Energy companies must stop "Del Boy" tricks
Customers who have been mis-sold gas and electricity on their doorstep should be compensated, says a government committee report.
The Energy and Climate Change Committee report says energy companies may be guilty of giving misleading and confusing information through doorstop selling.
In 40% of cases consumers have not saved any money when switching tariffs in this way.
Doorstop sellers have been accused confusing customers with a variety of different tariffs and pressurising people into switching without giving information on all the options available.
Recent price rises were also criticised and the committee said customers who use the least energy will be hit the hardest from August when the increases are put into effect and the committee is now calling for stricter regulations over price increases
The committee's findings are a response to Ofgem's review of the retail energy market, published in March.
This long-overdue compensation should have been sorted out years ago, said the committee.
Chief executive of Consumer Focus, Mike O'Connor, says cold calling on the doorstep should end now.
"Organised confusion, pressured selling, misleading information - no market should be able to operate like that, and especially not one that provides an essential product that is getting more and more expensive."
Tim Yeo MP, chairman of the committee, said if consumers are being persuaded to switch contracts when it's not in their best interests, by salespeople keen to earn commission, it would only be right for the energy companies to "cough-up" compensation.
"SSE recently announced that it would suspend doorstep selling following its hearing in front of the select committee, we welcome that decision. The rest of the Big Six should ditch the 'Del Boy' sales tricks and concentrate on giving customers the information they need to choose the correct contract," he added.
The practice of a dishonest salesperson misrepresenting or misleading an investor about the characteristics of a product or service. For example, selling a person with no dependants a whole-of-life policy. There have been notable mis-selling scandals in the past, including endowment policies tied to mortgages, employees persuaded to leave final salary pensions in favour of money purchase pensions (which paid large commissions to salespeople) and payment protection insurance. There is no legal definition of mis-selling; rather the Financial Services Authority (FSA) issues clarifying guidelines and hopes companies comply with them.