Dropsafe

by Alec Muffett

The Southern Electric Direct Debit Racket

Yes, Direct Debit is great when you hate paperwork, as I do; what’s not great is when the vendor takes a fixed amount per month that’s set too high.

Witness Southern Electric; they’ve been debiting me £70 per month for the past year or so, and I reckon that’s rather too high, so I sent in a meter reading and prepared to merge my gas and electric payments on a British Gas scheme for a year or so.

I phoned Southern Electric and – long story short – I’ve been averaging £47/month consumption, the six-monthly billing period runs Feb-August, and my credit with them is currently some £417.

It took several attempts to point out that the money in credit now would still far exceed any plausible bill that would arrive in August (“round 47 up to 50 and multiply by 6, that’s £300, and yet you currently have £417 and yet would still be debiting me for another 2 or 3 months”) … so they’re dropping my debit to £50/month and after banging on about mathematics for a few minutes are sending me a refund of the credit that remained after my previous bill – £137 – but it’s still not ideal. They’re basically holding hostage some £60 to £100 of mine, until I close my account with them.

So, I’m glad I’m switching, gives me a chance to draw a line under this nonsense.

Direct Debit is still the simplest and cheapest way to pay – but you have to watch the buggers in case they’re stockpiling your money.

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Comments

3 responses to “The Southern Electric Direct Debit Racket”

  1. Stephen Usher

    Unfortunately most, if not all, utility companies who use direct debit do the same sort of thing. OK, they’re not often as bad as your case but they do always set the figure in their favour so that there’s always a credit.

    Of course, this credit is not in some special place where they don’t get the benefit. Oh no. It’s used as capital that they can spend or invest. The customers are essentially lending the utility company interest free credit.

    This is why I still always pay my bills using a cheque at the bank (which means I get a proper receipt as well). I just don’t trust the b*stards.

    Reply
  2. Em

    Steve: Actually it can work the other way. I keep arguing with British Gas that the amount they keep setting for us is too low.

    The previous quarter I managed to successfully get them to increase it significantly so that we would actually be paying the amount that we were using. Success and the recent bill just tallied with our direct debit but not enough to cut how much we owe. Their response was to cut our direct debit amount significantly. I explained how if we’d left the previous value as it was the amount we paid wouldn’t even have tallied with the amount we used and we still owe them money. This time they refused to manually override the direct debit amount.

    I can’t understand how they set these values because they are always way off what we actually use.

    Reply
  3. dropsafe : Yet more on the #SouthernElectric Direct-Debit Racket

    […] is exactly what happened to me some time ago, and has now led to my abandonment of Southern […]

    Reply

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