Source · Select Committees · Business and Trade Committee
Recommendation 26
26
Accepted
Paragraph: 117
Our first priority is to ensure that customer credit balances are protected, so that in...
Conclusion
Our first priority is to ensure that customer credit balances are protected, so that in the event of a supplier failure, customers are always able to recover the credit 78 Energy pricing and the future of the energy market they have built up. Our second priority is to ensure that any policies put in place to secure this also prevent an increase in energy bills. We agree that some energy suppliers have taken high risk decisions on the basis that they were spending their customers money and not their own. Any new regulation on the holding of customer credit balances must carefully balance these two priorities whilst not distorting competition between retailers.
Government Response Summary
Ofgem has announced four Market Compliance Reviews to drive improvement across the market.
Paragraph Reference:
117
Government Response
Accepted
HM Government
Accepted
Ofgem has announced four Market Compliance Reviews to drive improvement across the market. The second Market Compliance Review, published on 27 September, focused on how suppliers support customers in debt or payment difficulty, along with suppliers’ compliance with the Ability to Pay licence obligations. The review found that although good practice exists across the industry, most suppliers need to make improvements in processes and governance to meet their obligations. The majority of suppliers were found to have minor or moderate issues and three were found to have ‘severe’ weaknesses – of which two suppliers have been served with immediate enforcement notices. Given the depth of these concerns, Ofgem issued Provisional Orders to Utilita and ScottishPower requiring specific urgent actions and is considering whether enforcement action is warranted for other suppliers. 28 Responses to the Committee’s Third Report of Session 2022–23 best practice information. The next market review will look at customer vulnerability and will be published later this year.