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EDF direct debit manipulation

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  • snowcat53
    snowcat53 Posts: 602 Forumite
    edited 15 January 2013 at 2:06AM
    jalexa wrote: »
    You're right. (1125/125=9). Could that be a result of the actual date of the 'annual review' in relation to the payment date?
    The annual review date was around 16 dec, the interim re view on 19 sept, the DD payment date was 28th of the month starting dec 2011, so no reason for them to be confused
    jalexa wrote: »
    One other thing - this might be important - did the "£523.16 + £958.86" come from the "projected cost" amount at Page 5 of the 'interim review' statement?
    No it didn't. The page 5 amount (sept 2012) was 1567.05 (obviously excludes the warm home/.fuel saver discounts). So GOK where 523.16+958.86 (1481.72) came from. [No figure was provided in Dec2011].

    Many thanks to you and others for all your input.

    I have written back in detail demolishing their explanation, and asked for a formal acknowledgement of their error, an apology and a goodwill payment.

    They are demonstrably unable to explain the basis of their calculation or provide details on request . So breach of SLC 27.14 QED. But I don't see, unfortunately, any way we customers have to hold them to account or change their practice on this - this is Ofgem's roile and they are asleep at the wheel, and The Ombudsman is a victim of provider capture and/or too timid to challenge them
  • jalexa
    jalexa Posts: 3,448 Forumite
    edited 16 January 2013 at 3:32PM
    snowcat53 wrote: »
    "I can confirm the Direct Debit review that was completed ...

    ... This meant there was a shortfall between payments received and the estimated annual consumption. We automatically calculated what needed to be paid for the next two months to ensure that the account balance was close to zero by the time we completed the annual review.

    Just received my "explanation". Interestingly the first two paragraphs are indentical save for the personalisations. Numerically wrong as a matter of fact, structurally wrong depending on what is the policy.

    To summarise where we are, I can confirm the "contrived" explanation excludes all account transactions bar the regular direct debit payment amounts.

    Taking that as a "practice", I am satisfied in my case the automated calculation is "arithmetically correct". Of course I do not accept that the "practice" is reasonable because it results in the monthly payment being manipulated upwards, especially for customers who receive fuel credits during the payment year. The challenge going forward is to obtain disclosure whether that practice is "policy" (if so where it has been disclosed pre-contract) or is a latent systemic error.

    My manual explanation also exhibits "missing payment syndrome". The "divide by" figure is one less than it should be for the regular payments remaining, thus "manipulating" the payment upwards. Alternatively the most recent regular payment was not counted though it was clearly credited on the statement generated by the reading which triggered the 'interim review'. Two wrong figures (actually three) and the "contrived" result agrees with the automated result. :rotfl: I believe this shows the manual explanation is contrived to fit.

    The main issue going forward is whether it is "policy" that miscellaneous account credits, credited according to the statements (and account balance), are excluded from the direct debit calculation. And if so is the policy reasonable.
  • snowcat53
    snowcat53 Posts: 602 Forumite
    edited 16 January 2013 at 10:18PM
    Well done Jalexa. Very interesting that they have made the same error on number of payments to come and not counting other credits received.

    I have sent in my response now but another approach would be to challenge them and ask if this calculation was a) done at the time of the review or b) contrived /derived later. They are then in a cleft stick -
    if they say a) this is effectively proves their software/algorithm for reviewing the DD figure has a serious error;
    if they say b) then this was not what was asked for and you could again demand they produce it.

    I'm sure you're getting somewhere- keep pushing!
  • snowcat53
    snowcat53 Posts: 602 Forumite
    edited 16 January 2013 at 10:50PM
    Just in - further reply from the CS Director.
    Not yet fully digested but. I am sure they are wrong on the number of payments. The first payment was made late december 2011 after the initial setup so if they counted september's that should have been £1250 credited not 1125.
    I am inclined to reject this and fight on.

    The annual figures for your energy consumption are calculated using your last 12 months consumption. These include any Dual Fuel and Direct Debit Discount you are due to receive however, as your usage can change during the 12 month period, this figure may change on receipt of new meter readings.

    I can confirm the payments for Fuel Support and Warm Home Discount are applied to the account as £42.81 and £123.81 as we have to deduct the VAT for business purposes. To ensure our customers do not lose out on receiving the full amounts of £45 and £130, we calculate their next bill by deducting the discount from their energy charges meaning the VAT charged is less. I do agree this is confusing and this has already been fed back to our management team who are in the process of looking for this to be changed in future. [RESULT!]

    I would like to clarify the payments calculated of £1125 included your September payment even though it had not yet reached us. This meant there were only two payments remaining (October and November) and if your payments of £125 continued, would have meant we would have only received payments totalling £1375. Regrettably, Mrs X’s Warm Home Discount and Fuel Support payment are not included in the annual figures as they are not guaranteed to be credited to the account before the annual review takes place. This would have meant there would have been a deficit of £125 between payments made and the annual consumption. Therefore, I am unable to agree that the review was not necessary and I am sorry that you feel it was. [Still sure this is nonsense]

    Please accept my sincere apologies for the time it has taken for you to receive a satisfactory response and for this matter to be resolved. In recognition of the inconvenience you have experienced and the shortfalls in customer service encountered, I have credited Mrs X's account with a goodwill payment of £50.
    [I had suggested £75]

    Please let me know by return if you are happy to accept it and I will ensure the credit is applied to the account. Alternatively, I can withdraw the offer and formally confirm that we have reached a position of deadlock so that you can refer the matter to the Ombudsman Services: Energy

  • jalexa
    jalexa Posts: 3,448 Forumite
    edited 16 January 2013 at 11:57PM
    snowcat53 wrote: »
    Regrettably, Mrs X’s Warm Home Discount and Fuel Support payment are not included in the annual figures as they are not guaranteed to be credited to the account before the annual review takes place...

    I agree with that general argument but did you not say that Fuel Support had already been credited?

    I have rejected my calculation explanation, I didn't ask for and wasn't offered an ex-gratia payment. I now have a 'final response' and have already submitted my Energy Ombudsman complaint. Learning from your (and backfoot's) experience, the complaint is exclusively about the false representation of nett account payments made and the incorrect number of future payments. Matters of demonstrable fact so no "regulatory issues" to scare the EO.:D

    Just to confirm my automated calculation is exactly right if the statement page 5 projected cost is used and only regular direct debits are counted (I have quite a number of miscellaneous payments with a nett credit of just over one monthly payment). The manual explanation is "arithmetic rubbish", confused (and confusing:eek:) single fuel representations of a dual-fuel account, a past payment and future payment short:rotfl: but also only includes the regular direct debit payments made, so definitely corroboration of "practice".

    I am undecided whether the exclusion of miscellaneous account activity is by design or a latent flaw (I have a CS Director assertion that there is no flaw). In a sense it cannot be by design because of the explanation emphasis on a review balance and (in my case) the increased payment amount would result in a significant 'annual review' credit balance using Edf's own assertion of "energy consumption are calculated using your last 12 months consumption".

    That is assuming the explanations are "honest".

    Tomorrow I draft my Ofgem submission.
  • snowcat53
    snowcat53 Posts: 602 Forumite
    edited 17 January 2013 at 12:56PM
    jalexa wrote: »
    I agree with that general argument but did you not say that Fuel Support had already been credited?

    I agree with it for the 'annual statement' but at the interim review the £45 fuel support had indeed already been credited so there is no good reason not to count this as a credit when projecting the ned of year status.

    I am now highly suspicious about their good faith in these responses. When I challenge them they suddenly change their tack and claim they already had counted the september payment when it wasnt on the bill? Fortunately one can do the sums on that basis and show in that case the amount credited is wrong. This is just bone headed.

    I am going to write back one more time spelling out in as simple language as I can why they have got it wrong, If they still are obdurate it's off to the Ombudsman again. How stupid can they be?

    EDIT - now sent off. I suspect the reason for their miscalculation is that the DD appears on their statements at the end of the month but the collection is actually the beginning of th next month. Therefore they have omitted the first DD of 125 (28 Dec 2011 vs 3 Jan 2012) ! Will they have the humility and nous to admit their error or will they go to the Ombudsman?
  • jalexa
    jalexa Posts: 3,448 Forumite
    edited 17 January 2013 at 9:14PM
    snowcat53 wrote: »
    I am now highly suspicious about their good faith in these responses.

    I have an open mind about the "honesty" issue. I'm giving the same benefit of the doubt that I gave to your (and backfoot's) Energy Ombudsman decisions where I made allowance for a poorly funded organisation. The CS Directors's Team *may* be the sharpest tools in the CS toolbox but that doesn't make them sharp.

    Our "cut and paste" explanations both say "we automatically calculated what needed to be paid for the next <x> months to ensure that the account balance was close to zero by the time we completed the annual review". Except not counting payments already credited, and if necessary refunds, cannot deliver an accurate result. That's just plain arithmetic.

    The absurdity of the process is that if Victor makes an extra payment that is recognised as needed it will not count.:rotfl:

    BTW, I had a very small credit balance last review. On the basis of the "payments number" in the "explanation" it has not been counted. That implies that a credit balance of up to £150 per fuel at annual review is not counted:eek:.

    Regarding your missing payment, that is plausible. The most recent credited but not yet collected payment was clearly included in the full statement but not in the direct debit calculation even though the payments remaining was decremented as if paid and would have been fully collected come the review date.
  • snowcat53
    snowcat53 Posts: 602 Forumite
    edited 17 January 2013 at 9:59PM
    jalexa wrote: »
    I have an open mind about the "honesty" issue. I'm giving the same benefit of the doubt that I gave to your (and backfoot's) Energy Ombudsman decisions where I made allowance for a poorly funded organisation. The CS Directors's Team *may* be the sharpest tools in the CS toolbox but that doesn't make them sharp.
    .
    That's fair. And feeling generous I might concede that the date of DD on the statement being a different month to the date collected might confuse them
    jalexa wrote: »

    The most recent credited but not yet collected payment was clearly included in the full statement but not in the direct debit calculation even though the payments remaining was decremented as if paid and would have been fully collected come the review date.

    Sorry I don't follow that- would you mind rephrasing ?

    The basic point I put to them is that a 12 month period has 12 DD payments and none were missed - how can they count only 11? And 12 x 125 is 1500 which exceeds the estimated annual spend of 1482, so need to change DD amount. QED.
  • backfoot
    backfoot Posts: 2,700 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    snowcat53 wrote: »

    That's fair. And feeling generous I might concede that the date of DD on the statement being a different month to the date collected might confuse them

    Only if given from a made up explanation. ;)

    This is originally an automated process for which they never provide actual original details.The explanations are a moving feast.

    Like my calculation, yours is obviously flawed and their pitiful cover up fails even cursory examination. The level of the original increase was ridiculous and it's shameful that EDF continue this charade.

    They recognise this by offering you £50 to take it away but won't admit it is in error. They had hoped to avoid the EO case fee. You have to weigh up ultimately whether you want to accept and move on, bearing in mind that the EO awards are hopeless.

    Following the equally shameful complaint handling in my case, I invited Ofgem to review the detail of this thread. (and other associated cases).
  • jalexa
    jalexa Posts: 3,448 Forumite
    edited 20 January 2013 at 10:16AM
    snowcat53 wrote: »
    Sorry I don't follow that- would you mind rephrasing ?

    The basic point I put to them is that a 12 month period has 12 DD payments and none were missed - how can they count only 11? And 12 x 125 is 1500 which exceeds the estimated annual spend of 1482, so need to change DD amount. QED.


    My DD's are due on the 1st of the month. In accordance with BACS rules the originator requests collection approx 3 working days prior. The Edf "billing system" credits the payment when it is requested.

    I submitted meter reads on the last day of the month. This produced a Statement and triggered an 'interim review'. The Statement registered the requested (but not yet collected) payment as received "Thank you". The Statement provided a fully up to date (accurate I believe) account balance incorporating the customer own reads and the requested payment.

    The manual explanation for the calculation supplied a "number" (cumulative regular payments only) which did not include the requested payment. However the "divide by" number in the manual explanation was predicated on the requested payment having been included in the cumulative regular payments used for the calculation, so 1 less than the actual number of future payments. OK I don't think that is quite what I implied earlier. Well spotted.


    To add something, alluded to in a another thread. The Statement provides the statutory previous 12 months consumption as well as a cost projection for the next 12 months. That's fact. I think your recent post confirms being informed that is what Edf (claim) to use for the calculation. Except they seem determined to split a dual-fuel figure into separate elements. That is a far from trivial exercise since the discounts are added pre-VAT (and one discount is a dual-fuel fixed discount). Then VAT is added overall. The Statement projected cost is perfectly clear. The manual explanation is clear as mud. My "explanation" projected costs differ from the Statement. That is not acceptable.

    My view is that they were changed to make the numbers fit the automated calculation. Trouble is they had already made two arithmetic mistakes not made by the automated process.:rotfl:

    So misleading, whether or not they realise.
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