Ofgem consultation on framework for consumer standards and policy options to address priority customer service issues
We welcome any action to drive improvement in service delivery and support for people in vulnerable circumstances.
We consider many of the people who are struggling to pay their energy bills, will also be struggling to pay their water bills so we welcome the opportunity to respond to Ofgem’s consultation on framework for consumer standards and policy options to address priority customer service issues.
Our responses to the specific consultation questions
We consider that in addition to what you propose, it is not just the ability to identify a method of contact to meet their needs, but also the method should be easy to access and use. We’d recommend that this is included in “what good looks like”.
Whilst it is encouraging that ease of contact is being addressed, a focus on query resolution of the contact appears to be an omission. For many people they are making contact because they want an issue resolved and therefore effective and timely query resolution should be included in “what good looks like” and in the data collected.
In 2021, CCW undertook an independent review of water affordability for UK and Welsh Ministers. Although we found that the financial help already available was good, we also identified a number of areas where support – and the awareness of it – could be improved. These included:
- More tailored support to those facing financial difficulties and those already in arrears
- Clear and accessible customer communications
- More work to understand the needs of communities
- A proactive approach to identifying customers who need support, including the use of data sharing
Since the publication of the report, we’ve been working with companies and other stakeholders to ensure the recommendations are put into practice. When we published the Affordability Review: One year on report last year, we were able to highlight significant progress in improving support for customers.
Progress has included:
- Water companies have agreed to use common descriptors to describe the support options they offer, helping advisors navigate the help available across the sector
- All water companies have agreed to sign up to either the British Standards Institute (BSI) or the new International Organisation for standardisation (ISO) standard on inclusive services
- All companies are now sharing details of financial support options with customers who sign up to their priority service registers, recognising that there are significant overlaps between customers facing financial and non-financial vulnerabilities
In addition, we also consider that there should be a consistent suite of debt support available across all energy retailers. This would make it easier for people and their representatives to seek appropriate support.
Finally, we would be interested to hear if there is also an issue that may need addressing with awareness of support available from energy companies. Our water matters research shows that over one third (37%) of people surveyed are aware that their water company offers reduced bills to some households, who sometimes struggle to pay their bills because of their financial circumstances.
With low awareness leading to people not self-identifying that they may qualify for support, all utilities should have processes in place to identify who needs the support and to make it easy for customers to access and use the support.
Whilst the ideas are noble, to determine if these would deliver the best outcome at the best value we would need to see additional information provided on the current level of contact attempted outside of current hours, a feasibility of implementation assessment and the cost impact to customer bills for providing cover for extended hours or 24/7.
We do agree that there should be a minimum consistent service expectation which allows for companies to deliver an enhanced self-funded service should they choose to.
We believe that companies should not make a profit out of providing support to people in vulnerable circumstances. Therefore, we don’t consider that there should be a financial incentive to performance in this area. Instead, a reputational incentive should be in place, such as what is currently in place in the Water Sector for common vulnerability performance commitments (pdf).
See response to Q2.
As previously mentioned, data on “satisfaction with the way the query was handled” should be included.
Debt – Under the Social Obligations Reporting, it would appear that numbers of customers in arrears who are not yet on a debt repayment arrangement is currently collected. It would be helpful to include this in monitoring data as it shows the potential pool of customers who may need advice and support with their bills.
 Q4 2022 Social Obligations Reporting (SOR) analysis showed that there were around 3.4m domestic accounts in debt or arrears for over 91 days (6.5% of all accounts).
We support a principle based approach to drive improved outcomes with a caveat that should the desired improvement not be seen using this approach and using reputational incentives then action will be taken by Ofgem to consider if a rules based approach is needed. Ofgem will be aware of Ofwat’s consultation on its new Customer Licence Condition.
As per question 4.