Consumers overcharged by more than £6 billion on household bills
Cash-strapped consumers are being warned not to rely on companies getting their sums right after new research from uSwitch.com revealed an ‘epidemic' of overcharging on household bills in the last year. The findings suggest that companies responsible for essential bills, such as utilities, telecoms and mortgages, may have overcharged by more than £6 billion in the last year, with 95% of cases identified by the customer rather than the bill provider.
Almost six in ten consumers (57%) - potentially 28 million people - have been overcharged on at least one household bill in the last year. Over a quarter (26%) have fallen victim two or more times, while one in ten (10%) have been hit more than three times in the last year. The average amount that people have been overcharged by is £229, although one in ten (10%) have been overcharged by £500 or more - enough to cause most consumers considerable financial pressure.
Despite the potential hardship it can cause, those who have been overcharged have had to wait 58 days or almost two months on average to get the money repaid. However, for more than one in ten (12%) it took between two to six months to get their money back again. Unfortunately, not all have been so lucky. More than one in ten (12%) of those overcharged in the last year are still trying to get the issue resolved while a further 13% never got their money back.
As well as the stress and worry, consumers also have to expend time and effort in trying to recover the money they have lost as a result of overcharging. In the last year, consumers were forced to spend an average of 6 hours and an estimated £22 on phone calls and correspondence trying to sort out overcharging. Just 7% were automatically refunded these costs by the company involved.
While many were prepared to forgo these costs, 48% of consumers asked for them to be refunded, but only half (24%) were successful. The number offered compensation or a ‘goodwill gesture' is even lower at just 15%. Of these, the majority (91%) were given up to £50.
Ann Robinson, Director of Consumer Policy at uSwitch.com, says: "There has been an epidemic of overcharging on household bills in the last year and yet we are still potentially looking at the tip of an iceberg. It seems to be down to consumers to spot where they have been overcharged and, with some household bills being so complicated, more instances will undoubtedly have slipped through the net.
"What this does tell us though is that people must look at their bills and not take it for granted that a company has got its sums right. I would also urge companies to do right by their customers too and to ensure that their bills are simple, clear and easy to understand. With 95% of overcharging spotted by customers rather than the bill provider, it's imperative that consumers are able to spot and resolve any mistakes quickly."