Energy customers to win compensation
The regulator Ofgem is to be given new powers to force energy companies to compensate customers who have been mis-sold services or overcharged.
The Energy Secretary, Ed Davey, said the changes, which are put out to public consultation today, will strengthen Ofgem's ability to protect consumers and bring it into line with the powers held by other regulators.
The proposals come amid The Independent's Fair Energy campaign, which is fighting fuel poverty by calling for a windfall tax to force energy companies to help their most needy customers. It is hoped the changes would end the present system in which Ofgem can fine companies, with the money going to the Government, but has no authority to order compensation to be paid to consumers. Any payments that are made to consumers are voluntary.
Mr Davey said yesterday: "I want to make sure that consumers are protected and that the independent energy regulator has the powers it needs.
"We are now looking at beefing up Ofgem's powers so that it can make companies compensate consumers directly, rather than necessarily having to rely on a voluntary approach."
The proposals were, however, described as "tinkering around the edges" by Ed Matthew, director of the campaign group Transform UK, which is calling for radical reform of energy bills. "This is a small step forward to protect exploited energy consumers," he said. "But if the Government is serious about bringing down energy bills, they must use carbon tax revenue to make all homes super energy-efficient. This is the only permanent solution to end the blight of fuel poverty." He said that from next year carbon taxes will raise £2bn, rising to £4bn by 2020, enough to make 600,000 homes energy efficient each year.
Ofgem welcomed the proposed new powers. Sarah Harrison, in charge of enforcement, said: "These powers, which we have been seeking from government, would strengthen our ability to take more targeted action against companies that are found in breach of their licence."
Audrey Gallacher, the director of energy at Consumer Focus, said: "This is a really welcome move from the Government. Money should be going back into consumers' pockets when they have lost out – not into the Treasury's coffers as is the case with fines now."
The executive director of Which?, Richard Lloyd, said: "It's only fair that consumers are properly compensated when they have lost out due to energy companies overcharging or mis-selling."
- 1 Snoop Dogg and Jared Leto buy a stake in Reddit as A-list invests $50m
- 2 Prince held a Facebook Q&A and this is the only question he answered
- 3 'F*ck it, I quit': KTVA reporter Charlo Greene quits live on air in spectacular fashion
- 4 35,000 walrus gather ashore on north-west Alaska beach 'for a rest'
- 5 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
Snoop Dogg and Jared Leto buy a stake in Reddit as A-list invests $50m
Prince held a Facebook Q&A and this is the only question he answered
Brad Pitt, on the moment he completely lost his temper with Clint Eastwood's son
Cheryl Cole officially the 'most dangerous celebrity' on the internet
Ebola virus in the US: What are the symptoms, what is it and is there a cure?
Exclusive: 'Putin's Russia has been my biggest regret,' says Nato's outgoing Secretary General
The Osborne Ultimatum: Chancellor’s benefits freeze bombshell will affect ten million households
There’s no excuse for Dave Lee Travis’s behaviour, but we need to keep a sense of proportion
Should gay sex be illegal? 16% of Britons think so
Mark Reckless becomes second Tory MP to defect to Ukip in a month
Benefits 'smart cards' plan revealed by Iain Duncan Smith to stop claimants spending welfare money on alcohol
- < Previous
- Next >
£18000 - £23000 per annum + Uncapped OTE: SThree: SThree Group have been well ...
£18000 - £23000 per annum + OTE: SThree: Real Staffing Group is seeking Traine...
£120 - £140 per day: Randstad Education Leeds: We have an exciting opportunity...
Competitive: Randstad Education Manchester: SEN Teacher urgently required for ...