Energy retailers fail the hardship test

A new survey shows energy retailers are failing low-income customers.
 
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01.Financial counsellors rank the power companies

piggy-bank-and-a-power-cord

A report released this week reveals that energy retailers are failing low income and financially vulnerable consumers who are struggling to pay bills.

The Financial and Consumer Rights Council (FCRC), Victoria's peak body for financial counsellors, has published a 'Rank the Energy Retailer' report, based on a survey of over 100 financial counsellors in that state.

The results of the survey have seen the FCRC call on Victorian energy retailers and regulators to improve practices when dealing with customers experiencing financial hardship.

Overall, financial counsellors ranked Origin Energy as the current industry leader in handling customer financial hardship issues, followed by AGL then Energy Australia. 

As with the 'big three', second- and third-tier energy retailers ranked poorly across all measures, with a small margin between best and worst performers. 

Of the second-tier retailers, Lumo Energy achieved the highest overall rating and Australian Power & Gas the lowest. 

Cost-of-living pressure

With Australia now boasting some of the highest power prices in the developed world, "the problem of energy affordability is getting worse for low income and financially vulnerable households, and is beginning to affect customers higher on the income scale with energy costs rising faster than household disposable income", says executive director of the FCRC Peter Gartlan, in his foreword to the report. 

According to a survey conducted by CHOICE, The Brotherhood of St Laurence and the Energy Efficiency Council in 2013, electricity is the most concerning cost-of-living pressure for Australian households.

Gartlan says it's unsurprising that more people are participating in energy retailers' financial hardship programs than ever before. "Energy is an essential service that is necessary for social and economic participation. When vulnerable people cannot access appropriate services, the flow-on effects, such as energy disconnection, are significant," he says.

"Financial counsellors witness first-hand the failure of retailer hardship practices on a daily basis. What they are telling us is that poor internal processes and lack of staff training make it extremely difficult for customers and financial counsellors to access and communicate effectively with hardship teams."

 
 

 

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