ScottishPower to pay £18m over customer service failings

Energy firm ScottishPower is to pay out £18 million following a probe by industry regulator Ofgem into its customer service standards.

Ofgem said ScottishPower customers faced 'unacceptably long call waiting times'. Picture: Andrew Milligan/PA

The Glasgow-based utility “failed to treat its customers fairly” when handling calls, dealing with complaints and billing, the watchdog said.

Ofgem chief executive Dermot Nolan said: “ScottishPower let its customers down during the implementation of a new IT system. When things went wrong, it didn’t act quickly enough to fix them.

“This created frustration and worry for many customers, who also wasted a lot of time trying to contact the supplier by phone.”

ScottishPower was blasted for “unacceptably long call waiting times”, with the company receiving more than one million complaints between June 2013 and December 2015.

Ofgem added that thousands of ombudsman rulings were not implemented within the required 28 days and ScottishPower’s failures resulted in more than 300,000 customers receiving late final bills. This meant many customers did not receive money they were owed.

However, the regulator also said that, since it opened the investigation, ScottishPower has improved its customer service.

Up to £15m will be paid out to “vulnerable” ScottishPower customers affected by customer service issues and the remainder will go to charity.

Neil Clitheroe, ScottishPower’s chief executive of energy retail and generation, said the group apologised “unreservedly” to affected customers.

He added: “In order to upgrade our old IT systems, we invested £200m on new technology to allow us to deliver smarter digital products and services to benefit our customers. During the complex transition between systems we encountered a range of technical issues. This lead to an unacceptable increase in complaints and reduced the quality of our customer service.

“I gave a guarantee that no customer would be left out of pocket by these issues and we continue to compensate customers who have been affected. Additional customer service advisors were added and we extended our opening hours to the longest in the industry in order to improve our customer service levels.

“With our new IT system now fully in place, our service performance has significantly improved and customers will start to see real benefits in managing their accounts. Newly developed digital services have been launched, such as online payment adjustments and refunds, which would not have been possible on our old system.

“We know we need to do more and we will continue to work hard to deliver further improvements, and ensure that our customer service standards return to being amongst the best in the industry.”