Martin Lewis is urging more than 100,000 energy customers to check if they received £60 compensation from their former energy supplier if they switched during 2020/21. Ofgem announced on Wednesday that E.On Next, Octopus and Good Energy have paid £8 million over compensation failures after lengthy delays in producing final bills to customers when they switched suppliers.
The consumer champion told listeners on BBC Radio 5 Live that the energy watchdog said the three suppliers either missed or delayed compensation payouts that were due when they did not provide a final bill within six weeks, as required when a customer switches to another provider.
Under rules brought in by the energy regulator in May 2020, customers are entitled to a £30 payment each if a final bill is not produced in six weeks, with a further £30 due if the compensation is not provided within another 10 working days.
Martin explained this compensation should have been paid by either Bacs or cheque to 95,000 customers previously with E.On Next, 19,000 with Octopus and 350 with Good Energy.
He said: “Just over 100,000 customers are being given £8 million compensation payments, with £6.3 million being paid direct to customers - around £60 - and £1.7 million to Ofgem’s energy redress fund.
“Most people should have been got these payments already, you should have been given your £60, so if you can think back - and I know this is a bit difficult - if you left E.on Next, Octopus or Good Energy in 2020/21 and it did not send you your final bill on time, you should be due this.”
But he warned that many people may have mistakenly thrown the £60 cheque away thinking it was a scam and some may have received the money directly into their bank account and not known why.
He said: “If you get a cheque for £60 and you’re not expecting it then rightly, in a world where we have a wild west of unregulated scams, some people may not know that the cheque ws legitimate and may not have paid it into their bank account.
“There’s also a chance the energy provider may not have had the correct details.”
However, all is not lost, as Martin explained what to do if you switched from one of those energy suppliers and have not received the compensation. He said: “If you think you’re due the money and not sure if you received it within the strict six-week deadline then get in touch with the company - E.on is the big culprit, then Octopus and Good Energy to a lesser extent - and say ‘do you owe me money? should I have got some money from you?’”
He added that the reason Ofgem has gone public about this is because we are likely to have switching coming back in the “latter half of this year, so it’s a reminder to companies and it’s also Ofgem wanting to show that it does have some teeth”.
Breakdown of compensation
- E.On Next - paid out £5.5 million to almost 95,000 customers
- Octopus - paid around £750,000 to 19,000 customers
- Good Energy - paid around 350 customers a combined total of £18,000
Neil Kenward, director for strategy at Ofgem, said: “Ofgem introduced these standards to make sure customers get the service they deserve when switching energy supplier.
“Our rules mean that where energy companies drag their heels, customers are automatically compensated. We won’t hesitate to hold energy companies to account, as we have done today.
“As the energy market starts to recover, we’ll likely see a return to more switching, and this action is a reminder to suppliers that they need to make switching as easy and convenient as possible for their customers, and where they cause undue delay, pay compensation swiftly.”
A spokesman for E.On told the PA news agency that the group had self-reported the issue to Ofgem last year and had since compensated customers and made changes in its billing processes. He said: “At the time, we contacted affected customers to apologise and sent them their missing payments.
“We also paid £1.3 million to Ofgem’s Energy Industry Voluntary Redress Scheme Fund in recognition of our failings. We have since taken steps to ensure this error does not happen again.”
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