SSE fined £1m for inaccurate statements
● Firm rapped for giving misleading details to pre-payment meter customers
Big Six energy giant SSE has been ordered to pay £1 million for sending out inaccurate and misleading annual statements to 580,000 pre-payment meter customers.
Industry regulator Ofgem said an investigation found that SSE sent out a total of 1.15 million statements that were inaccurate and misleading between June 2014 and September 2015.
The energy watchdog said that due to an IT coding error, these annual statements had incorrect information on the alternative cheaper tariff which was available to customers and inaccurate estimates of how much they could save annually by switching to them.
Some statements also overestimated the annual savings the customers 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.
Ofgem, which launched the investigation last November after SSE reported the issue, added that the company failed to act quickly to address the errors.
Ofgem 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.”
However, the watchdog said that the impact on customers was minimal, as only a small proportion of households would have acted on the information given in the statements by switching, and 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 since to address the failings, the low level of harm caused to customers and the £1 million agreed payment.
Ofgem also confirmed that SSE has since improved its processes to prevent incorrect statements being issued again, including extra checks on customer communications.
SSE will pay the £1m penalty into Ofgem’s consumer redress fund administered by the Energy Saving Trust, which helps consumers who are in vulnerable situations and supports the development of innovative products or services.
SSE’S director of customer service operations, Gareth Wood, said: “We deeply regret the historic problems we identified with some annual statements for pre-payment customers, relating to a coding issue between 2014 and 2015.
“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.
“Although we’re disappointed not to have met the high standards expected of us in this instance, we’re pleased that the matter has now been closed with a voluntary payment that will directly benefit vulnerable customers.”