British Gas has come under pressure to outline the compensation it will give to 'vulnerable' customers who faced having debt collectors forcibly install a prepayment meter in their homes.
Energy minister Graham Stuart approached British Gas owner Centrica to explain the 'redress' for 'mistreated customers'. Meanwhile, Ofgem has urgently called for "action, not warm words" after ordering all domestic energy companies to suspend the practice of forcibly installing prepayment meters.
It comes after shares in Centrica plummeted by more than 3 per cent on Thursday - one of the largest fallers on the FTSE 100. A Times newspaper investigation revealed that some disabled and mentally ill customers were forced by British Gas to go on the meters or risk having their gas cut off.
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Mr Stuart said he was "horrified" to read about the "mistreatment" of these customers. He said: "I have asked Mr O’Shea to report back to me urgently outlining the role he will take personally to fix these very serious cultural issues.
“I told him I want to see these vulnerable, mistreated customers identified and redress provided. I will be monitoring matters extremely closely to make sure justice prevails.”
Ofgem chief executive, Jonathan Brearley, said he was issued a warning to "all domestic energy suppliers to get their house in order on forced instalments of prepayment meters". He also called for the "biggest ever market review" into the meters to "uncover poor practice".
He added: "I will not hesitate to take the strongest action in our powers where needed. No energy CEO can shirk their legal and moral responsibilities to protect their own customers, especially the most vulnerable.
“These are serious allegations for British Gas to deal with and we are opening a comprehensive investigation into British Gas on this issue. It is right British Gas has apologised following the very worrying allegations in The Times, but millions of customers expect action not warm words.”
Several energy companies including British Gas and EDF have suspended the controversial practice. Meanwhile, OVO and Octopus Energy have stated they have not used the practice recently.
Centrica’s Mr O’Shea said: “Protecting vulnerable customers is an absolute priority and we have clear processes and policies to ensure we manage customer debt carefully and safely. The allegations around our third-party contractor Arvato are unacceptable and we immediately suspended their warrant activity.”
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