Energy and water disconnections on the rise in mortgage belt

New research released today by the Public Interest Advocacy Centre (PIAC) shows a considerable increase in the number of working families being disconnected from energy and water services for failing to pay bills.

The new report, Cut Off II: The experience of utility disconnections, updates previous research conducted into energy and water disconnections in NSW in 2005 and shows who is being disconnected, why and what were their circumstances at the time.

Senior Policy Officer with PIAC’s Energy + Water Consumers’ Advocacy Program (EWCAP) Mark Ludbrooke said, ‘The new research shows that there has been an increase in the number of working families that have been disconnected. Obviously this is of concern given that energy and water prices are on the rise and that tougher economic times ahead will further increase financial pressures on many families struggling to pay debts and coping with unemployment.’

Other findings show that most people disconnected were not offered a payment plan by energy and water retailers and half of those on a payment plan said it was not affordable. As well, a third of survey respondents said they had had no contact with the retailer prior to being disconnected.

‘PIAC acknowledges the help of the retailers in putting this research together and recognises that many retailers have improved the way in which they deal with customers who are having difficulty paying their bills but more still needs to be done. PIAC urges all energy and water retailers to continue to be proactive in assisting disadvantaged consumers to avoid disconnection. As well, the NSW Government needs to increase and broaden the eligibility criteria for pensioner energy rebates and provide more funding for energy vouchers,’ Mr Ludbrooke added.

Along with the Report, EWCAP is also presenting its recommendations flowing from the findings (a copy is provided with this media release). These recommendations are addressed to both retailers and the NSW Government.

The report will be launched by PIAC CEO Robin Banks at the office of the Energy and Water Ombudsman NSW (EWON), Level 10, 323 Castlereagh Street, Sydney at 11am, Friday 30 January 2009.

For copies of the report, contact Mark Ludbrooke on 02 8898 6518

For media information, contact Mark Warren, Media and Communications Adviser, PIAC 02 8898 6526, 0414 617 806, [email protected]


Recommendations from Cut Off II:
The experience of utility disconnections

Recommendation 1: That all Retailers work with EWON, NCOSS and PIAC to improve their processes for identifying customers experiencing hardship.

Recommendation 2: That all Retailers establish hardship teams in call centres, independent from credit teams, and refer all customers identified as experiencing hardship to hardship teams.

Recommendation 3: That the NSW Government legislate to require all retailers to develop hardship programs that provide crisis support, debt management, referral to community services, and energy efficiency initiatives. Hardship programs to be approved by the Minister for Energy and no one participating in a hardship program to be disconnected.

Recommendation 4: That the NSW Government oblige all retailers to inform customers experiencing hardship about their right to access the hardship program.

Recommendation 5: That all Retailers work with EWON, NCOSS and PIAC to improve their processes for developing affordable payment plans that meet the needs of customers.

Recommendation 6: That all Retailers provide comprehensive training to appropriate staff on identifying and understanding hardship, cross cultural communication, avoiding disconnections, and determining appropriate payment plans.

Recommendation 7: That the Independent Pricing and Regulatory Tribunal (IPART) audit all Retailers to examine, compare and publicly report on compliance with obligations related to disconnections.

Recommendation 8: That the NSW Government take action against retailers where there is failure to comply with regulatory obligations relating to disconnections.

Recommendation 9: That the NSW Government increase the pensioner energy rebate to 20 per cent of the annual energy bill (with a minimum rebate of $130 indexed against energy price increases) to reflect the increasing price of electricity.

Recommendation 10: That the NSW Government broaden the eligibility criteria for the pensioner energy rebate to include all Commonwealth Health Care Card holders.

Recommendation 11: That the NSW Government increase funding of the EAPA (Energy Accounts Payment Assistance) scheme to meet demand for vouchers, increase the maximum number of vouchers that may be allocated to customers, and index the cap on vouchers to increases in electricity prices. That the NSW Government also broaden the range of EAPA providers to ensure accessibility for all customers experiencing financial disadvantage in a crisis situation.

Recommendation 12: That the NSW Government legislate to prohibit retailers from charging reconnection and other fees where retailers have failed to comply with disconnection obligations.

MEDIA CONTACT: Dominic O’Grady, Media and Communications Officer,

Public Interest Advocacy Centre. Ph: 02 8898 6532 or 0400 110 169

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