British Gas fined £2.5m by Ofgem over customer complaints

Energy giant British Gas has been fined £2.5 million by the energy watchdog for failing to deal with complaints correctly.

British Gas, which serves nearly half of the UK's households, failed to re-open cases when customers indicated their complaint had not been resolved, Ofgem found.

The regulator also said the company failed to provide key information about the energy ombudsman to customers when complaints were not resolved and put in place a process to deal with businesses with 10 employees or fewer.

Ofgem said British Gas breached regulations setting standards for complaint handling which came into effect in October 2008.

Sarah Harrison, Ofgem's senior partner for sustainable development, said: "Today's finding highlights basic failures in British Gas's customer service, particularly in dealing with some of its small business customers, and shows Ofgem's commitment to use its powers to ensure suppliers treat customers fairly and transparently.

"We warned the industry in March that we would be backing up our plans to reform the retail market with a tough approach to enforcement."

British Gas said Ofgem's finding was "totally disproportionate" but did admit it failed on the issue of dealing with so-called micro businesses.

A British Gas spokesman said: "Specifically for our micro-business customers, we acknowledge our service fell short of what they should expect from British Gas, for which we apologise.

"We knew we had an issue here which is why we flagged it to Ofgem. After a £4 million investment, we are now confident we meet all of our regulatory requirements."

Ofgem has vowed to get tough with energy firms as part of a proposed shake-up of the industry.

The regulator's reforms include reducing the number of tariffs suppliers offer to avoid confusion over price and improving transparency by appointing an independent accounting firm to ensure the suppliers' books are clear.

Ofgem is investigating Npower and EDF Energy for complaint handling, while Scottish Power, Scottish and Southern Energy, EDF Energy and Npower are being investigated for mis-selling.

The watchdog is also running two investigations into Scottish Power for potentially misleading marketing and the difference between its standard credit and direct debit tariffs.

British Gas, which is owned by energy giant Centrica, earlier this month announced price hikes of up to 24%.

Nine million customers will be hit when the supplier raises gas and electricity prices by an average of 18% and 16% respectively from August 18.







Audrey Gallacher, director of energy at Consumer Focus, welcomed Ofgem's action against British Gas.



She said: "Frustrating the attempts of customers to get complaints sorted out is unacceptable. It adds to the lack of trust in energy companies and it denies British Gas important insight into customer service problems.



"The importance a company gives to solving customer complaints is a good indication of how much they value their customers.



"British Gas deserve some credit for being open about its failures and taking action to put them right. But the experience of its customers when they make a complaint in the future will be the real test."









Shadow energy secretary Meg Hillier said the fine would deliver "a further knock to public trust" in the UK's "big six" energy providers, who together supply 99% of customers.



Ms Hillier said: "So-called customer choice in the energy market is limited to whether to switch between a confusing array of energy tariffs set by companies, who are all increasing their prices unfairly and disproportionately.



"David Cameron promised he would take action to prevent excessive price rises - he is breaking that promise.



"We need greater competition in the market. That is why Labour is calling on the Government to force the energy companies to pool the power they generate and make it available to any retailer. This would help drive down prices."



PA

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Tradewind Recruitment: KS2 Teacher

Negotiable: Tradewind Recruitment: My client is a two form entry primary schoo...

Tradewind Recruitment: English Teacher

Negotiable: Tradewind Recruitment: My client is an excellent, large partially ...

Tradewind Recruitment: Science Teacher

£90 - £140 per day: Tradewind Recruitment: I am currently working in partnersh...

Tradewind Recruitment: Year 3 Primary Teacher

£100 - £150 per day: Tradewind Recruitment: Year 3 Teacher Birmingham Jan 2015...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee