Scottish Power, the second most complained about supplier amongst the Big 6 has suffered a collapse over recent months rivalled only by the oil price.
Ofgem, the energy regulator, fresh from their chastisement of nPower, the most complained about supplier amongst the Big 6, has set Scottish Power an ultimatum:
Improve or you will no longer be allowed to sell in the market.
In shades of the targets set for nPower over the summer of 2014 and its ultimately ‘successful’ avoidance of that same ultimate sanction, Scottish Power has been given 3 months to improve its customer service performance.
Ofgem has separately launched an investigation into the supplier’s treatment of customer complaints and its final billing performance.
Crime
Making plan the areas most in need of attention Ofgem have called on Scottish Power to deliver the following improvements:
- Significantly improve the speed of answering customer calls by the end of January 2015
- Reduce the number of overdue bills. Today more than 75,000 are late; this must drop to 30,000 by the end of December.
- Completely remove the backlog for acting on Ombudsman decisions for individual complaints by the end of November.
Sarah Harrison, senior partner in charge of enforcement at Ofgem, said:
“Scottish Power’s customers are experiencing unacceptably long call waiting times and a drastic drop in overall customer satisfaction. Ofgem’s action today will drive immediate improvements for Scottish Power customers. In a properly functioning market we would expect companies to compete keenly on service. The need for our intervention here is yet more evidence that the energy market is not working for consumers. This further justifies our decision to refer the market to the Competition and Markets Authority.
“The investigation we launched today is the third time we have used our new standards of conduct to make suppliers treat consumers fairly. This is a clear signal to suppliers to up their game and give consumers the service they are entitled to.”
In a letter to Ofgem, but not to his long suffering customer base, Scottish Power’s Chief Executive, Neil Clitheroe, said:
“I would like to apologise unreservedly to any customer who has not received the level of service that they deserve from Scottish Power in recent months and provide my personal assurance that we will do what we can to correct every problem, pay appropriate compensation and ensure that no customer is disadvantaged.”
Ofgem’s statement promised that:
“Ofgem will assess performance against these targets and take into account factors that may be outside Scottish Power’s control, such as unforeseeable events which could affect its ability to comply. ”Unforeseeable”, however, is a high threshold, and Ofgem expects contingency plans to be in place for most circumstances.”
Sanction
Ofgem however claims that any missed targets set by would result in a ban on “proactive sales activities”:
This would involve Scottish Power having to cease all outbound telesales and face to face sales until such time that they meet and maintain these targets.
Whether Scottish Power follow nPower and improve sufficiently in 3 months to prevent damaging sanctions remains to be seen, whether Ofgem follow through on their threats is equally in question.