British Gas has announced it will stop applying for court warrants to enter customers’ homes and fit prepayment meters following reports they had been forced on “vulnerable” customers.
Energy companies can obtain court warrants which give them legal rights to enter people’s homes and fit prepayment meters if customers have not paid their bills.
Customers must then top up to continue receiving gas supplies, and if they fail to do so they risk their heating being cut off.
An undercover reporter for the newspaper worked for debt collecting contractor Arvato Financial Solutions and accompanied agents who used court warrants to gain entry into customers’ homes to force-fit these meters.
Some of the “vulnerable” customers the Times reporter came across while working at Arvato Financial Solutions included a single father with three young children and a mother with a four-week-old baby.
Owner of British Gas, Centrica, announced it was suspending “all warrant activity” after the newspaper’s article was published.
The parent company will also launch an investigation into the claims.
“The allegations around our third-party contractor Arvato are unacceptable and we immediately suspended their warrant activity.
“Having recently reviewed our internal processes to support our prepayment customers as well as creating a new £10 million fund to support those prepayment customers who need help the most, I am extremely disappointed that this has occurred.
“As a result, on Wednesday morning, we took a further decision to suspend all our prepayment warrant activity at least until the end of the winter.
“We need to strike a balance between managing spiralling bad debt and being aware that there are those who refuse to pay and those who cannot pay. We think Government, industry and the regulator need to come together to agree a long-term plan to address this and ultimately create an energy market that is sustainable.”
Energy regulator Ofgem has also announced it will launch an investigation.
A spokesperson said: “These are extremely serious allegations from The Times which we will investigate urgently with British Gas and we won’t hesitate to take firm enforcement action.
“We recently announced a major market-wide review investigating the rapid growth in prepayment meter installations and potential breaches of licences driving it. We are clear that suppliers must work hard to look after their customers at this time, especially those who are vulnerable, and the energy crisis must not be an excuse for unacceptable behaviour towards any customer – particularly those in vulnerable circumstances.”
Arvato Financial Solutions has been contacted for comment.
Hundreds of thousands of customers have been switched over to more costly prepayment meters, often unwillingly and without the offer of support, after failing to keep up with rising energy payments.
Some have found their smart meters switched to prepayment mode remotely while others have been confronted at their door by teams sent by energy companies – armed with magistrates’ court warrants – to physically make the change.
Just last week, Ofgem said it is to review the checks and balances that energy firms have around placing customers on pre-payment meters, warning it will take further legal action if it finds they are not taking due care.
In a blog, the watchdog’s chief executive, Jonathan Brearley, said he is concerned about the “sharp growth in households struggling to pay their bills being switched over to pre-payment meters, sometimes without their even knowing about it, leaving them without heating”.
It followed Business Secretary Grant Shapps’ demand that energy suppliers stop forcing financially-stretched households to switch to pre-payment meters.
He also vowed to “name and shame” the worst offenders.
Mr Brearley wrote: “The numbers of forced installation of pre-payment meters is extremely high. It is simply not acceptable that vulnerable customers are left in the dark and cold in winter.
“This review will focus specifically on self-disconnections, remote switching and forced installations, and the checks and balances companies have around any decision to put a customer on a pre-payment meter.
“If we find that they have not taken due care in this process, we will take further legal action against them.”
Campaigners say those switched often then go without power as they cannot afford to keep the meter topped up – something that is referred to as “self-disconnection”.
It comes after energy bills have soared due to rampant inflation and the impact of Russia’s invasion of Ukraine.
Simon Francis, co-ordinator of the End Fuel Poverty Coalition, said: “Ministers have fallen for the energy industry’s spin that they don’t use court warrants to install pre-payment meters on vulnerable customers.
“The investigation reveals this not to be the case.
“It is time that the Government stood up to energy firms and banned the forced installation of pre-payment meters and the forced switching of smart meters to pre-payment mode.
“We also now need a formal inquiry into the pre-payment meters scandal and the role of the courts in enabling this practice.”
