The pressure is causing huge stresses for some. “I felt embarrassed and ashamed and I didn’t want to speak to a financial counsellor because I could work it out but I knew I had better do what they said or my electricity would be cut off,” Ms McDonald said.
Since January 2020, 78 Alinta customers called the helpline, compared with 10 AGL customers, five Energy Australia customers and 25 Origin customers.
In a statement Alinta said after an initial review of both cases it was concerned that aspects of the customer interaction “do not align with our policy.”
Given financial counsellors are a free community service and in high demand and short supply it can sometimes take six to eight weeks to see someone, which makes it problematic for Alinta customers.
Alinta’s treatment of some of these customers is potentially in breach of the Energy Retail Code and the Essential Service Commission’s (ESC) energy compliance and enforcement policy, specifically the part relating to payment difficulties.
I felt embarrassed and ashamed … but I knew I had better do what they said or my electricity would be cut off.
It has resulted in a number of complaints being lodged to the regulator ESC and the Energy and Water Ombudsman.
In one letter to the ESC, dated February 24, CALC says “We hope the ESC can take action to ensure that Alinta is held to account for any breaches in this situation and to discourage the systemic issues with their conduct that we are seeing, particularly in relation to referrals to our services as a condition of assessing entitlements.”
Other states including Queensland and NSW have also noted a recent spike in the number of Alinta customers contacting financial counsellors for help.
Victorian-based financial counsellor Sarah Brown-Shaw likens it to Alinta outsourcing a core component of its business.
“A for profit company like Alinta needs to have discussions with their customers about payment plans instead of forcing them to speak to us, particularly when some of them don’t want to,” she said.
It was a sentiment echoed by Financial Counselling Australia boss Fiona Guthrie who said “financial counsellors are always really happy to take referrals from industry, but they need to be appropriate referrals. An energy retailer has an obligation to assess a customer’s request for hardship in the first instance, not outsource it. Inappropriate referrals just stretch already stretched community sector resources.”
A spokesman for the ESC said the regulator “takes seriously any breaches of our energy rules, including rules aimed at protecting customers experiencing payment difficulties. Energy companies found in breach of these rules will face potential enforcement action. We confirm that Consumer Action Law Centre has referred complaints to us and we are looking into it.”
CALC director of policy and campaigns, Katherine Temple, said a large proportion of people who contacted the National Debt Helpline on Alinta payment plans failed to meet them because they weren’t affordable in the first place.
“We have spoken to Alinta about the issue but have failed to see any genuine attempt to fix the situation,” she said.
Alinta said in a statement its hardship program was managed in Australia and delivered from the Philippines as part of a process established in May 2019.
It said industry statistics indicate that customers on hardship programs were at an all-time high, “which is a factor in our increased activity. Our expectation is for these trends to continue across the industry.” It said it encouraged people to get support and contact free financial counselling services “because we feel they have the expertise required to help”.
It said if CALC and Financial Counselling Australia were unable to continue providing these services it may require a whole of sector and government response and Alinta would be happy to participate.
“It is important that customers in hardship continue to receive this sort of support, so we do not have any plans to stop referring customers to community support services,” Alinta said.
It isn’t the first time Alinta has been in the regulator’s sights. In 2018 the energy company was fined $300,000 by the ESC for allegedly transferring customers without their consent.
The ESC will also commence an audit of Alinta Energy this month.
Other heavy handed tactics being looked at include the issuing of a bankruptcy notice to dairy farmers the White family who missed a $2000 payment on an electricity bill.
Alinta is also facing an inquiry by the Office of the Australian Information Commissioner, which regulates the Australian Privacy Act, on the back of a joint media investigation by The Age, Herald and ABC’s 7.30 which exposed gaping holes in how Alinta protects the personal information of its 1.1 million customers.
A series of Alinta documents leaked by a whistleblower show that almost three years after then-treasurer Scott Morrison approved the company’s sale to Chinese-owned Chow Tai Fook on advice from the Foreign Investment Review Board (FIRB), the company’s privacy systems remain inadequate.
One internal document said Alinta “may not be adequately protecting personal information” and at times “doesn’t meet the requirements of privacy laws”.
Since the takeover in 2017 Alinta has been aggressively signing up new customers, more recently signing up 1000 a day. It seems as customer numbers surged, so did complaints.
Adele Ferguson is a Gold Walkley Award winning investigative journalist. She reports and comments on companies, markets and the economy.