A vulnerable customer with ongoing payment difficulties was told to pay $3,000 to have her family’s electricity supply reconnected
The Issue
Ms J, a single parent of three children, had been having difficulty paying her electricity bills for a few years. In March 2017, her electricity was disconnected for non-payment of about $5,000. The retailer told her that she would need to pay $3,000 in order to have her supply reconnected. She said she could afford $100. The retailer said it would not accept this amount and referred her to Financial Counselling Australia. Her electricity was disconnected. She moved out of the property to stay in a safe house while she was at risk of family violence.
Six months later, her financial counsellor contacted EWOV to arrange for the supply to be reconnected and a payment plan arranged, so Ms J could move back in. She was finding this difficult as she still owed over $5,000 on the closed account.
Due to Ms M's circumstances we moved straight to an Investigation.
The Investigation
The retailer confirmed Ms J opened the account in 2014 and had made six payments only. When she closed it in June 2017, she owed $5,087.57. It said a Utility Relief Grant application had been successful in mid-2015. The retailer offered a credit of $1,027.51 as a debt waiver, reducing the arrears to $4,060.06. It proposed four payment options. It confirmed it had reconnected supply after Ms J contacted EWOV.
To gain a better understanding of Ms J's current situation, we undertook a detailed financial assessment. This identified some practical changes, which Ms J could make to bring the cost of her usage closer to her capacity to pay for it. We discussed these with her.
The Outcome
The retailer offered a higher debt waiver of $2,493.78, in recognition of Ms J's circumstances. This reduced the arrears to $2,653.32. The retailer accepted her proposed payment arrangement of $50 a fortnight, saying it would need to be reviewed in three months. It said that once she made four fortnightly payments of $50, Ms J could be accepted into its hardship program. The retailer said its assistance came with the expectation that Ms J would bring her capacity to pay and her consumption into line. Ms M was satisfied with this outcome.
We also assessed whether the retailer followed the correct procedures when disconnecting Ms J’s electricity supply. As we couldn't reach an agreement with the retailer, the findings of our Investigation were provided to the Essential Services Commission for its consideration and advice. WDP/2017/940
