Npower to halt telesales unless it resolves billing issues

Ofgem has secured commitments from npower to take immediate action to put right its billing and complaints issues, alongside launching a wider investigation into customer service failings under Ofgem’s new Standards of Conduct.
 
Ofgem is requiring npower to resolve major billing issues no later than the end of August 2014 and publish monthly progress updates on its website. Failure to meet monthly targets will result in npower ceasing all proactive telesales to new customers until they are met. The parallel investigation into npower’s customer service failings is the first case to be opened under Ofgem’s new Standards of Conduct (SoC) and could lead to a financial penalty or redress payment if they are found to have broken rules.
 
Sarah Harrison, senior partner in charge of enforcement said: “npower customers have suffered service failures for too long, that’s why Ofgem has secured binding commitments from npower to reduce its bill backlog or face curbs on sales, alongside launching a wider investigation under Ofgem’s new Standards of Conduct.
 
“Ofgem has been monitoring npower’s service closely and we have been increasingly concerned about the slow progress to tackle failings. npower’s recovery plan has not delivered as far and fast as is necessary. Our analysis of complaints data also raises some serious concerns which will be thoroughly examined in our investigation.
 
There has been some progress since Ofgem’s intervention in December – longstanding problems in relation to new customers and the set-up of direct debit payments have now been tackled, and many of the oldest cases of late billing have been cleared.
 
This move follows Ofgem’s intervention in December 2013 which led to an apology by npower’s CEO Paul Massara to all its customers, payment of £1m to good causes, and a commitment that no customer would be left out of pocket as a result of billing failures.
 
The SoC are part of Ofgem’s reforms for a simpler, clearer and fairer energy market. The SoC state that suppliers must treat consumers fairly. They are wide-ranging and cover supplier behaviour, the information that they provide to consumers, and their internal processes. The investigation will also look into npower’s compliance with industry complaint handling standards.