Martin Lewis Highlights Persistent Backbilling Issue
Martin Lewis has raised concerns about energy companies in the UK continuing to backbill customers for energy used more than 12 months ago, despite regulations from Ofgem that prohibit this practice. The money-saving expert told MPs that he regularly hears from people who have been billed for two years' worth of energy, even though rules should protect them.
Ofgem's 12-Month Backbilling Rule
Ofgem's rules state that domestic consumers and microbusinesses do not have to pay for energy used more than 12 months ago if they were not informed of the amount owed through a statement of account, if their Direct Debit was set too low, or if they had not received an accurate bill. However, Lewis noted that many consumers are unaware of these protections.
Speaking at the public accounts committee, Lewis said: "We have a host of problems over billing. Billing is incredibly complex, especially in the energy world. We have the issue that you cannot be backbilled for more than 12 months. I think Ofgem has been cracking down on that, but I am still regularly contacted by people who have had two years of backbilling."
Systemic Failures in Billing Systems
Lewis emphasized that the problem persists due to systemic issues within energy companies. He stated: "If you do not know that you cannot be backbilled for over a year, you do not know that you can say, 'I'm not paying for more than a year because it was your fault.' There are technical rules - if you have behaved wrongly, it doesn't apply - but, effectively, if they have not billed you for two years and it is their fault, they cannot bill you for longer than 12 months. But people do still get billed. One would surely think that in this modern digital world something is systemically going wrong in the companies in the way that we do this."
Advice for Consumers Facing Backbilling
According to Citizens Advice, suppliers cannot usually send a bill for energy used more than 12 months ago, unless the supplier sent a bill within that year and the consumer did not pay. The charity advises consumers to write to their supplier stating they are protected by backbilling rules and should only be charged for one year's energy use. If the supplier persists, consumers should lodge a complaint.
