Scottish Power to pay £18m for customer service failings
Scottish Power customers may be in line for a share of £15m after the energy regulator found the Big Six provider guilty of a catalogue of errors.
A further £3 million will be given to charity, which charity is yet to be decided.
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The penalty comes as Ofgem found Scottish Power didn’t do enough to protect its customers from issues that arose from the implementation of a new IT system in 2013.
This resulted in a significant increase in the number of complaints the supplier received. In particular:
- Many customers experienced “unacceptably” long call waiting times with many calling multiple times and hanging up before getting through.
- Some complaints were handled “poorly” with a “significant number” taking too long to resolve.
- Thousands of Ombudsman rulings were not implemented within the required 28 days.
- Over 300,000 customers received late final bills. This meant some did not promptly receive money they were owed because they were in-credit at the time of switching.
In March 2015, Scottish Power also stopped proactive selling for 12 days after Ofgem found it failed to meet a target to remove a backlog of outstanding Energy Ombudsman decisions.
However, Ofgem says that since it opened its investigation in November 2014, Scottish Power has improved its customer service with the average call waiting time, rate of abandoned calls and the number of Ombudsman cases all reduced by more than half.
Ofgem adds that the number of late bills has also fallen by 75%.
Dermot Nolan, Ofgem chief executive says: “Scottish Power let its customers down during the implementation of a new IT system. When things went wrong, it didn’t act quickly enough to fix them. This created frustration and worry for many customers, who also wasted a lot of time trying to contact the supplier by phone.
“The £18m payment sends a strong message to all energy companies about the importance of treating consumers well at all times, including while new systems are put in place.”
I’m a Scottish Power customer. Am I due compensation?
Scottish Power says vulnerable customers who had a complaint or who received a late bill between 1 April 2014 and 31 March 2016 will get some form of payment from the £15m fund.
These customers will be identified though Scottish Power’s ‘Priority Services Register’ scheme or through its Warm Home Discount scheme, and you'll be contacted automatically.
About 100,000 customers are thought to be due a goodwill payment of between £100 and £150, which will be credited to customer's energy accounts.
We’re awaiting confirmation on whether former Scottish Power customers affected by the issues will get a refund.
Unhappy with your energy provider? Complain
If you’re unhappy with your energy provider, complain to it in the first instance. You can use free online tool Resolver.co.uk to help.
Scottish Power says customers will not be left out of pocket as a result of these issues, so complain if you feel you've been hard done by.
If you don’t get a response or are unhappy with the response you do get, you can take your complaint to the free Ombudsman Services to look into.
‘We apologise unreservedly to those customers affected’
Neil Clitheroe, Scottish Power’s CEO of energy retail and generation, says: “ScottishPower has worked with Ofgem throughout this investigation. We apologise unreservedly to those customers affected.
“In order to upgrade our old IT systems, we invested £200 million on new technology to allow us to deliver smarter digital products and services to benefit our customers. During the complex transition between systems we encountered a range of technical issues. This lead to an unacceptable increase in complaints and reduced the quality of our customer service.
“I gave a guarantee that no customer would be left out of pocket by these issues and we continue to compensate customers who have been affected.”
If you’ve have a complaint about a financial service product you have bought but the company you bought it from refuses to resolve your problem after eight weeks, the Ombudsman can help. The Ombudsman will investigate and resolve the matter. The Ombudsman is independent and its service is free to consumers. The Ombudsman may find in the company’s favour but consumers don’t have accept its decision and are always free to go to court instead. But if they do accept an Ombudsman’s decision, it is binding both on them and on the business.