Consumer Focus response to MSE posts on E.On 'Spring review' DD scheme

backfoot

DirectDebacle wrote: »

As you are aware The Times ran a story in last Saturdays edition (27/1). I understand that this has generated interest and readers who are customers of E.On have come forward with their experiences. I expect that in the coming weeks there will be further and harder hitting articles than the first one. This will put E.On in the spotlight as well as DD problems and apparent breaches of SLC 27. and may well concentrate the attention of Ofgem.

The matter is certainly not finished yet but requires more involvement from E.On customers to keep up the momentum.

This is an excellent piece of news. Eon have had months of comment on this matter and have only recently moved their position. Initially,they claimed that it was a system their customer's favoured. :rotfl:

The stalling and intransigence of Energy Suppliers in the face of overwhelming evidence of abuse has been a feature faced before. Unfortunately it is a cultural thing even displayed towards Ofgem.

Perhaps they thought the argument would wither away but I am hopeful such complacency will result in some very firm action. That may be in terms of Regulatory clarity for the future but also in terms of penalties for complete non compliance with SLC27.

At many stages, we have asked Eon (when they were engaging with us), how customers have their changed DD's explained. Basically, they don't have a system, documentation or procedure to do this. Neither, upon query or complaint, do they provide a clear explanation other than a statement of generic policy. This is inadequate.

Recent history shows that Ofgem have been hard upon Suppliers failing to deal with complaints adequately or properly. I would imagine Ofgem will look very carefully at this sort of evidence from CF which leaves Eon very vulnerable.

This has not been a frivolous campaign. The arguments have been well presented and customer complaints were clear and plentiful. We will have to see what is the final outcome and I also think it is a test of Ofgem's credibility. Recent evidence shows me that they have been definately been much more vigorous in enforcement.

Recent sucesses on Gas Scutlpting, Termination Fees, Landlord Supplies and now this, show the power of this Forum and those that campaign simply for fair treatment for customers.:)

DirectDebacle

poet123 wrote: »

Sorry, not having been here from the off, but could you clarify what SLC 27 is and what it states? I am in the complaints stage with EON re incorrect setting of DD at the outset of my contract.

SLC 27 (Standard Licence Condition 27) applies to all suppliers and requires customers are provided with the information of the basis upon which their DD has been set.

SLC 27. is here

My view is that it requires suppliers to provide the customer with sufficient information to be able to check that their DD has been set correctly. The explanation should therefore contain the information the supplier used to arrive at the DD payment level i.e. facts, figures and calculation methodology.

If your DD is re-assessed (irrespective of whether it goes up, down or is unchanged) and you consider insufficient information has been supplied in the explanation then require whatever information you feel you should have. SLC 27 requires that suppliers must provide you with the basis upon which the DD is set.

This is a separate but parallel issue to the zero spring balance policy. As far as I can tell it is only E.On that are operating a zero spring balance policy but I haven't yet seen a DD re-assessment from any supplier that I consider meets with the requirements of SLC 27.

No doubt the legal teams of the suppliers would disagree.

In your case you should have had (IMO) prior to signing the contract with E.On a full explanation of how your DD had been calculated and a full explanation of the zero spring balance policy including an explanation of how it differs to a 'ususal' DD and how that difference can affect monthly DD payments over the year.

Blackdog

It's interesting that Eon give you a graph when they are increasing your direct debits of how they are set based on more consumption in winter and less in summer but do not provide a specific graph based on the customers particular consumption. In fact the graph is very misleading as it is headed very clearly "comparing your usage with your payments" but underneath (not so clear) it says "the information shown in this graph is for illustrative purposes only". So anyone looking at is led to believe that the graph represents their actual usage rather than a generic statement of how Eon would like it to be.

Blackdog

Here is an update on my own case which I had originally posted on another thread and emailed Customer Focus about.
I was £64 in debit and Eon informed me that they were going to increase my DD from £72 to £116. I emailed them to complain and after about a week they phoned me to say that if I wasn't happy about the increased DD then I would have to pay the debit balance. I therefore agreed to pay £64 by debit card over the phone and was told my DD would then be £80 which I thought was a fair amount. However they said that it was too late to change my January DD which they had already increased to £116 (which is very unfair because if they had responded to me quicker they would have had time to adjust the Jan DD). So in January I ended up paying £180!
In the same phone conversation I asked if the 6% decrease in electricity would apply to my tariff and they assured me that there would be a decrease but they couldn't tell me how much which is a bit strange as they clearly had made some assumptions on what the cost would be to set my DD. Since then I have found out that the discount will be around 1% so much less than the headline rate of 6%.

backfoot

Blackdog,

When did you first join Eon?

Have Consumer Focus given you any feedback ? Are you in touch with Colin Urquart about your case?

You have provided the precise evidence I talked about regarding Eon only giving generic explanations when your DD was raised and indeed after your complaint.

Also the unsympathtetic treatment that you must clear the balance immediately to resume your DD arrangement is not a valid complaint process.(basically bullying tactics)

Eon have no contractual term requiring this and you clearly should have been allowed to have the Debit balance recovered over a fair period of time and given a full calculation showing this and predicted charges. (even to your spring review).

I think your case is symptomatic of that sufferred by many eon customers and we need to ensure your case is looked at carefully by CF.

poet123

I am awaiting a callback re my issue, but EON cannot give me any details of how the figure of £141 was arrived at when I had told them (via Uswitch initially, but then via click through to their own website) that I was at that time paying £200.

They offered me £50 goodwill gesture, but I declined and so they are still searching their files for how the DD was set at that figure.

MisterCee72

Things are definitely starting to sound more promising.

Apologies for still not fully sharing my story yet but that will follow as and when E.ON make their supposed next move.

Very interesting that they are now offering customers "goodwill gesture" payments as they paid out £150 compensation (yes, they used THAT word) to settle our complaint.

Over to you E.ON.....

jalexa

DirectDebacle wrote: »

As far as I can tell it is only E.On that are operating a zero spring balance policy but I haven't yet seen a DD re-assessment from any supplier that I consider meets with the requirements of SLC 27.

I have a complaint 2nd stage email response which states that the Edf "annual review" date is (randomly) distributed from April to June. My personal "annual review" date is April (for a July start). I do not know if that is bad luck or unrandom distribution.:(

Personally I'm relaxed about "spring alignment" but not about short first year alignment, or short year alignment of tariff increases. In my case I have "self-aligned" my payments so that my (future) payments will be correct at the annual review date. IMO, the Edf notification (and requested explanations) do not comply with SLC27.14. Neither does the held assumption about annual consumption seem to be adjusted by actual readings, IMO another non-compliance witn SLC27. I have yet to be provided with the basis for the seasonal weighting of consumption used for the payment calculation (i.e. no E.ON "twitter table" for Edf).

Compared with forum reports of E.ON, it is not difficult to get Edf to reinstate the previous fixed payment as there is a general adviser recognition, when prompted, that the "dysfunctional" billing system is ... "dysfunctional".

However it is clear that the Edf system is attempting to perform "short year alignment", I assume by a signed-off systems design implemented by SAP, a self trumpeted "market and technology leader for business software". IMO this is the specific billing system behaviour which needs be brought to Ofgem's attention by Consumer Focus.

backfoot

jalexa wrote: »

Personally I'm relaxed about "spring alignment" but not about short first year alignment, or short year alignment of tariff increases.

However it is clear that the Edf system is attempting to perform (I assume by signed-off design) "short year alignment". IMO this is the specific billing system behaviour which needs be brought to Ofgem's attention by Consumer Focus.

The whole issue has revolved around short year alignment. It just happened that Eon have a stated policy to do this including tariff increases.

Spring alignment is fine for spring starters.

As most tariff increases in recent years have occurred pre winter, then customers are systematically penalised. Many customers switch on the back of price rise notifications, so then fall into Eon's trap.

Well done for teasing out the facts from EDF for your account. If indeed that is consistent with other customers. I have the impression that Edf's system was pieced together in dark rooms by a team of people working on bits of it independent of each other..:rotfl:

Ofgem are now looking at this thread and perhaps they will pick up that other Suppliers are jumping on the Eon lead. As you state, EDf are no more compliant on explanation under SLC 27 than Eon and have the added joke element of a random number generator.

It obviously needs Ofgem to get a grip of this whole area. They introduced (relatively recently) SLC 27 for the purpose of improvement of clarity of information.

It clearly isn't happening in more than one Supplier's case. These are sytem design failings, which given that EDf have just put their system in, shows either deliberate manipulation or incompetence.

Ofgem have only just reissued their DD help leaflet and these requirements are very clear to all.....except to Eon and EDF Managers.:eek:

I look forward to stage 3 of your complaint :T

poet123

Still no promised callback. They clearly have no idea how to explain how/why the DD was set at the much lower amount. So, as I have learned here, they are in breach of SLC 27. Where do I go from here?