British Gas wasting our money

IvanOpinion

Older_but_not_wiser wrote:

Surely it would have been more cost effective to include this information with the next bill, or e-mail the customers who are registered online with them.

I get the impresion that inclusion on the next bill, while a very sensible and money saving idea, does not meet legal/regulaory requirements. It has to be a separate mailing

Ivan

Paul_Higgins

Here is a transcript of the letter I have just sent to them-

Dear Paul Bysouth,
I have just received your communication of December 2006 referring to ‘Important changes to your Terms and Conditions’. I quote ‘From 1st March 2007, British gas will be introducing a late payment charge of £5 for late-paying customers, an approach similar to that taken by many credit companies where payment is late.’
You go on to explain how we are billed for energy after we have used it. I accept your premise that we are using fuel yet to be paid for, and I also accept that you should expect prompt payment. However, I must take issue with certain aspects of your communication. I have as a single parent found myself financially embarrassed at times and have met with nothing short of courtesy when contacting British Gas to explain my difficulty paying a bill and help to do so. My issues with your communication are several. Firstly, you are surely aware that other energy suppliers are constantly contacting British Gas customers with a view to changing their utilities supplier. This will not endear existing customers to you and while you do explain that this is a current policy with other credit accounts, there will be those companies that could use this to persuade your customers to transfer their accounts. I would also like to add that I pay my account by direct debit. This, I presume would mean that the late payment fee would not, or could not apply to me. Assuming you have many customers who use the direct debit method of payment and they have all received a similar notification then I would also make the assumption that postage fees apply to those letters. Is this a responsible use of funds which we all pay towards through our payments?
Where you say (and again, I quote) ‘the £5 charge represents our additional costs when a customer has not paid a bill within 28 days of the bill date’ I would be grateful if you would send me a breakdown of the additional costs. While I accept there are other expenses, sending a reminder statement does not amount to £5 at face value.
Further, my gas account is currently £90 in credit. My electricity account with you is in the region of £60 in credit. Will you send me the money I am in credit with each month? I may decide to require a payment of £5 every time my account is in credit and I do not receive the outstanding balance before my next bill is due. I have, in the past been met with some resistance when requesting outstanding credits to be paid back to me. This is, essentially my money which you are at liberty to use and I am not. It seems to me that once again, our capitalist system is penalising the less fortunate, who may genuinely not have the funds to make payments by the required date and the more affluent will not be affected since they would, by definition have the means to pay promptly.
To finish, a system was introduced in the Irish Republic some years ago (though I admit I do not know if this is still applied) where prompt payers were rewarded with a credit towards their next bill (£10 I believe) rather than a penalty for late payment. Perhaps you could consider a similar arrangement, where prompt payers were rewarded, those who paid within a reasonable time were neither rewarded nor penalised and late payers were penalised.
I look forward to your enlightening reply.


Copy, and send it to Paul Bysouth. I have tried, unsuccessfully to send it direct to Paul. send it to Paul Bysmith, care of Btitish gas.

IvanOpinion

Paul, I think you have just wasted an afternoon thinking all that up. I have checked and informing all customers of £5 charge is a legal requirement ... and BG are not the only ones that will be going down this route. In reference to your prompt payer/early settlement discount there are significant marketing advantages in providing a price that, should someone break the T&C incurs a surcharge, over providing a price that should you pay on time will be rewarded. The advantage is that they can show a smaller underlying price which can move their rating up on broker sites such as Uswitch etc..

In relation to a breakdown of costs I would suggest £5 is actually very fair and on the low side of what I would expect. Someone has to pay for the CS staff, the computer systems, the reminders, follow up letters, cost of paper, postage, envelopes, printer ink etc. .. and don't forget they have already had to send out the letter telling you about the £5 charge and that will have to be covered (which they had no choice but to do).

While big mailings will attract large discounts (walksort & mailsort) they will have had to mail all Xmillion of their customers .. so to send this letter out will probably have cost several million quid.

I know of serveral companies that are actively trying to 'dump' poor paying customers. They can then offer better prices to good customers which in turn will bring in a new client base. This may not seem fair, but even this site would have to agree with the policy since it will save those that meet their obligations money ... I have always been a firm believer of gettnig the lowest possible price and then paying extra for additional services if required .. which is why in some circumstances I think 0870 numbers are a good idea

ivan