transparency - i.e. a proforma calculation must be provided every time a DD amount is set; and
(2) consistency - i.e. however many reviews there are during the year, they must always be looking forward to a consistent plan end date.

It doesn't bother me if that plan end date is consistently set by the suppliers as March, which would benefit them the most and mean that most customers would permanently be in credit. That's a price customers might choose to pay for the DD discount.

Comments like these make me more determined to get involved and to the very bottom of why our DD's are increased unnecessarily. It's because it's almost impossible to get a staight answer to a straight question that customers eventually get their MP's involved or whoever may be able to help.

I have tried three times to set out some simple questions relating to my case with BG. In all cases, I received totally non relevant replies based around proforma letter templates.The latest explains how we have got to the balancing numbers for electricity for today's prices up to the December review, but it doesn't even attempt to clarify what caused or prompted the 'ghost' increases back in July/August.

The reply even quotes a spurious reason of the price increases. These were not applicable to CE 5 at the the time of the DD increase.Indeed I have only just received formal notice of that change.The other interesting point is that they confirm the review point for this account is December,so why were they altering DD's in the summer period? You will also note that they didn't even address the rise in the DD on the Gas Account in the response,which was the most pertinent point.

For information I have copied down my questions and the response.

"Dear Reshma Thube,

All you have done is quote a standard letter/script to me and failed completely to answer the specific questions. It is really quite embarrasing to be presented with such an inadequate reply after I have taken the time to put my concerns in writing,not once but twice.I will now try once again and trust that you will address the issues raised.

1. The direct debit reassessment for gas occurred after my change to Click Energy 5 from your standard tariff. That tariff is considerably cheaper and therefore I expected the DD amount to drop. In fact, it increased initially to £44.00 from £38.00. After complaining and submitting a meter read it has dropped back now to £30. The previous quarters bill was produced using an actual read. There was a credit at time of almost £100 which represents around one third of the annual bill.The specific question is why did it rise at all?

2. The electricity account also moved up from £20 to £25 and then a further letter was received asking for £35 !! Why was that, when the account is only marginally in debit? I calculate that a sum of £23 will cover the small arrears and cover the next twelve month's consumption.A calculator is sufficient to work this out not a computer.Please amend the DD down to £23.

3. Essentially what caused the increases in DD when there was absolutely no reason for this to occur on moving to your Click Energy tariffs which are some 25% cheaper. Hopefully this time you will actually apply proper Customer Service and read and respond to my legitimate queries."

Thank you for your email about the Direct Debit on your gas account. Please forgive my late reply.
Considering your last year’s electricity consumption, and taking into account our recent price increases, we expect you to use £240.55 this year and adding VAT of 5%, your total consumption amounts to £252.57. After adding the initial balance of £3.16 and reducing the payment of £190.00 you get the total of £65.73. After dividing this amount by the remaining 2 instalments left on your electricity account, you get the monthly payments of £32.86 approximately. After reviewing your electricity account, we confirmed your payments were to increase to £30.00 per month. Your annual reassessment is due in December 2008.
Thank you for contacting us.
Yours sincerely
Ryan John

The inablity to answer the clearly raised and simple points just makes me entirely suspicious of the whole process. Doesn't it you?

Cardew

backfoot wrote: »

The inablity to answer the clearly raised and simple points just makes me entirely suspicious of the whole process. Doesn't it you?

Depends what you mean by suspicious!

Nobody is disputing the figures in your individual case.

However two of us posted last month in a thread that BG had inexplicably reduced our DD payments without any justification.

I have been on a fixed rate for 3 years and my consumption has been steady over that period with no estimated meter readings.

One of my DDs reduced from £43.50 to £35 and someone else had an even more dramatic reduction.

I also posted earlier that I will emerge from the winter well in debit with BG.

Personally I think that the BG computer system is STILL a mess in some applications and it throws up silly results. Instead of admitting this you get equally silly explanations from some of their staff.

So IMO the c0ck up theory has more credence than the conspiracy theory with BG at least.

backfoot

Who knows !!!! up or not.

What is tremendously galling is the sheer contempt that Customer queries receive. Even as a fan of BG, Cardew you have to admit that at the third time of presenting fairly straightforward questions someone could have grasped the issue.

This is a huge organisation with money to burn on IT,marketing and good salaries and should be able to do far far better. :rolleyes:

I have now given notice to BG of a switch but I am going to continue to pursue an explanation,be it !!!! up or not.At the moment,all I get is an answer to someone else's question.....lol.

backfoot

Because it is a totally relevant case connected with DD abuse,I have once again tried to get an answer from BG. I have sent the following mail to them.

I don't hold out much hope but as in other cases, I will follow this up with the relevant parties.

'You will note previous correspondence about DD payments on the gas and the electricity account.

As I have not received a substantive answer to the very specific questions raised, I intend to put forward my details both to Ofgem and to the MP Peter Luff who has raised questions recently about the abuse of DD's by Utility Companies.

I am willing on this fourth occasion to receive a valid and plausible explanation to the following simple questions:

1.During August, I received notification of increases to DD's on both gas and electricity accounts.What prompted those increases,when your own letters have told me that my review point is December?

2. Why did you raise the DD's against the background that I was moving from your own standard tariff to your much cheaper online Click Energy 5 tariff?

3.Why was it deemed necessary to increase the gas DD when the account stood at £98 credit?

4. Why have my previous clear questions been ignored? I realise that amounts have been reduced now after my complaints, but I was asking for reasons/justification for you raising them originally.

I look forward to a substantive and meaningful response before deciding whether to pass on these details to the parties mentioned.'

I will let you know of any response.;)

1carminestocky

More power to your elbow, backfoot! BGs utter refusal to explain how their DD adjustment system works is just extremely dodgy and no amount of foot-stamping by the usual apologists on here will convince me otherwise. Why the big secret?

BallandChain

I like your style Backfoot. Please keep us up to date on the response you get from BG, your MP and Ofgem. I know what you mean where they ignore the main points of your letter. I had to send several e-mails to South East Water as they kept ignoring my questions! Also, I e-mailed EDF about my electric a/c and requested the DD be amended. (It was set at £30 when we first moved in but we soon realised we needed to up the DD to £50 a month, though I still think this might be too low.) They didn't amend the DD so I had to write again! I swear these people don't bother to read your letters and just throw out a bog standard reply.

backfoot

Thanks Guys,

I haven't had a problem with BG before because I have steered well clear of them on price and customer service history.This is actually the account of my elderly father in law,who I encouraged to use BG, so when it went pear shaped, it caused me undue embarrassment and work.Anyway it matters little,the principle is the principle.

Like our friend ,DirectDebacle, I have fought other hard battles with several organisations,both utilities and financial,where initially presented with a stonewall defence,they have ultimately crumbled and have had to face both financial penalty and bad press.

At this stage,all I am trying to do is get at the facts. Not even they are forthcoming from BG. It will then all add into the melting pot as to whether there is a systematic abuse going on and whether policy has changed to make this occur.

It doesn't bother me in the slightest if the BG employees/utility lovers question my case.Indeed I think it's largely helpful because it ensures I haven't missed anything. So far, nothing has come to light and to be frank it does look pretty clear cut.

My thought is that their computer system is now written in such a way that any change causes a trigger point for a DD review. In my case it was the move to CE5 from standard. I suspect that the DD assessment program then heavily weights consumption into winter quarters and wants you in credit during that period,whatever your original review date may have been.

The number of complaints have escalated dramatically over this issue and its not all down to misunderstanding of the DD system. Just the examples quoted over these few pages by knowledgable contributors demonstrate something is amiss.

Anyway,most people come on here for help from the misery that these utilities cause. Those who constantly deny wrong doing/fault/blame or nitpick faults for the sake of it, do their own credibility very little benefit imho.Once again thanks for your clear support.:T

bristolleedsfan

Nice one Backfoot:T Ive just escalated my complaint as well.



Andy Eley
Head of Complaints


1 December 2008



Account no: 8500........


Dear Mr. Eley

Complaint about British Gas misusing the Direct Debit authority I trusted them with by requesting totally inappropriate Monthly payments, showing no apparent regard for my individual circumstances, not providing me with a honest or truthful explanation since November 6th, making no attempt since November 6th to set my Gas payments at an appropriate level merely throwing me on Quarterly billing as some form of apparent punishment thus forcing me to apply to switch to Scottish Power who have already informed me that my monthly direct debit will be set at a level based on the consumption that I have detailed them with.

Background: I live alone in a 3 Bedroom house; I was brought up to dress for the weather and I totally agree with Centric as reported advice about wearing extra Jumpers in the winter to save on heating costs.

http://www.independent.co.uk/news/business/news/how-to-beat-60-rise-in-gas-prices-wear-two-jumpers-says-energy-boss-871805.html

Only in extreme cold weather would I put the heating on, I eat out

I have both years of previous years records as a British Gas customer and have been a British Gas customer previously during the last two years, so British Gas do have a record of my previous Gas consumption.

On previous occasions that I have switched to British Gas, British Gas have always contacted me to agree a monthly direct debit amount, During this latest switch to British Gas I was neither contacted during the switch in process nore did I receive any notification of the amount that British Gas planned to request every month in respect of Gas, I did receive such a notification in respect of Electricity which itself was lower than my normal consumption. (I have recently embarked on an Electricity use reduction exercise anyway)

Why did British Gas request 69.00 in respect of Gas from my Bank Account on or around 5th November 2008?

Why did I receive no prior notification that the above behaviour was to occur?

Why since 6th November have I not received a truthful and honest answer as to why the above occurred bearing in mind my own circumstances/lifestyle?

Why since 6th November have British Gas totally ignored what I have told them regarding my nominal Gas usage and made no ( Zero) attempt to set my Gas direct debit payments at a reasonable level.?

Do British Gas agree that they have no divine right to receive advance credits per customer of up to 200.00 and that ultimately it's the customers responsibility to ensure that their energy monthly payments will cover their usage and/or be able to meet any shortfall on demand by the energy company rather than British Gas merely receive interest free credit from its Direct Debit Customers?

Why has British Gas only apparent response to my complaint which also included me asking my Bank to reverse the totally inappropriate monthly payment demand from BG on 5th November, canceling the direct debit to prevent any further apparent excessive and inappropriate payment requests from British Gas been to throw me on the more expensive quarterly billing tariff ?

Since I made my response to BG payment request from my Bank account on 5th November as detailed above British Gas have asked me for a meter reading on two occasions, Why despite these actions have British Gas still not suggested an alternative monthly payment amount ?

Why despite no money owing, no apparent Gas used does British Gas apparent pathetic billing system say that I owe 66.67

I have now applied to switch to Scottish Power who have informed me that they propose to request a monthly direct debit of 32.50 for combined Electricity and Gas. Can you confirm that British Gas have registered my rejection of its apparent price increase that occurred when it threw me on its Gas Quarterly Billing tariff and that I will be charged at its Dual Fuel online, paperless billing, direct debit tariff during the switch out process.?

Should I decide to switch back to British Gas in the future what guarantee can you give me that British Gas will not abuse any future direct debit authority that I may furnish them with by only requesting Monthly payments that have been agreed in advance based on MY previous consumption?

Do British Gas agree that I applied to go on its Dual fuel/monthly direct debit/paperless tariff in good faith and had British Gas either/or/both contacted me to agree a monthly direct debit amount/ fixed the monthly direct debit amount based on my recorded previous consumption I would not have had to endure the subsequent stress/anxiety/worry/ time wasted emailing and writing complaints and that British Gas should in the circumstances credit my electricity account 8500....... with appropriate compensation for the stress/worry/anxiety it has caused me and the time I have wasted emailing and writing complaints.

I look forward to both your response and information as to when British Gas believe that its complaints procedure has been exhausted.


Yours Sincerely



CC:

Sam Laidlaw Chief Executive Centrica