SSE fined £1m for misleading customers
BIG Six energy giant SSE has been ordered to pay £1million for sending out inaccurate and misleading annual statements to 580,000 pre-payment meter customers.
Regulator Ofgem said an investigation found that Perth-based SSE sent 1.15million error-strewn statements between June 2014 and September 2015.
The watchdog added that because of an IT coding error, these annual statements had incorrect information on the alternative cheaper tariff available to customers and inaccurate estimates of how much they could save annually by switching. Some statements also overestimated the savings that people could make by changing their pre-payment meter to a standard credit meter paying by direct debit, as well as by moving to paperless billing.
The sanction comes as SSE became the last of the Big Six energy companies to hike prices for gas and electricity – by an average of 6.7 per cent.
Ofgem, which launched the probe last November after SSE reported the issue, said: ‘The investigation found that SSE failed to act promptly to put things right, by not identifying the issue at an early stage and by not escalating action to address it or putting in place appropriate remedial actions.
‘The supplier also failed to put in place arrangements and processes around customer communications that were complete, thorough and fit for purpose.’
But Ofgem said that the impact on customers was minimal, as only a small proportion of households would have acted on the information by switching, while the average saving for each of these customers would also have been low.
It said it had decided not to take formal enforcement action, in view of SSE’s steps taken to address the failings and the £1million agreed payment. Ofgem confirmed that SSE has since improved its processes to prevent incorrect statements being issued, including extra checks on customer communications.
SSE will pay the £1million penalty into Ofgem’s consumer redress fund administered by the Energy Saving Trust, which supports vulnerable consumers.
Gareth Wood, SSE’s director of customer service operations, said: ‘We proactively reported this to Ofgem once we became aware and, as Ofgem has recognised, we’ve put things right and now have stronger measures in place to help ensure it doesn’t happen again.’