Campaign to ban Standing Charges

matelodave

Why pick on older people - there are probably just as many, if not more, younger people who dont understand their bills. TBH they really shouldn't be all that difficult to understand especially if you put the effort into reading and checking them regularly.

Most of the older people you are denigrating could quite happliy work out pounds shillings and pence as well as yards, feet and inches therefor multiplying the cost of a kwh by the number uses should be easy, likewise multiplying the daily s/c  by the number of days is also a doddle. Many of them could probably use a computer as well rather than just poking graphics around a screen.

Where people seem to fall down is understanding the difference between a standing order and a bill or the difference between typical, average, estimate and actual.

[Deleted User]

busybee100 said:

[Deleted User] said:

busybee100 said:

Deleted_User said:

busybee100 said:

Lots of disingenuous arguments here.

It's periodically touted that petrol and diesel should include an amount to contribute towards the infrastructure ie. higher users should pay more. As it is because it comes from taxes we each pay a different amount based on our income. The parallel would be to pay a standing fee based on income but that isn't going to happen.

Someone's suggested a shopping comparison which is completely unrelated, apples and oranges.

Regardless of winners and losers it should be easier to compare. Either a flat rate for everyone or built in to the unit price.

If it's to be a standing charge it should be small enough it doesn't really impact the low user. 

Note. I only get a good deal at the expense of someone who can't or doesn't compare tariffs. One day I will be that person. So will you.

Why?

If it's to be a standing charge, surely it should be the actual cost - not some arbitrary small number that will affect some and not others.  All that does is to but yet another break-point.  How small would not "really impact the low user"?  I'm sure you could pick any number and some would say that it is unaffordable, or pointless, or just out for profit, or all the usual things.

The disingenuous arguments on this thread all appear to come from one point of view, which unsurprisingly you seem to be agreeing with.

Disingenuous on one side, as in you don't recognise the comparisons are not like for like?? 

There's not just an either or here, the problem is the standing charges are not the same for everyone. It needs addressing.

The arguments being given are to accept it in it's present form or completely absorb it into the unit price.

Alongside that is the argument to encourage lower use.

And more importantly enable people to compare prices and encourage them to use unit prices to work out their costs.

If you can tell my POV, go for it 🙄

The standing charges are not the same for everyone because the directly attributable costs are not the same for everyone.  Absorbing it into the unit price doesn't fix this, and just removes a point by which suppliers can compete.

Why is there always this repeated false argument saying that the way to encourage competition and switching would be to effectively ban suppliers from offering different types of tariff?  What's wrong with a supplier having a lower SC & higher UR tariff alongside their 'normal' one and then letting customers choose?

Having a lower unit rate encourages lower use.  You don't need to do anything to the standing charges to have that effect.

And disingenuous in the form of determining that an analogy is false and inappropriate because it is not precisely like-for-like (of course it isn't, it's an analogy) when used to disagree with their perspective. yet then using an almost identical analogy in the following paragraph to support their position. 

There you go again, you keep putting words in my mouth. I never said anything about encouraging competition. 

The benefit of having uncomplicated tariffs is to make it easier for the consumer. Many older people cannot understand their bills. The more complicated you make the system the more you ostracise them, the more they can be taken advantage of.

We are a consumer site. Should we not advocate for all consumers? 

I don't understand how "a lower unit rate encourages lower use" that just doesn't make sense.

Yes, that was a typo - it makes no sense at all.  I started to write that having a lower standing charge doesn't encourage lower use, then changed my mind but didn't fix it properly.

You didn't mention competition, but the previous posters in this thread certainly did - and we were discussing the whole thread not just your individual point.

Many people don't understand their bills.  Many of these same people will continue to fail to understand their bills if they were written in letters 100 feet high, only contained ten words, and were hand-delivered and personally explained.  It isn't beyond the wit of man (or it really shouldn't be) to understand the concept of paying an amount per day to have the service connected, plus paying for the fuel you use.

It really depends what you mean by advocating for all consumers.  I think that the consumer is better served by having the items separate, where different tariffs can be offered that can better suit their own circumstances, and where each component can be easily seen so there can be identification of efficiency and (hopefully) an overall cheaper price.  I don't think the consumer is best served overall by fudging the entire complexity of the industry into a single number and restricting the forms of tariffs that can be offered, just for the benefit of making comparisons slightly easier.

wittynamegoeshere

[Deleted User] said:

busybee100 said:

Deleted_User said:

busybee100 said:

Lots of disingenuous arguments here.

It's periodically touted that petrol and diesel should include an amount to contribute towards the infrastructure ie. higher users should pay more. As it is because it comes from taxes we each pay a different amount based on our income. The parallel would be to pay a standing fee based on income but that isn't going to happen.

Someone's suggested a shopping comparison which is completely unrelated, apples and oranges.

Regardless of winners and losers it should be easier to compare. Either a flat rate for everyone or built in to the unit price.

If it's to be a standing charge it should be small enough it doesn't really impact the low user. 

Note. I only get a good deal at the expense of someone who can't or doesn't compare tariffs. One day I will be that person. So will you.

Why?

If it's to be a standing charge, surely it should be the actual cost - not some arbitrary small number that will affect some and not others.  All that does is to but yet another break-point.  How small would not "really impact the low user"?  I'm sure you could pick any number and some would say that it is unaffordable, or pointless, or just out for profit, or all the usual things.

The disingenuous arguments on this thread all appear to come from one point of view, which unsurprisingly you seem to be agreeing with.

Disingenuous on one side, as in you don't recognise the comparisons are not like for like?? 

There's not just an either or here, the problem is the standing charges are not the same for everyone. It needs addressing.

The arguments being given are to accept it in it's present form or completely absorb it into the unit price.

Alongside that is the argument to encourage lower use.

And more importantly enable people to compare prices and encourage them to use unit prices to work out their costs.

If you can tell my POV, go for it 🙄

What's wrong with a supplier having a lower SC & higher UR tariff alongside their 'normal' one and then letting customers choose?

What's wrong with it is what I've repeatedly pointed out and that you and a few similarly vociferous defenders of the industry on this forum appear to be deliberately deaf to.

It obscures the pricing, making price comparisons near impossible, so stifles competition and ultimately results in consumers paying more.

I'm all for competition, but let's not insult everyone's intelligence by pretending that the energy market in any way resembles a free market.  It's a contrived load of nonsense thinly spread on top of a formerly state-owned monopoly industry with massive amounts of regulation and subsidy already.  The suppliers have been using their freedom to make their pricing opaque and baffle customers.  In this case regulation would result in free and fair competition that doesn't currently exist.

If, by whatever means, customers could easily understand and compare prices then more customers would switch and prices and profits would be forced to reduce.  The average person in the UK knows how much they pay each month by DD and that's the limit of their understanding, because beyond that level it's baffling to most.  If the SC component was either zero or a standard amount then everyone could compare unit costs, no computer required.

The idea of free markets isn't a fundamentalist religion, where anyone questioning any element of the staus quo is an enemy non-believer.  It's something that should serve the public interest and usually does require government regulation to prevent anti-competitive practices by dominant suppliers, that's why all governments have departments that monitor and regulate pretty much every market.

[Deleted User]

wittynamegoeshere said:

It obscures the pricing, making price comparisons near impossible, so stifles competition and ultimately results in consumers paying more.

It does precisely the opposite!

The bill has two components.  Showing the price of both components really isn't "obscuring the pricing" - it's making it blatantly obvious.

busybee100

matelodave said:

Why pick on older people - there are probably just as many, if not more, younger people who dont understand their bills. TBH they really shouldn't be all that difficult to understand especially if you put the effort into reading and checking them regularly.

Most of the older people you are denigrating could quite happliy work out pounds shillings and pence as well as yards, feet and inches therefor multiplying the cost of a kwh by the number uses should be easy, likewise multiplying the daily s/c  by the number of days is also a doddle.

Where people seem to fall down is understanding the difference between a standing order and a bill or the difference between typical, average, estimate and actual.

Denigrating 😳 not my intention at all. I can only speak as I find, my elderly relatives struggle my younger ones don't. 

ariarnia

busybee100 said:

[Deleted User] said:

busybee100 said:

Deleted_User said:

busybee100 said:

Lots of disingenuous arguments here.

It's periodically touted that petrol and diesel should include an amount to contribute towards the infrastructure ie. higher users should pay more. As it is because it comes from taxes we each pay a different amount based on our income. The parallel would be to pay a standing fee based on income but that isn't going to happen.

Someone's suggested a shopping comparison which is completely unrelated, apples and oranges.

Regardless of winners and losers it should be easier to compare. Either a flat rate for everyone or built in to the unit price.

If it's to be a standing charge it should be small enough it doesn't really impact the low user. 

Note. I only get a good deal at the expense of someone who can't or doesn't compare tariffs. One day I will be that person. So will you.

Why?

If it's to be a standing charge, surely it should be the actual cost - not some arbitrary small number that will affect some and not others.  All that does is to but yet another break-point.  How small would not "really impact the low user"?  I'm sure you could pick any number and some would say that it is unaffordable, or pointless, or just out for profit, or all the usual things.

The disingenuous arguments on this thread all appear to come from one point of view, which unsurprisingly you seem to be agreeing with.

Disingenuous on one side, as in you don't recognise the comparisons are not like for like?? 

There's not just an either or here, the problem is the standing charges are not the same for everyone. It needs addressing.

The arguments being given are to accept it in it's present form or completely absorb it into the unit price.

Alongside that is the argument to encourage lower use.

And more importantly enable people to compare prices and encourage them to use unit prices to work out their costs.

If you can tell my POV, go for it 🙄

The standing charges are not the same for everyone because the directly attributable costs are not the same for everyone.  Absorbing it into the unit price doesn't fix this, and just removes a point by which suppliers can compete.

Why is there always this repeated false argument saying that the way to encourage competition and switching would be to effectively ban suppliers from offering different types of tariff?  What's wrong with a supplier having a lower SC & higher UR tariff alongside their 'normal' one and then letting customers choose?

Having a lower unit rate encourages lower use.  You don't need to do anything to the standing charges to have that effect.

And disingenuous in the form of determining that an analogy is false and inappropriate because it is not precisely like-for-like (of course it isn't, it's an analogy) when used to disagree with their perspective. yet then using an almost identical analogy in the following paragraph to support their position. 

There you go again, you keep putting words in my mouth. I never said anything about encouraging competition. 

The benefit of having uncomplicated tariffs is to make it easier for the consumer. Many older people cannot understand their bills. The more complicated you make the system the more you ostracise them, the more they can be taken advantage of.

We are a consumer site. Should we not advocate for all consumers? 

I don't understand how "a lower unit rate encourages lower use" that just doesn't make sense.

we are a consumer site. doesn't that mean we should advocate for the best arrangement for all consumers not the lowest common denominator? making bills and tarrifs easier to understand and making sure there's help available to understand them if people want that help doesn't mean removing choice from the market so everyone has to be on the same (worse) deal. but a lot of people at least until recently werent interested not didn't understand.

there has always been a group of people who dont shop around for a new fixed morgage or home insurance or car insurance or phone contract and will just go with whatever the currently provider recommends. thats why the standard variable price cap was introduced in the first place. why should the people who are willing to spend 5 mins using a comparison site pay higher prices because some people can't be bothered?

wittynamegoeshere

[Deleted User] said:

wittynamegoeshere said:

It obscures the pricing, making price comparisons near impossible, so stifles competition and ultimately results in consumers paying more.

It does precisely the opposite!

The bill has two components.  Showing the price of both components really isn't "obscuring the pricing" - it's making it blatantly obvious.

I think you're probably intelligent enough to know that having two components to the price, where one is fixed and the other variable, and the amount of both can vary between suppliers is definitely more complicated than just having a unit price.

The fact that the vast majority don't have a clue how much they're actually paying is not an accident, they've been deliberately baffled into submission.  My OH's parents said the other day that their bill had gone up - because their DD's just gone up by £20/month.  Beyond this level they don't have the slightest clue, and only switched once when some nice lady showed up on their doorstep years ago and "helped" them.  They're definitely not alone in their level of understanding.

If the standing charge really is to cover the averaged out costs of network maintenance, debts of bankrupt suppliers etc then there's no reason for it to be variable anyway.  It could just be added to the end of every bill as a fee to the government or whoever, in the same way as the 5% VAT is.

400ixl

I see equally as many of the older generation as the younger both comprehending how the pricing works and not understanding it.

Usually the issue is that they believe the cap is the maximum they will pay, just as how they believed the fixed rate they had before was capped at the illustration they were given.

It is these simplifications which are put out there that cause the confusion not the fact there is a standing charge and a unit rate.

I have seen the comments about this is a consumer site so it should be simplified for the customer. As a consumer site, shouldn't we be advocating the charging should be fair and every one pays their own way equally. Given that there are fixed costs and variable costs, the current method is the fairest in my opinion.

What should be clearer is the way in which it is communicated.

Telling people they should take their annual usage and multiply that by the unit rate and add £x (annual standing charge) is not complicated for any age group.

So, people saying it should be a fixed rate, how is that fair to having people pay equally for their usage? Low users and those with second homes will be advantaged above just the fact they use less units making it an system which is not consumer friendly.

busybee100

ariarnia said:

busybee100 said:

Deleted_User said:

busybee100 said:

Deleted_User said:

busybee100 said:

Lots of disingenuous arguments here.

It's periodically touted that petrol and diesel should include an amount to contribute towards the infrastructure ie. higher users should pay more. As it is because it comes from taxes we each pay a different amount based on our income. The parallel would be to pay a standing fee based on income but that isn't going to happen.

Someone's suggested a shopping comparison which is completely unrelated, apples and oranges.

Regardless of winners and losers it should be easier to compare. Either a flat rate for everyone or built in to the unit price.

If it's to be a standing charge it should be small enough it doesn't really impact the low user. 

Note. I only get a good deal at the expense of someone who can't or doesn't compare tariffs. One day I will be that person. So will you.

Why?

If it's to be a standing charge, surely it should be the actual cost - not some arbitrary small number that will affect some and not others.  All that does is to but yet another break-point.  How small would not "really impact the low user"?  I'm sure you could pick any number and some would say that it is unaffordable, or pointless, or just out for profit, or all the usual things.

The disingenuous arguments on this thread all appear to come from one point of view, which unsurprisingly you seem to be agreeing with.

Disingenuous on one side, as in you don't recognise the comparisons are not like for like?? 

There's not just an either or here, the problem is the standing charges are not the same for everyone. It needs addressing.

The arguments being given are to accept it in it's present form or completely absorb it into the unit price.

Alongside that is the argument to encourage lower use.

And more importantly enable people to compare prices and encourage them to use unit prices to work out their costs.

If you can tell my POV, go for it 🙄

The standing charges are not the same for everyone because the directly attributable costs are not the same for everyone.  Absorbing it into the unit price doesn't fix this, and just removes a point by which suppliers can compete.

Why is there always this repeated false argument saying that the way to encourage competition and switching would be to effectively ban suppliers from offering different types of tariff?  What's wrong with a supplier having a lower SC & higher UR tariff alongside their 'normal' one and then letting customers choose?

Having a lower unit rate encourages lower use.  You don't need to do anything to the standing charges to have that effect.

And disingenuous in the form of determining that an analogy is false and inappropriate because it is not precisely like-for-like (of course it isn't, it's an analogy) when used to disagree with their perspective. yet then using an almost identical analogy in the following paragraph to support their position. 

There you go again, you keep putting words in my mouth. I never said anything about encouraging competition. 

The benefit of having uncomplicated tariffs is to make it easier for the consumer. Many older people cannot understand their bills. The more complicated you make the system the more you ostracise them, the more they can be taken advantage of.

We are a consumer site. Should we not advocate for all consumers? 

I don't understand how "a lower unit rate encourages lower use" that just doesn't make sense.

we are a consumer site. doesn't that mean we should advocate for the best arrangement for all consumers not the lowest common denominator? making bills and tarrifs easier to understand and making sure there's help available to understand them if people want that help doesn't mean removing choice from the market so everyone has to be on the same (worse) deal. but a lot of people at least until recently werent interested not didn't understand.

there has always been a group of people who dont shop around for a new fixed morgage or home insurance or car insurance or phone contract and will just go with whatever the currently provider recommends. thats why the standard variable price cap was introduced in the first place. why should the people who are willing to spend 5 mins using a comparison site pay higher prices because some people can't be bothered?

OMG "lowest common denominator"😱

Don't let matelodave see that 🤬

If you're advocating for all then by default you have to advocate for the "lowest common denominator"

Happy to help 😁

[Deleted User]

It has, for many decades, been the convention in the domestic energy sector that those that use energy pay for its distribution via their energy bills. The same is the case for such initiatives such as WHD; supplier failures; ECO grants etc. I cannot see any Government wanting to change a system that works.