MEDIA RELEASE
Electricity & Gas consumers to lose consumer protections
Energy Action Group Inc
PO Box 136
North Melbourne 3051
Tel 041736 2709
Friday July 7th
Electricity and gas consumer watchdog, the Energy Action Group today warned
that proposed minimum standards for consumer protection will be reduced
with full competition which begins next year.
The Office of the Regulator-General (ORG) has released its draft decision
regarding minimum standards for full retail competition. Energy Action
Group President, Ms Andrea Sharam said that the draft decision divides the
current safeguards into 'core' and non-core' rights.
"The draft decision moots the trading away of the non-core rights. Many of
the consumer rights we currently take for granted today will only be
available in the future if the consumer is willing to pay extra for them.
"Financial pressure on households will result in many customers
relinquishing these non-core rights for price cuts. The problem is that
it's a form of insurance. Many less well off people do not take out
insurance because they cannot afford to do so. This leaves them extremely
vulnerable when problems occur. Likewise with electricity and gas,
customers will not think about these protections until they need them. Then
it will be too late.
Ms Sharam said that it was possible that customers will face a loss of
control over when and how they pay their utility bills, and the information
on the bill.
"To pay one's bill in person will eventually cost the customer more than
using direct debit. Utilities love direct debit, but it is incredibly
impractical for customers on low fixed income such as pensioners and the
unemployed. The administration fee for paying in person at agencies such as
Australia Post is intended to force customers into direct debit.
Electricity retailers have also been resisting mandatory itemisation on the
bill. The Energy Action Group has argued to the ORG that itemisation is
essential if the customer is to understand the basis of their bill, and to
foster competition.
"There is a pretty basic problem with the ORG's approach of dividing
consumer rights into core and non-core. It actually undermines regulation
itself. This is a case of rolling back regulation. It has taken consumer
advocates many years to get these protections, and the experience of
de-regulation in telecommunications and banking gives us no reason to
believe that low income people will better off with competition. We don't
want a service that discriminates between low income customers and well to
do customers. The regulator and the Government need to work to ensure
protections and benefits for all."
For further information please contact Ms Andrea Sharam on 041 736 2709
The Energy Action Group Inc is a consumer & environmental advocacy service
for domestic gas, electricity and water users. EAG is membership based and
has been undertaking advocacy in the utilities area since the late 1970s.
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