British Gas makes payments totalling £1.73 million for handling of changes to prepayment meter top-up arrangements
British Gas failed to notify around 270,000 prepayment customers about a change of top-up provider, from Paypoint to Payzone, which went live on 1 January 2020.
This meant that some customers, many of whom are in a vulnerable situation, may have suffered detriment through wasted journeys to try and top-up at shops which no longer offered the service, or in some cases may have gone off supply. British Gas ultimately sent communications to these customers in late January 2020.
British Gas informed most of its customers of the change in top-up provider in December 2019. The communication contained details not only of the change of top-up provider but also of the change in minimum top-up from £1 to £5.
This left insufficient time for customers to switch supplier if they found the new arrangements to be problematic.
The notification did not include telephone contact details, but instead contained links to the internet. Those customers unfamiliar with, or without access to, the internet may have struggled to contact British Gas in the event that they were struggling to top-up.
Additionally, British Gas chose not to operate its general enquiries line on 1 January 2020 – the go-live date.
When British Gas decided to switch to Payzone, it failed to make sure that communication with its customers was adequate both in terms of coverage and content.
Ofgem engaged with British Gas in early January 2020 when it became aware of problems with the switchover of top-up provider.
Ofgem asked for information relating to the case and as part of that request, British Gas told us that it proposed to make compensation payments of £1.48 million to impacted customers.
British Gas has also agreed to pay £250,000 to Ofgem’s voluntary redress fund administered by the Energy Savings Trust, which supports consumers in vulnerable situations and the development of innovative products or services not currently available to energy consumers.
Due to the steps British Gas has taken, Ofgem has decided not to take formal enforcement action.
Philippa Pickford, Director of Retail at Ofgem said:
“When such a fundamental change is being made, such as where meters can be topped up, energy suppliers need to communicate with their customers in plenty of time. British Gas should have informed all of their prepayment customers, many whom are in vulnerable situations, of the change to how to top-up their meters during the winter period.
“Some customers were unaware of the change before it happened and may have struggled to contact British Gas as they opted not to open their general enquiries line on the go live date. Others were given insufficient time to make alternative arrangements if they were unhappy with the change of top-up provider.
“Ofgem will continue to closely monitor the market to ensure that all customers are protected and treated fairly by their supplier.”
Notes to editors
- Ofgem closes compliance case with British Gas, regarding its handling of changes to prepayment meter customer top-up arrangements.
- For more information about Ofgem’s voluntary redress fund, see: Ofgem appoints Energy Saving Trust to distribute payments from rule-breaking energy companies to charities.
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