SENIORS advocates are urging the Government to adopt Australian Competition and Consumer Commission’s electricity affordability recommendations, which would see an average household save between 20 and 25 per cent on their power bill (around $290-$415 per annum),
National Seniors Australia Chief Advocate Ian Henschke said the ACCC report had revealed the widespread abuse of market power by larger energy companies, which had affected vulnerable older Australians badly.
Spiraling costs
Spiraling electricity costs over the past decade was a significant concern for seniors, particularly those on low fixed incomes, he said.
National Seniors called for a default offer in its submission to the ACCC enquiry last year, because of insufficient trust in the standard retail alternatives.
“Older consumers have been reticent to take up offers in the past because they were wary of the implications," Mr Henschke said.
“In many instances, older consumers have found themselves worse off because the terms and conditions of market offers are confusing, misleading or difficult to compare.
“Access to a government default offer will also benefit those consumers unable to shop around for a market offer because of limited digital literacy.”
Mr Henschke said National Seniors also supported the ACCC recommendations to set a reference bill amount, from which retailers would apply any discounts, and to restrict conditional discounts such as pay-on-time offers.
Using the default offer to set the benchmark from which discounts were applied would ensure customers could clearly see if an alternative market offer was a better deal.
“This will stop retailers giving false discounts on inflated prices,” Mr Henschke said.
COTA Australia Chief Executive Ian Yates said the ACCC’s report included a series of important consumer focused recommendations that could reduce the cost of living pressures faced by older Australians.
“Energy prices are going up and up and older Australians, particularly retirees on age pensions, are struggling with the rising cost pressures forcing them to cut spending in other areas such as health.
“The ACCC report is a step in the right direction to ensuring the rights of older Australians in the electricity market are properly accounted for.
“Energy prices are going up and up and older Australians, particularly retirees on age pensions, are struggling with the rising cost pressures forcing them to cut spending in other areas such as health" - Ian Yates.
“The onus is now on the Government to quickly adopt the consumer-focused recommendations and to take decisive action in protecting and safeguarding the rights of older consumers,” Mr Yates said.
COTA has also welcomed the proposed nationally consistent mean-tested approach to concessions and the introduction of a hybrid fixed and percentage rate.
It also supports the ACCC’s recommendations to improve comparability of energy prices and that the Government invest energy literacy programs amongst vulnerable populations, including older consumers.
“Older Australians are bombarded with various electricity plans and often don’t know how to work out which plan is best for them – programs that ensure older Australians are equipped with the skills and resources to make an informed choice when it comes to their energy provider are greatly welcomed.
Market Broken
In a recent statement ACCC Chairman Rod Sims said the national electricity market was broken.
“It is clear that most households are paying far too much for electricity. In addition, some of the most vulnerable in our community are forced to struggle through freezing winters and scorching summers, with many others also having difficulty paying their bills,” Mr Sims said.