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The Acting Ombudsman's view

James Lawson smaller version

"Transfer cases rose 42% in the April to June 2022 quarter, when compared to the previous quarter."

Cases have been increasing month on month since a low in April, with June 2022 numbers 50% higher than April. However, overall case numbers for the April to June 2022 quarter were lower when compared with April to June 2021, a decrease of 22%.

One case issue type that is partly responsible for the increase in cases is Billing > Tariff. Complaints of this type rose from 56 in May 2022 to 110 in June 2022. This is partly due to the communications sent out by some energy companies in the quarter, advising customers of impending price increases and suggesting customers transfer away from them. This issue has also led to an increase in Transfer complaints, which rose 42% in the quarter.

Complaints from family violence victim-survivors show that energy and water companies need to do better in terms of customer service and account security. We will continue to highlight these issues and work to ensure improvements are made quickly.

We explore both of the above in the Issues Watch section of this report.

We continue to advocate for the inclusion of external dispute resolution processes when new and emerging energy products are launched in Victoria. We see our complaint mechanisms, and the data that we collect and share, as a positive influence on good innovation in the market. Read our Public Submission section for more on this.

Read on for more detail in the latest edition of Reflect. As always, you can find more data relating to our casework in the Data Hub.

See more in our Data Hub

Issues watch

Family violence systemic issues being investigated

We continue to receive complaints from family violence victim-survivors that point to potentially concerning actions at energy and water companies. Some of these complaints are now being investigated as possible systemic issues that could have the potential to affect many other victim-survivors if not addressed.

In one of the cases being investigated as a potential systemic issue, it was reported to us that a retailer’s employee advised a financial counsellor that the company did not have a family violence policy, which was incorrect. In another case, a water company sent an invoice to the perpetrator’s property which listed the victim-survivor’s current address.

Energy and water companies have slightly different requirements under regulations, however, in general they must have a family violence policy and meet minimum standards on aspects like training, account security and customer service. We continue to pay close attention to the family violence-related issues customers present with in our cases, and we are working with companies, regulators and policy makers to draw their attention to these matters.

Transfer cases rising with wholesale price pressures

Transfer cases rose 42% in the April to June 2022 quarter, when compared to the previous quarter, increasing from 211 to 299 cases. In addition to the more common issues we see around transfers, such as transfers in error and transfers resulting from a ‘letter to the occupier’, we have seen cases from customers related to the price increases in the market and the communications sent out from some smaller retailers, suggesting customers could benefit from transferring away from their business.

In one case received by EWOV, a customer complained to us about a failed gas transfer. They said they were in the process of transferring to a retailer but it refused to take them as a customer after the final meter read, saying it was due to increasing gas prices. This was one of the retailers that had contacted its existing customers about impending price increases. Another customer had a similar experience at a different retailer. After they tried to transfer to the retailer, they said they were told that it was withdrawing deals available on the Victorian Energy Compare website and would not be taking new customers.

We have also seen complaints about delays in transfer related to price increases. In one complaint, a customer told us that they has applied to transfer their gas account to another provider after their retailer had advised them that it was increasing the rates. However, the customer told us the transfer occurred 44 days after their application and they were dissatisfied, as they were paying the higher rates for a longer than expected period.

With many transfers taking place due to price increases, there may be more complaints in the future regarding these issues, particularly when the volume of transfers leads to delays. This may be particularly relevant for gas retailers, since meters have to be manually read and an increase in the need for meter reading is likely to coincide with staff absences due to COVID-19.

Billing tariff cases spike

Billing > Tariff cases rose sharply at the end of the April to June quarter, increasing from 56 cases in May to 110 cases in June. The increase coincided with the communications sent by some retailers, advising customers that double or triple-digit percentage rate rises will be coming and, in many cases, suggesting customers find another retailer.

We received complaints about one retailer, for example, related to the price increase notifications. Several customers told us that they received a price change notice telling them of a dramatic increase in their tariffs. These customers told us that the increases made the plans higher than the rates of the current Victorian Default Offer (VDO). One customer told us that they requested to be put on the VDO but that the retailer had not responded to their communication. Another customer told us that they had asked to move to the VDO and was advised by the company that it was not an option.

In most cases, customers in Victoria are entitled to receive the VDO from their retailer if they are unable or unwilling to engage in the market. It is important for energy companies to honour the VDO if a customer is entitled and makes this request. We will be watching these cases closely to determine if any of the complaints are systemic in nature.

The big picture

  • From April to June 2022, we received 3,474 cases, down 7% from the previous quarter and down 22% from the same quarter in 2021.
  • June 2022 case numbers were 50% higher than those in April 2022
  • Billing cases dropped 9% compared to the previous quarter and were down 17% compared to the April to June 2021 quarter.
  • We received 326 high billing cases from April to June 2022, down from 357 high bill cases from the same time last year.
  • Credit cases dropped 22% in the quarter, compared to the previous quarter. Credit cases were down 31% when compared to the same quarter last year.
  • Disconnection cases decreased by 28% compared to the previous quarter (from 223 cases to 161 cases).
  • Payment difficulties cases also decreased (down 21%) and so did Credit Collection cases (down 19%) when compared to the previous quarter.

Disclaimer

  • Reflect and Data Hub data is a ‘live’ view of case data up to the end of the previous period.
  • Cases can sometimes be amended, reopened and reallocated — adjustments made to cases in previous quarters will be shown in the previous quarter's figures within the visualisations.
  • For these reasons, there may be discrepancies between previous quarter data presented in the visualisations and the information presented in past editions of Reflect.

Customer stories

Billing

Safety switch callout leads to additional charge

BILLING | HIGH BILL

Case number: EWOV/2022/00007183

Bruna* filled out our online complaint form, telling us they were dissatisfied with their electricity distributor because of a higher than expected charge. There was an electrical fault at Bruna’s property that caused the safety switch to switch off. Bruna told us they called the distributor about coming to check the switch and their technician attended the property and reset the safety switch, which took around three minutes to complete. On the next bill from their retailer, Bruna noticed an extra charge of $1,093.27 and told us they were not advised there would be a charge and believed it should be free, as only the distributor can access the switchboard.

We raised an Assisted Referral to a higher-level representative at Bruna’s distributor. Bruna returned to us, saying their distributor told them it communicated the price to them and it remained payable. It provided a transcript of the call, showing that it mentioned a fee of $900. Bruna believed it did not mention this in the call.

We started a Stage 1 Investigation into Bruna’s complaint to try to get an efficient resolution to their case. Bruna’s distributor confirmed that the fee was quoted to Bruna’s partner over the phone on 9 March 2021. During the call, the distributor advised that the fee would be approximately $992. It acknowledged that it quoted the price without confirming if that fee included or excluded GST. We listened to the call and confirmed that the distributor did mention the fee of approximately $992, without disclosing GST, and that the fee was accepted by Bruna’s partner.

In recognition of the error in not disclosing GST and for the inconvenience, the distributor offered to provide a customer service gesture payment of $200. The fee of $1,093.27 remained payable. Bruna told us they were satisfied with this outcome and we closed the case.

* Name has been changed


Credit

Customer with mental health condition and large arrears

PAYMENT DIFFICULTIES | DISCONNECTION

Case number: EWOV/2022/6189 and EWOV/2022/6190

Rachel* contacted us on our 1800 number with a complaint about their electricity and gas retailer. Rachel told us they have a mental health condition and is receiving shock therapy. They said they have arrears of around $6,000 for electricity and $9,000 for gas. The retailer called Rachel on 6 April 2022, just after one of the treatment sessions, to discuss a new payment plan and Rachel said it insisted they pay $300 per week, which they can’t afford. They were worried a direct debit of $300 would fail because there are insufficient funds in their account. Rachel also said that the retailer disconnected their electricity a couple of weeks prior and that it would reconnect if they paid $100, which Rachel did. Rachel wanted the retailer to stop the $300 direct debit and allow them to pay a more affordable amount of $60 per week, per service.

Our case registration procedure allows us to move straight to an Investigation if there are special circumstances. We bypassed the usual Assisted Referral stage and went straight to an Investigation because of Rachel’s mental health and payment difficulty issues.

During our Investigation, Rachel’s retailer confirmed the amount owing on electricity was $5,391.96 and $9,816.83 on gas. The retailer admitted that, due to its error, concessions were not applied to Rachel’s account. Missing concessions amounted to $1,549.02 for electricity and $1,592.69 for gas. It agreed to apply double the missing concession amounts to the electricity and gas accounts in recognition of the inconvenience caused. It also agreed to apply the concessions going forward. With the concessions and credits applied, the total amount owing on electricity would be $2,293.92 and $6,631.45 for gas. It confirmed that Rachel had the Utility Relief Gas Scheme applied in April 2021, meaning they would not be eligible again until 2023. It also confirmed that Rachel was on the best value plan available to them.

The retailer confirmed that it tried to stop the $300 direct debit on 8 April 2022 but was unable to stop it. It agreed to refund the $300 payment and apply a $200 goodwill gesture to cover any overdraft fees. It agreed to contact Rachel to establish an affordable gas and electricity payment plan and help Rachel reduce their gas and electricity consumption. Rachel told us they were satisfied with the outcome and we closed the case.

* Name has been changed

Transfer

Rates higher than welcome pack

DEBT COLLECTION | BILL DISPUTE (SMALL BUSINESS)

Case number: EWOV/2022/00006502

Maria* contacted us on behalf of a small business, unhappy about a contract variation with their retailer. Maria told us that, every year, their business is approached by a broker to let them know about cheaper electricity and gas deals. The broker offered a deal on electricity and gas with the retailer but Maria later discovered that the retailer does not take on gas accounts. Maria told us that they received the first electricity bill from the retailer but the rates differed from the rates in the welcome pack. They said they contacted the retailer and it told Maria they had to accept the rates on the bill. Maria was not happy and transferred away from the retailer but wanted the charges with the retailer amended to those on the welcome pack.

We raised an Assisted Referral to a high-level contact at the retailer but Maria returned to us and said they had not been contacted but only received an SMS message reminding them to pay the overdue bill. Maria said the outstanding bill was $890 but that they think $290 of that is in dispute, as the bill should have been around $90 cheaper with the welcome pack rates and the broker has promised a $200 credit upon signing.

When Maria’s complaint couldn’t be resolved at the Assisted Referral stage, we started an Investigation. We asked Maria’s retailer to suspend any debt collection, not to disconnect supply and to not contact Maria directly about the matter while we investigated. During our investigation, however, Maria contacted us to let us know that they had received a debt collection notice after we had requested the retailer to suspend all debt collection activity. Due to this action, we upgraded the complaint to a Stage 3 Investigation.

The retailer apologised for the inconvenience and poor customer service. It offered to credit Maria’s account $95.32 in recognition. It acknowledged that its agent misinformed Maria about the $200 signing bonus and offered to credit the account a further $200. It also confirmed that the rates applied to Maria’s first bill were higher than the welcome pack rates, however, the second bill had the correct rates. It calculated that Maria had been overcharged $118. It offered to credit Maria a further $120. The closing balance of Maria’s account was $1,015.32 and, after the credits, would be reduced to $600. It offered a six-month payment plan of $100 per month in order to complete the $600 account. Maria agreed to the resolution and we closed the Investigation.

* Name has been changed

Family violence

Victim survivor gets assistance with arrears and leaks

FAMILY VIOLENCE | PAYMENT DIFFICULTIES

Case number: EWOV/2022/00004014

Imogen* called us with a payment difficulties issue. They identified as vulnerable, with four dependent children and caring for a father with cancer, along with being a victim-survivor of family violence. They had a complaint about their water company due to higher bills. Imogen told us that, due to ongoing issues with their landlord, they have leaking taps in their rental property that have not been repaired. They are paying $15 per fortnight on arrears of $900. They stated that it was beyond their means to move to a better house. The water company had offered a payment plan and has applied for the Utility Relief Grant Scheme but Imogen wanted it to reduce the current arrears in light of their circumstances.

We elected to bypass the usual Assisted Referral stage and go straight to Investigation, given Imogen’s circumstances. We asked the water company to suspend any debt collection and not to restrict supply while we investigated the complaint.

Imogen’s water company offered to waive Imogen’s debt of $947.50 and to match their payments of $15 per month to prevent any arrears accumulating. It also offered to cover the cost of sending out a plumber to fix any small leaks, to help with their water usage. Imogen told us they were satisfied with the offer and the outcome of their complaint, and we closed the case.

* Name has been changed

Outreach

Our focus on community outreach and engagement supports our goal of increasing accessibility and awareness of EWOV while building relationships with organisations that work with Victorian energy and water consumers who may be at the greatest risk of experiencing financial vulnerability.

We have been participating in as many outreach events in the community as possible, within the demands of the pandemic. We joined the Australian Red Cross, Good Shepherd, Uniting and the Asylum Seeker Resource Centre to share information with the Persian community about our complaint process, as well as provider and customer responsibilities regarding energy disputes. We also attended events in Wyndham, Hume and at Djirra (the Aboriginal-controlled provider of support for Victorian Aboriginal Women).

We made a connection with Ask Izzy, a website that links people in need of support services such as housing and financial assistance. The Ask Izzy team spoke to our staff in May about the services they provide. We also spoke to the Victorian Small Business Commission, which provides low-cost dispute resolution services for small businesses, Council on the Ageing (COTA), the leading not-for-profit organisation representing the interests and rights of people aged 50+ in Victoria, and Federation of Community Legal Services. We talked about emerging trends they are seeing in the small business, ageing and vulnerable populations, and discussed ways to partner on future outreach events in the community.

We continued our discussions with representatives of Consumer Action Law Centre, Financial Counsellors Victoria and the Essential Services Commission around best practice when working with Financial Counsellors acting on behalf of vulnerable customers. Finally, in late June, Abound Communities invited us to visit the citizens of Rushall Park and speak to the independently living residents about ways they can reduce their energy consumption and how EWOV can provide free, fast and effective assistance should they need it.

Scheme participants

In our Data Hub, you'll find the latest quarterly case data for all of EWOV's scheme participants.

Systemic issues

From April to June 2022, we closed three energy systemic issues and one water systemic issue identified through our case handling.

Final disconnection notice and clear information

Our case handling uncovered an issue with the final disconnection notice issued by a retailer. The notice included the retailer’s full payment assistance and hardship policy, which may not have complied with the code, which requires clear and unambiguous information, given the length and volume of the notice. The retailer agreed to update its final disconnection notice and, while the review is underway, to not disconnect. We were satisfied with the retailer’s commitments. EWOV/2022/6589

Best offer missing

We discovered that a retailer was not compliant with the requirement to include a deemed best offer message on a bill or bill summary from May 2021 to May 2022, affecting approximately 9,000 customers. The retailer told us that it was caused by a billing configuration issue with its third party provider. The issue was fixed on 6 May 2022. We were satisfied with the steps taken to rectify the issue and referred the matter as a potential compliance breach. EWOV/2022/6377

Overcharging of large market customers

A water corporation self-reported a billing issue which resulted in the overcharging of approximately 635 large market customers, caused by a fleet of meters installed with incorrect settings. The corporation refunded all customers including interest. The corporation also contacted customers and included EWOV’s information. We were satisfied with the action taken by the water corporation and we have not received any complaints to date. EWOV/2022/6236

Public submissions

Draft decision – Implementing a regulatory sandbox framework for the energy sector

Essential Services Commission (ESC)

We provided a submission in response to the ESC’s draft decision about a regulatory sandboxing arrangement for eligible businesses to trial an innovative product or service in Victoria with a temporary waiver from existing rules for a time-limited period. We considered it important that amendments be made to include mandatory reporting and inclusion of becoming a member of EWOV as a positive obligation for the trial waiver holders to enable their customers to access our services.

Read the submission

Retail authorisation and exemption review

Australian Energy Regulator (AER)

We made a submission to the AER’s issue paper which is looking at reviewing retail authorisation and exemption in the climate of emerging distributed energy resources. We were supportive of the development of the Retail Authority and Exemption framework. We considered that the framework’s approach should focus more explicitly on prioritising customer experiences and outcomes, and ensuring the approach considers an inclusive future for consumers, including baseline protections such as access to free and independent Ombudsman services, such as EWOV.

Read the submission

Glossary

Visit the Data Hub for a full glossary of terms.