News : Ofgem Protest on Energy Complaints
Sept 26, 2014 -- Ofgem has written to energy companies demanding they take action on poor handling of customer complaints.
The regulator's chief executive has sent letters to the "big six" and smaller and independent suppliers about the "industry-wide failure" to handle complaints to an acceptable standard.
It follows research by Ofgem that found more than half of those who had complained - 57% of domestic customers and 52% of small businesses - were not satisfied with how their supplier handled the problem.
Furthermore, in almost half of cases where the supplier considered the case resolved, the customer did not.
Ofgem said satisfaction with Npower and Scottish Power had fallen particularly markedly, from 36% to 21% and from 44% to 20% respectively, with only SSE managing to maintain levels of satisfaction found two years ago.
Earlier this year Ofgem opened an investigation into Npower's "prolonged customer service failings", the first under its new standards of conduct which state that suppliers must treat consumers fairly.
In today's letter, Ofgem warned companies to improve the speed of resolving complaints, communicate better with customers during the process and be more proactive in finding a solution.
The letter read: "The results are unacceptable. I am therefore drawing attention publicly to these findings to leave you in no doubt about the need to act quickly to improve matters.
"I expect you to provide a public response to the issues raised in this letter."
The regulator said many customers were now responding to suppliers' poor service by switching, with almost one in two customers having either already switched or planning to do so as a result of their complaints experience.
Ofgem chief executive Dermot Nolan said: "These satisfaction scores are frankly awful.
"Almost all energy suppliers need to improve their complaints handling as a matter of urgency. There are real business benefits to good complaints handling schemes, and it shouldn't need a regulator to tell companies about the importance of this.
"Suppliers must now tell their customers what steps they will be taking to put things right. We are already formally investigating Npower about complaints handling and other customer service issues, and this should send a strong signal to all suppliers that, where necessary, we will take action."
Posted by Veronica Silva Cusi, news correspondent
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Published: Friday, September 26, 2014