British Gas Business to pay £9.5 million for customer service failings

Press release

Publication date

Industry sector

Supply and Retail Market
  • British Gas Business let customers down when it implemented a new IT billing system in 2014.
  • Accurate bills weren’t issued on time, new customers experienced delays registering and complaints weren’t properly handled
  • British Gas Business did the right thing by self-reporting the issues to Ofgem

British Gas Business is to pay £9.5 million, following failings in its registrations, complaints handling and billing processes for business customers.

When British Gas Business implemented a new IT billing system in March 2014, tens of thousands of its business customers were left with delayed and inaccurate bills. Over 6,000 new customers experienced delays registering with the supplier.

As a consequence, the number of complaints the supplier received significantly increased. Many were handled poorly or not on time. 

British Gas Business came forward to Ofgem voluntarily to report the problems in December 2014.

Ofgem investigated and found that the supplier had failed to treat these business customers fairly. It didn’t do enough to protect affected customers from issues that arose from the implementation of its new IT billing system. This included making sure that its customer service processes were adequate, and that it had allocated enough staff to deal with complaints.

After initial problems emerged, British Gas Business compensated some affected customers, acted to reduce levels of delayed bills and contacted customers to explain problems with the billing system. The supplier allowed some customers to switch despite being in debt, if that debt was related to its failure to produce a bill.

British Gas Business has since improved its service for affected business customers. It has taken action to put right its customer service processes, hiring up to 350 specialist agents to help handle increased call volumes and a backlog of open complaints. It has also significantly improved its performance on billing and customer registrations. 

British Gas Business has agreed to pay £9.5 million in redress. This includes direct payments to affected micro-business customers, and payments to the charity the Money Advice Trust (which provides the Business Debtline service) to help energy consumers in need. 

Ofgem’s CEO Dermot Nolan comments: “British Gas Business has done the right thing by coming forward to Ofgem to report problems with its new IT billing system, and has since worked hard to improve its customer service. However, British Gas Business’ implementation did go wrong and it didn’t act quickly enough to put things right.

“Many existing businesses customers were left without accurate bills, causing significant concern. New customers were delayed from switching to the supplier, potentially costing them money by leaving them on a more expensive deal with another supplier.

“Ofgem welcomes suppliers investing in new systems and recognises that this can be challenging. However the £9.5 million payment also sends a strong reminder to all energy companies that they must treat consumers fairly at all times, including while new systems are put in place.”

Notes to editors

  1. Investigation into British Gas Trading Limited and its compliance with its obligations under the gas and electricity supply licences (Standard Licence Conditions 7A, 7B, 14, 14A and 21B)
  2. Background: 
    In October 2015, Ofgem launched the investigation into British Gas which we are concluding today. 
    The investigation covered these main areas, of which we found the supplier to be in breach:
    • SLC 7A - provision of contract end dates on bills for micro business customers;
    • SLC 14A - completing a supplier transfer within 21 days;
    • SLC 21B - frequency of billing;
    • SLC 7B - Standards of Conduct (SOC):
      • Poor customer service arrangements
      • Issues with inaccurate bills
      • Customers not contacted for extended periods of time
    • Complaints Handling Regulations (CHRs):
      • CHR 3(2) - adherence to complaints handling procedure
      • CHR 7(1)(a) – requirement to receive, handle and process complaints in an efficient and timely manner
      • CHR7(1)(b) - allocation and maintenance of sufficient resource for handling complaints
  3. British Gas Business: 
    British Gas Business supplies around 400,000 customers through more than 700,000 electricity and gas supply points. 
  4. British Gas Business will be contacting affected business customers directly.

About Ofgem

Ofgem is the independent energy regulator for Great Britain. Its priority is to make a positive difference for consumers by promoting competition in the energy markets and regulating networks.

For facts, figures and information about Ofgem’s work, see Energy facts and figures or visit the Ofgem Data Portal

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Further information for media

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