Stubborn Suppliers re direct debit amount

ScoobieGirl

I'm a bit of an anorak when it comes to my gas and electricity bills and check them often enough to have a really good idea of what my annual bills will be - even with price increases. So I change my direct debit to be 1/12 of the total plus a bit extra to be on the safe side.

However they always put it back up after a few months which always results me being in credit which they are difficult about refunding. Once suggesting that I might like to leave my £260 credit with them for another 6 months when they automatically look at my account.

They also tend to over estimate my bill except before a price rise when they underestimate it.

Anyone else have similar experiences?

Cardew

The vast majority of complaints of this forum are because the Direct Debit payments were too low and a large debit balance built up. Often this occurred because several successive meter readings were under-estimated.

Unlike you, many people have absolutely no idea about their gas & electricity bills.
I am also convinced that many simply do not understand the principle of the Direct Debit scheme. They think that the DD sum pays their bill in full and have not grasped the idea that it might only be paying part of the bill.

Xbigman

ScoobieGirl wrote:

I'm a bit of an anorak when it comes to my gas and electricity bills and check them often enough to have a really good idea of what my annual bills will be - even with price increases. So I change my direct debit to be 1/12 of the total plus a bit extra to be on the safe side.

However they always put it back up after a few months which always results me being in credit which they are difficult about refunding. Once suggesting that I might like to leave my £260 credit with them for another 6 months when they automatically look at my account.

They also tend to over estimate my bill except before a price rise when they underestimate it.

Anyone else have similar experiences?

My experience is exactly the same. What I used to do with Powergen was to phone up before they had a chance to take the new higher payment and get it put back down. This was a regular occurance every 3 months. I would use the phrase 'I do not authorise you to take that amount from my account and will call it back under the direct debit guarantee if you do'.
If you are not in arrears they have to back down because you don't owe them the money.
Regards



X

ScoobieGirl

Xbigman wrote:

I would use the phrase 'I do not authorise you to take that amount from my account and will call it back under the direct debit guarantee if you do'.

I like the sound of that!

Cardew

Xbigman wrote:

My experience is exactly the same. What I used to do with Powergen was to phone up before they had a chance to take the new higher payment and get it put back down. This was a regular occurance every 3 months. I would use the phrase 'I do not authorise you to take that amount from my account and will call it back under the direct debit guarantee if you do'.
If you are not in arrears they have to back down because you don't owe them the money.
Regards



X

Your approach is exactly correct in the circumstances you describe - where unjustified increases in a direct debit have been notified.

However there are many posts in this forum where people apparently do not understand the principle of the Direct Debit scheme and seem to feel that utility companies have no right to increase payments even when justified by an increased debt - or must seek agreement for any increase.

When you sign up for a Direct Debit(it isn't compulsory) you agree such payments as the company deem necessary. The company must of course notify you, in advance, of any change in your payment; but they are not seeking your agreement for that increase. Obviously you can object and try to negotiate. However if you cannot come to an agreement they are entitled to take that money and you may well have difficulty cancelling the Direct Debit.

If you then dispute their action under the Direct Debit guarantee it is up to the company to justify taking the money – but if they can justify it!!

ScoobieGirl

Cardew wrote:

The company must of course notify you, in advance, of any change in your payment; but they are not seeking your agreement for that increase. Obviously you can object and try to negotiate. However if you cannot come to an agreement they are entitled to take that money and you may well have difficulty cancelling the Direct Debit.

This seems entirely fair in the case of a debt. But I still don't understand thier motivation for doing it when I am already significantly in credit. I thought when I started this thread that the responses might hint that they were building up credit on a lot of accounts to earn themselves interest, however this doesn't seem the case so npower have gone up a little in my estimation.

Xbigman

I don't think there is a grand conspiracy to build up account balances, but I do think that all the major suppliers have set up computerized systems that tend towards over-estimation. They try to think up the worst case calculation for your usage, add a bit on, and charge you that amount. Its a bit pants really.

However, Cardew is correct. A lot of the people on this forum do not understand how the DD system is supposed to work. They also do not regularly read their meters, or at least check every bill. If you are in arrears and the DD goes up you have to pay because you owe them money. But if you are in credit it is a different story. You have a lot of grounds to argue it out with them. Ultimately you can cancel you DD mandate with your bank.
I've twice changed suppliers and 3 times in the last 18 months cancelled subscriptions/memberships. In all 5 cases I cancelled the direct debit mandate with my bank, in all 5 cases the companies tried to take another payment. I got burned once in 1990 and never since.
Regards



X

Cardew

Xbigman wrote:

Ultimately you can cancel you DD mandate with your bank.
I've twice changed suppliers and 3 times in the last 18 months cancelled subscriptions/memberships. In all 5 cases I cancelled the direct debit mandate with my bank,
X

Xbigman is correct, but just a point - you can cancel a DD with a bank, but be careful if you have a DD with a Credit Card company as the rules are different.

Technically I believe it is not a direct debit but a continuous credit authority and you must cancel it with the supplying company concerned and not the CC company. That is not a problem if it is an unjustified charge as the CC company will take the matter up on your behalf.