MSE News: Energy cashback saved from total Ofgem ban

Consumerist

scootw1 wrote: »

So everyone loses out because people can't be bothered to combine the results of a comparison with the cashback website amount to get the best deal? I feel a backlash against the regulator coming on from those of us who do a full comparison as opposed to a half-hearted one.

I think Ofgem's objective is that cashbacks are an inducement to use the comparison site as opposed to an inducement to switch to a particular supplier.

Clairabella

[My provider has this policy and perhaps all the others do too. In which case if you are moving to a more expensive tariff leave it to the last minute.[/QUOTE]

By waiting, you may well have missed out on the the best long term fixed tariffs as the providers have been ending them.

canterswest

Thanks for the advice I will double check what I am charged by my previous provider. I looked in early October and what was being advertised then as 'cheap' fixes were the same prices more or less quoted in late December! Is it a bit smoke and mirrors? Home insulation means we use well below average. Do you think today's announcement about new tariffs means I should ring around for more quotes!! I have a week to change my mind. Apparently tariffs no longer have a high introductory rate - would that count against a low usage home like ours meaning I should check what's available now since Ofgem's intervention?

chanz4

MSE_Archna wrote: »

Hi all

We campaigned on this purely because it was an anti-consumer decision. Removing cashback would likely mean less people switch, in a market where lots of people are still reticent about taking action on their bills. The cashback is effectively giving consumers a cut of the amount the comparison sites earn for switching people. Where the cashback isn’t paid, comparison sites can simply keep the entire amount.

Our decision to campaign on this was made completely independently of Moneysupermarket – just as all editorial MSE work is, as set out clearly in our editorial code.

So how much does MSE make from the Cheap energy club switches? And how much does moneysupermarket?

canterswest

I presume as the article says commission is £40 and Energy Cashback Club pays £30 if it switches you that MSE keeps £10?

Quentin

chanz4 wrote: »

So how much does MSE make from the Cheap energy club switches? And how much does moneysupermarket?

What difference does that make to anything here?

(Or do you have a vested interest in dissing the CEC's service, bearing in mind your own association with the company who's name cannot be mentioned outside its dedicated thread which never appears as a recommended company to switch to?)

The CEC does point this out to all its members:

You may be able to get extra cashback using alternative comparisons

Sometimes it's possible to get more than the £30 cashback Cheap Energy Club gives for switching your energy tariff.

Consumerist

canterswest wrote: »

Do you think today's announcement about new tariffs means I should ring around for more quotes . . . .

Ofgem's proposals have been in the making for more than two years so the energy suppliers had made the necessary changes to their tariff structures long before today. Ofgem have chosen today to issue a press release because 1 Jan 2014 is the deadline by which suppliers must comply with the new requirements..

scootw1

How about ofgem stop fiddling with stuff which is right and working for the majority of people and start tackling the real issues in the industry such as vastly over inflated prices and wages and extremely poor customer services?

james_joyce

There must be a scenario where a supplier actually becomes cheapest BECAUSE of their cashback. Is Ofgem seeking to prevent that happening, ie stop the consumer choosing the cheapest supplier?

Consumerist

One consequence of the Ofgem ruling is that cashback cannot now change the position of a supplier in the comparison list because cashback must be offered equally on all switches. i.e. cashback does not influence the consumer's switching decision.

So now the cashback sites must compete with each other for switching business. (Or they must stifle competition between them by colluding with each other on the cashback they will offer.)

This could be an interesting scenario developing which could, for example, start a switching cashback war between the switching sites.