No-one likes being ripped off. We all want to avoid paying more than we need, for something which doesn’t do what it claims on the tin.
Fortunately we all learn from experience, so we take our business somewhere else next time if we’re not happy with the deal we got. But there’s one area where the normal rules don’t seem to apply; energy. It’s the only industry which exploits its most loyal customers, rather than rewarding them. Most firms have programmes to keep their best customers happy, from airmiles to loyalty cards, so they keep coming back.
But not in energy. Two thirds of us are on the ‘standard variable tariff’, which can be more than 50% more expensive than the best deals. And the people on it are the ones who are most loyal; who haven’t switched to different supplier recently. Or, for a lot of us, ever.
And when we remember to switch, energy companies will quietly switch us to the most expensive tariff when our chosen deal finishes after a year or 18 months, unless we do something about it.
We aren’t powerless though. Some of us are organised enough to switch regularly and, for the rest of us, there are new services like Flipper which handle the entire switching process without fuss.
But they won’t solve the problem fast enough, so the only way to stop the rip-off is to introduce a relative price cap, which limits the size of the mark-up between the best deals and the standard variable one which most of us are on. You’d still save money by switching, but you’d be protected from being ripped off if you didn’t.
It’s such a good idea I’ve organised a Parliamentary debate and won cross-party support for it too. Next step is to persuade Ministers that it’s worth doing. Watch this space!