Ombudsman's Report
BY CLARE PETRE, ENERGY & WATER OMBUDSMAN NSW
Overview of complaints this year
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EWON had a 17% increase in complaints this year as we finalised 17,559 matters, up from 15,048 the previous year.
The increase was significant but expected, given that complaints have continued to rise since EWON was established 12 years ago. In this time, major industry changes and price increases have been accompanied by heightened consumer expectations of energy and water services, and media and community interest in utilities. Consumers no longer take their utilities for granted. They closely check their bills and will query them if they don’t seem right.
Given this, it is not surprising that of all the complaints we received this year, 55% (9669 complaints) involved billing issues.
Customers are particularly disappointed when a clear error by their provider is not addressed quickly. Customers may also receive little acknowledgement of the inconvenience and cost the error has caused them. The provider’s response – or lack thereof – can make the customer feel their complaint is not being taken seriously.
Of the billing complaints we received, 3900 were about high or disputed bills. In a number of high bill complaints, our investigation found that the retailer’s billing appeared to be accurate and we provided detailed information to the customer about their billing, with referrals to energy saving information where appropriate. We continue to encourage customers to pay the portion of the bill they consider reasonable while their complaint is investigated, as this reduces the potential for large arrears to build. It also shows good faith given that customers are generally not disputing the entire bill.
With heightened consumer expectations, there is greater onus on retailers and distributors to provide good service, communicate effectively with customers and ensure their contact centre staff are able to make appropriate referrals.
We will continue to work closely with providers to encourage timely resolution of complaints and to promote a resolution focused approach based on reasonableness and fairness, so that customers do not need to come to or return to EWON.
Consumer issues
Affordability
Customers are expressing concern and anxiety about paying their bills, particularly in light of political and media debate about further price increases. Their anxiety can increase if there is a delay in their bill being issued or if they are waiting for an actual read.
During the year, there was an 8% increase (1502 complaints) in customers who were facing disconnection and an 18% increase (813 complaints) in customers who had been disconnected due to financial hardship. More customers with payment difficulties will put pressure on the Energy Accounts Payment Assistance scheme, both in terms of available assistance and ensuring vouchers are distributed to areas where they are most needed. We have seen an increasing number of complaints involving debt collection and credit default listings. In some cases, customers have had their credit rating affected by a relatively small utility debt. We raised this issue in a submission earlier this year on proposed changes to credit reporting. In our submission to the Senate Finance and Public Administration Committee, we suggested that the minimum amount for which a customer can be credit listed should be raised from $100 to $300.
In September 2010, EWON wrote to the Australian Communications and Media Authority to support a pricing review of calls to 1800 and 13/1300 numbers from mobile phones. We are concerned that calls to EWON’s freecall 1800 number are in fact not ‘free’ to callers from mobile phones. (If a customer identifies that they are ringing EWON from a mobile we will ring them back to save them further expense.)
We are also concerned that utility retailers are not accessible to all customers, as a number of customers complain about waiting in long call centre queues, watching the last of their mobile phone credit diminish. This is particularly regrettable for any customer who is in financial difficulty and calling the retailer from their mobile to discuss an affordable payment arrangement.
Marketing
Complaints about energy marketing remained fairly consistent for most of the year prior to the sale of the state-owned electricity retailers – Country Energy, EnergyAustralia and Integral Energy. After the sale in March 2011, EWON saw marketing complaints increase as retailers tried to increase market share and/or retain customers. Some marketers took advantage of the change to mislead customers into switching retailers. We raised this issue with the retailers concerned and the regulators.
Our complaint statistics indicate that culturally and linguistically diverse customers, many of whom are vulnerable because of limited English, had above average transfer and marketing related complaints. The fact that vulnerable customers continue to be misled and pressured is an area of concern for EWON, particularly as marketing activity increases.
Misleading customers or not properly informing them about the switching process will only increase customer frustration and erode confidence in the industry and in energy competition.
Consumers need access to comprehensive information to help them compare energy offers and make the right choice for their household. In this regard, EWON referred customers to the government energy comparator site, www.myenergyoffers.nsw.gov.au rather than commercial switching sites that may not have information on all retailer offers in NSW. In some cases the commercial switching sites act more as a broker for particular companies.
Solar and renewable energy
Throughout the year, EWON received a steady stream of complaints from customers who had installed or were in the process of installing solar panels. Overall, we received 1389 complaints about renewable energy installations, primarily solar-related. Of these, 621 related to the application of the feed-in tariff. There were 324 complaints, regarding the quality, safety or other aspects of the installation, which were out of our jurisdiction and referred to NSW Fair Trading.
Regulation
EWON made submissions to the Australian Energy Regulator on a range of issues related to the National Energy Customer Framework including:
- retail pricing information
- compliance
- performance reporting
- retailer of last resort arrangements.
Our state government submissions dealt with proposals to address affordability issues such as:
- extension of the Low Income Household Rebate to retirement villages
- an expanded Energy Accounts Payment Assistance scheme
- the introduction of a service to property charge rebate
- the availability of pay-as-you-go meters for NSW customers who might choose this option because it suits their household or payment arrangements.
We queried whether networks could contribute in some way to assisting customers in financial hardship, given that a significant part of price increases is driven by network charges.
We noted it would be useful for a discussion to be facilitated at the national level around financial hardship. The discussion could examine issues such as a social tariff and energy affordability benchmarks.
ANZOA/ANZEWON report
The Australia & New Zealand Energy and Water Ombudsman Network (ANZEWON) comprises the Ombudsmen from NSW, Victoria, Queensland, Tasmania, Western Australia and New Zealand. We meet several times a year to share ideas and experiences and to work towards as much consistency and efficiency as possible in a national market with many members in common. This year we farewelled Barry Adams when he retired as Energy and Water Ombudsman Queensland.
ANZEWON members took up the issue of the cost of mobile phone calls to 1800/1300 numbers, as this impacts on customers trying to contact all our offices and our member companies.
The Australian and New Zealand Ombudsman Association (ANZOA) is a broader group of both industry and parliamentary Ombudsmen. ANZOA’s Executive meets regularly and our staff participate in various interest groups.
The ANZOA Executive reviewed elements of the six benchmarks that underpin our approach – accessibility, independence, fairness, accountability, efficiency and effectiveness – to ensure that they keep pace with the changing consumer and industry environment. ANZOA issued a policy position calling for stronger action on inappropriate use of the term ‘Ombudsman’. In line with this position, ANZOA members
also supported a submission by EWON to an enquiry by the NSW Ombudsman on the inappropriate use of the term ‘internal ombudsman’ in some agencies.
I thank my Ombudsman colleagues in ANZEWON and ANZOA for your tremendous support and willingness to share information and experiences, in the continuing goal of improved service and effectiveness of our offices.
Acknowledgements
This year our staff managed the transition to a new complaints management database, as well as an expansion of our staff base to deal with an increasing workload. As with most changes in software and technology, this required staff to rapidly learn and implement new processes and systems. I am very grateful to all staff for their support, perseverance and willingness to contribute to the development process of the new complaints system. They also dealt with a workload that can only be described as relentless with great professionalism and commitment; we sincerely appreciate your efforts.
I would also like to thank:
- Members of EWON’s Board and Council for your ongoing support, expertise, and rigorous oversight
- Energy and water provider members of EWON for your professional and cooperative relationship in trying to resolve customer complaints as quickly as possible
- Community workers with whom we work so closely. Without your direct advocacy for your clients in resolving utility issues, EWON’s workload would be even higher
- Our key stakeholders – NSW Trade & Investment, Independent Pricing and Regulatory Tribunal, Australian Energy Regulator, NSW Ombudsman, NSW Fair Trading – for your support and constructive working relationships.
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