There are terms and conditions in place for every broker, consultant, and supplier.
But what happens if these terms and conditions are breached, costing your company money and time?
Ofgem has been working to make micro-business customers’ experiences better by offering them fairer pricing and putting together a scheme that will protect them.
Back in 2021, Ofgem conducted the “Micro-business Strategic Review,” which included a request for evidence and a statutory consultation, as part of their efforts over the previous 18 months.
This is how, along with Ombudsman Services, they put in place an Alternative Dispute Resolution scheme for energy brokers to join.
Energy suppliers will now only be permitted to work with brokers—also referred to as “third party intermediaries”—who are participants of a qualifying alternative dispute resolution scheme.
Who are Ombudsman Services?
Ombudsman Services has been providing independent dispute resolution services across the energy, communication and parking sectors since 2002.
The company has been working alongside Ofgem during the review process to build the scheme, to gain a better understanding of the types of disputes that commonly occur between brokers and micro-businesses, and the challenges of operating in the space.
Ombudsman Services is governed by a number of main bodies who oversee their work to ensure they remain impartial. They aren’t a watchdog or a regulator – as their job is to resolve complaints in order to put consumers back into the position they were in before the issue occurred. They also specialise in working with businesses to better understand their customers, so they can serve them better and resolve problems faster.
How will the Alternative Dispute Resolution scheme work?
They have agreed a four-phase timeline with Ofgem as follows:
- 26th April – 31st August: Registration window for brokers opens[Text Wrapping Break]
- October: Confirmation of acceptance to the scheme and invoicing[Text Wrapping Break]
- November: Brokers added to the scheme register[Text Wrapping Break]
- 1st December: Scheme goes live.[Text Wrapping Break]
It’s important that energy brokers sign up to the scheme as soon as possible to avoid any possible delays impacting their ability to sell energy contracts on behalf of energy suppliers.
Why should brokers join?
Being registered to the scheme will enable brokers to continue selling energy contracts to suppliers’ microbusiness customers. Ombudsman Services will provide an impartial dispute resolution service and use their insight to help brokers to improve their service, processes and customer experience. They will also continue to work more broadly to inform policy and address industry-wide issues for the benefit of all.
The Alternative Dispute Resolution process enables your business to resolve a dispute it may be having with a customer, without having to go to court, and as it stands, 64% of disputes have been settled without the need of litigation saving both time, resource, and expense for both sides.
What do I need to register?
The Deed Poll form must be completed, and a copy of your Complaints handling system must be provided (CHP). The current yearly membership price is £300 per member, plus there are case-specific expenses.
Ombudsman Services has set up a dedicated team to answer any questions and provide support around registering for the service.
How do you register?
The registration form is available on the website of the Ombudsman. The website has footage of the Ombudsman’s sessions as well as frequently asked questions and guides.
What does Niccolo do to help?
While we don’t offer direct assistance, we are here to refer people who need help.
What do companies like PreAction Limited do?
Leading provider of alternative dispute resolution services, PreAction supports both SME and corporate clients across a range of industries in the UK and ROI.
PreAction is the only business in the UK that provides energy brokers with professional dispute resolution alternatives. It is estimated that the sector loses over £500,000,000 owing to consumer contract defaults with more than 2000 brokers.
PreAction collaborates with many different industries, but it presents itself as an expert in the energy brokering industry, offering a variety of services.
They mainly recover the financial loss from the customer and retains a percentage of the collected revenue.