Price comparison sites accused of hiding best energy deals from customers

The Big Deal has accused five major switching websites of filtering out energy tariffs that don’t pay commission

Simon Read
Monday 20 October 2014 17:59 BST
GoCompare's ads are as successful as they are irritating
GoCompare's ads are as successful as they are irritating

Comparison sites have been accused of misleading consumers by not showing them the best deals.

The warning comes from a collective bargaining website, which claims the big five switching firms filter out energy tariffs that don’t pay commission.

But it echoes complaints that The Independent has received from independent energy firms which say if they don’t pay high enough commission to comparison sites, they don’t get a look in.

One – which prefers to remain anonymous for fear of jeopardising its relationship with the hugely-profitable comparison sites - told us: “Comparison sites have the option “Show plans we can switch you to today” and the default is always yes. However, if you click yes you are not actually shown all the cheapest deals.”

According to our source, this is often because the tariff is with a supplier that does not have a commercial contract with the switching site. But it might also be because there are agreements where the supplier has requested that certain deals are not available as an online switch.

That means they won’t show on the “switch today” option, even though they might offer much lower charges.

Now the Big Deal website has accused five major price comparison websites of using the practice. It says it has complained to those concerned - Compare the Market, GoCompare, uSwitch, MoneySuperMarket and Confused.

It said it has also forwarded its letter to Energy Secretary Ed Davey and said it wants the Competition and Markets Authority to expand its investigation of the energy market to include the activities of price comparison websites.

The Big Deal said: "The price comparison sites are worth hundreds of millions of pounds, make huge profits and, with over five million people switching a year, are a major part of the energy market. Yet there is no transparency to how they make their money or how much they charge."

The comparison sites denied hiding the best deals and said their websites are transparent, and conform to the regulator's code of practice.

Dan Plant, editor in chief at MoneySuperMarket, said: "The option for customers to filter results is displayed clearly and prominently, and is necessary as some providers choose not to list products on comparison websites."

Confused said customers could see every available tariff on its website, and it was committed to transparency. "Some suppliers do not make certain tariffs available through comparison sites, so we give customers the option to exclude these from the results," explained Kate Rose, head of energy at Confused.

Angela Knight, chief executive of Energy UK – which represents the energy suppliers - said: “Comparison sites should not benefit from limiting options to customers.

“Not disclosing commission and not advertising the full array of deals on offer undermines the industry’s work to be more up front with customers. The energy industry is committed to transparency and we expect others in the energy supply chain to do the same.”

The energy regulator, Ofgem is planning to update its code of practice to give better protection to consumers. It plans to bring in the new code early next year.

But it’s not just energy comparison sites that are coming under regulatory scrutiny. In July the City Watchdog warned that insurance price comparison websites were failing consumers.

It accused the sites of “failing to meet consumers’ expectations of them and, in some cases, the FCA’s regulatory standards”.

It said the websites did not always ensure that consumers were given the information they need to help them make informed decisions.

Clive Adamson, FCA director of supervision, said: “Our research found that price comparison websites are not meeting our requirements in delivering fair and consistent outcomes for consumers. We also found that consumers had a number of misconceptions about the services they provided.”

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