Call to police the way energy companies treat SMEs
The Forum of Private Business is calling for a code of conduct to police the way utilities companies treat small firms. In particular, it wants a cap on back billing and fairer contracts to prevent them from being rolled-over onto more expensive deals with little or no prior knowledge.
The FPB is working with Ofgem and the Energy Retailers Association (ERA) on guidelines to reduce the impact of back billing on micro businesses. These include, where a micro business has taken all reasonable steps to avoid being back billed requiring energy companies to limit retrospective charges to three years for electricity bills and to a negotiated period for gas bills.
The move comes after the forum’s latest quarterly Referendum survey showed 94% of respondents have seen energy bills increase over the past year, followed closely by rises in transport costs (92%) and increases in the price of raw materials (82%).
82% of respondents said that overall rising costs have impacted adversely on their business. More than half (55%) said they have impacted on staffing costs, and 74% reported that cost increases have inhibited their growth.
The study found overall business inflation is running at 8.5%, with micro businesses employing between five and nine staff experiencing an even greater rate of 11%.
“It’s no surprise that so many of our members are feeling the pinch when it comes to energy in particular. The situation doesn’t look set to change in the foreseeable future as all of the ‘big six’ suppliers have put utility prices up in time for the peak winter season,” said the FPB’s chief executive Phil Orford.