Ofgem slams 'frankly awful' energy complaints handling

Bulb in hand

Energy watchdog Ofgem has written to the chief executives of the UK's big suppliers demanding they improve complaints handling.

The watchdog has found that 57% of energy customers are unhappy with the way their complaints are dealt with.

It stated that has been an "industry-wide failure" to handle complaints to an acceptable standard.

The energy suppliers must improve their speed in resolving customer problems, be more proactive in finding solutions, and communicate better with customers. If they fail to do so, they could face fines, an Ofgem spokesperson told Moneywise.

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Ofgem chief executive Dermot Nolan has given suppliers a three-month deadline to carry out the review.

He said: "Satisfaction scores are frankly awful. Almost all energy suppliers need to improve their complaints handling as a matter of urgency. There are real business benefits to good complaints handling schemes, and it shouldn't need a regulator to tell companies about the importance of this.

"Suppliers must now tell their customers what steps they will be taking to put things right. We are already formally investigating Npower about complaints handling and other customer service issues, and this should send a strong signal to all suppliers that, where necessary, we will take action."

In June, Ofgem announced the UK energy market would face a full investigation after it formally referred it to the Competitions and Market Authority.

The investigation, which is expected to take 18 months to complete, will look at whether there is a lack of competition in the market leading to an unfair deal for consumers.

In response to the findings, Energy UK, the body that represents the energy industry, said: "Handling complaints well is a must. Suppliers are committed to improving and a programme of change is underway."

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How about if the energy companies were made to provide free energy to their customers until they have sorted themselves out - perhaps this would encourage them some more?