Following concerns over poor practice, Ofgem instructed energy suppliers to pause involuntary installations of prepayment meters to manage consumer debt last year. A nationwide market compliance review followed, leading to a revised Code of Practice (CoP) that emphasised protection for vulnerable customers.
Moorhouse was engaged with energy suppliers, conducting independent market compliance reviews relating to the installation of prepayment meters under warrant and enforced remote mode switching.
Over the last year, Moorhouse has additionally worked with suppliers to support the design and implementation of new CoP-impacted processes, learning and development programmes, as well as compliance assessments of people, processes and systems against the regulations outlined in the CoP that are now part of the supply licence.
We have supported and enabled our supplier clients to review and consider their respective regulatory compliance positions, to identify opportunities for improvement and to mitigate risks, as well as put them in better positions to identify vulnerabilities.
Importantly, this also allowed suppliers to assess and review how they offer support to vulnerable customers and ways in which consumer debt, using data and enhanced processes, could be identified, recognised and even prevented.
What was the challenge?
To restart involuntary prepayment installations, Ofgem required energy suppliers to adhere to the Prepayment CoP. In April last year, Ofgem enforced a series of new measures to enhance the protections for vulnerable consumers, whilst also allowing suppliers to exercise their statutory right to recover debt.
The regulatory changes coupled with the scale of customer debt challenges put suppliers under a significant amount of pressure on their already limited resources and operations as they worked to prioritise consumer protection, alongside adherence to licence conditions, all whilst striving to deliver service to their customers, and operate at a profit in a complex and competitive market.
However, considering the significant affordability concerns and rising debt levels, suppliers continue to face an increased level of scrutiny from the media, government and Ofgem to ensure their decision-making does not cause consumer harm.
How did we help?
Moorhouse conducted comprehensive market compliance reviews of energy suppliers’ existing processes, policies and systems, mapping against CoP requirements to assess compliance and identify areas of risk.
The assessments involved a review of relevant contractual documents for their third parties and the processes of each supplier and their field force services providers, as well as detailed account reviews. It also included series of interviews with stakeholders across the energy suppliers and their third parties.
Across our supplier clients, Moorhouse designed and supported the implementation of new CoP processes and controls across multiple consumer-facing teams and departments, whilst also providing delivery oversight to implement the CoP changes required across the energy suppliers and their third-party providers.
Working with these organisations, Moorhouse also undertook a full Learning Needs Analysis to understand the current training programme, existing mindset, and behaviours of the field force and back-office teams on the front line of warrant installations and remote mode change activity. Moorhouse led a collaboration exercise to identify and agree the expected to-be behaviours and skills of the field force, and outlined the interventions required to deliver a detailed training programme.
What was the impact?
Our work with suppliers helped to identify regulatory compliance as well as areas of good practice and uplifted other areas of potential risk for review and mitigation across activities that suppliers and their field force could carry out. This also included recommendations on ways to improve customer experience, especially for vulnerable customers, to offer early assistance and reduce the need for debt recovery via involuntary prepayment installations.
We provided suppliers with clear sets of actionable recommendations to improve protections of vulnerable customers, reduce the future risks of non-compliance and put in place monitoring controls and processes to support with ongoing quality assurance and continuous improvement.
Moorhouse supported clients navigate a variety of challenges through this prepayment CoP set of changes. This included the setting up and implementing of new processes and controls, the use of AI for data analysts, third-party contract and performance management, and learning, development people and processes as part of setting up new functions. All this activity supported uplifting processes, skills, and behaviours to support compliance with the new CoP and, more critically, to identify and protect vulnerable customers.
Moorhouse assured its clients’ processes to ensure they adhered to regulatory and legal requirements, ethical practices, and industry-specific guidelines, including those applied by third parties. Findings of Moorhouse’s reviews were presented to senior leaders as well as Ofgem to evidence compliance and as part of the process to obtain approval to restart operations in these areas.
How Moorhouse can help
At Moorhouse, we have extensive experience across energy retail regulation and policy, as well as consumer care, prepayment, and the debt pathway journey, and we understand the additional pressure that stringent regulations are placing on organisations’ already limited resources and operations.
Our retail and regulatory experts can help you navigate these risky and tricky areas and support improved confidence in how your people, processes and systems are set up from consumer care and regulatory compliance perspectives. This could range from a rapid discovery diagnostic to a regular audit of compliance through to designing a new operating model that makes the best use of prepayment and provide excellent customer care.
Please feel free to reach out to discuss how we can help you to proactively address any regulatory concerns whilst implementing and maintaining best practices.
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