Energy firms face deadline in review of direct debit hikes

SOME energy suppliers have been given a three-week deadline to explain accusations they have increased customers’ direct debit payments by “more than is necessary”.

Jonathan Brearley, boss of the energy regulator Ofgem, recently said there were “troubling signs” of the tactic.

He also expressed concern over customers being directed to inappropriate deals.

Official reviews have now been launched.

Mr Brearley had said in April that reviews were imminent, but the development emerged from an update published on Twitter by Business Secretary Kwasi Kwarteng.

Mr Kwarteng said that some energy companies had been increasing direct debits beyond what was required.

“I can confirm Ofgem has today issued compliance reviews,” Mr Kwarteng’s tweet went on.

“The regulator will not hesitate to swiftly enforce compliance, including issuing substantial fines.”

However, by reviewing the issue, Ofgem has yet to draw a firm conclusion on whether any rules have been broken.

Prime Minister Boris Johnson had earlier acknowledged “there is more that we can do” to help families struggling with rising fuel and energy bills.

Opposition parties have called for a windfall tax on energy company profits, with Labour accusing him of offering “no answers” to a “cost of living crisis”.