5. Paying your arrears
As the supply of energy is governed by contracts, it is open to you and your supplier to negotiate and find a solution to your arrears. However, because of the large number of customers of each supplier, energy companies may find it difficult to reach individual solutions. In legal theory – and in practice – it is possible for suppliers to clear arrears by an individual payment scheme, settlement payment agreement or even by the supplier writing them off, wholly or in part. This is even more likely in cases where suppliers have been at fault.
Unfortunately, it may be difficult to get a supplier to exercise any such option at first approach, since customer service staff may not be fully aware of the range of options legally available. Persistence may be necessary and unique proposals may need to be put into writing.
Before negotiating with your supplier, consider which way of repaying your arrears best suits your needs. Also consider the supplier’s internal codes of practice, policy and procedures currently in place to recover arrears. Consider the practicalities of using a particular avenue and how convenient it is for you to make your payments – it is important to make an arrangement or settlement which you can keep. Chapter 4 looks at the advantages and disadvantages of the various methods of payment. Generally, you will need to discharge arrears:
•through a short-term arrangement; or
•in instalments through a longer-term payment plan; or
•through a prepayment meter; or
•through the Fuel Direct scheme.
The ways these various options work are discussed below. The payment method available may also depend on your payment arrangements in the past. Your supplier is less likely to agree to your choice of method if you have a succession of broken arrangements. The supplier may take the view that a prepayment meter or benefit deductions (the Fuel Direct scheme – see here) offers the best chance of secure and regular payment without increasing arrears. Energy companies usually expect you to reach arrangements by telephone. It is advisable to back up any conversations in writing by email and enter into correspondence wherever possible, keeping copies. Keep a record of any failure to respond to raise in your defence at a later date should the matter result in court action.
Wherever possible, deal with the supplier’s complaints or customer service department, as call centre advisers often know little about the relevant law or about ways a dispute may be lawfully settled. Some suppliers have appropriate extra care or support teams who may be able to get involved with a view to resolving problems if you have a need or vulnerability. Provide as much information about your financial situation as you can so that the staff can establish the most suitable method of payment for you.1Condition 27 SLC Be prepared to provide information about your income and expenditure and, if you can, provide a detailed financial statement listing all your liabilities (see here). Inform the supplier if anyone in your home is elderly, disabled, chronically sick, under five years old, has a mental health condition, if you claim a means-tested benefit, or if there are any other factors which cause you financial hardship, such as multiple debts, redundancy or a sudden change in circumstances. If you are not satisfied with the options made available to you, consider using your supplier’s complaints procedure. Citizens Advice consumer service can provide advice where there is a dispute about the choice of a meter or method of payment or if a deadlock situation is reached. If you are in a vulnerable situation the Extra Help Unit may help (see here). The Energy Ombudsman may be able to intervene where the complaints system has been exhausted (see Chapter 14). Consider applying for charitable assistance to repay or reduce arrears if you are experiencing serious hardship (see here).