Regulation is something which is important to protect customers and businesses, the CEO of energy broker Utility Aid is passionate about this being implemented. Following the failure of North Tyneside utility broker Utilitywise, Utility Aid is strengthening its calls for the immediate regulation of the energy industry. Utilitywise struggled after the introduction of IFRS15 in 2017 — an accounting reporting standard to stop over-optimistic executives booking guesstimate income from contracts ahead of costs, a practice rife in the industry.
Utility Aid, the UK’s leading national utility broker, is lobbying suppliers – including a number of the Big Six – to operate in a de facto regulatory manner until actual regulation is in place.
Giles Hankinson, CEO of Utility Aid, commented: “The management of Utilitywise cultivated unhealthy sales practices within the business. A culture of greed developed, whereby salespeople were disproportionately incentivised for loading huge commissions onto customer contracts. Similarly, sales staff were rewarded for signing customers into the longest possible contracts, completely disregarding market sentiment.
“The lack of regulation led to a breeding ground of poor practice, whereby having witnessed the cash rewards available, staff left to set up their own brokerages, migrating the poor practices with them.
“Our evidence suggests that the greed culture created by the management of Utilitywise and others has permeated into the culture of many other brokerages across the country. It is seemingly like the Wild West in the energy sector and the only thing that will bring it to a halt will be regulation.
“Right now, how much a business pays for their utilities is a gamble. Utility Aid primarily works in the not-for-profit sector, and I see every day what getting the best deal means for these organisations. Every single penny they save is reinvested into their front-line services, supporting people in our society that need it most.”
Hankinson warns that lack of regulation allows complete freedom of behaviour, with no legal recourse, for those suppliers or energy brokers not acting in the best interest of their clients.
He added: “The big energy companies and unscrupulous energy brokers are, in our opinion, opposing regulation because they are more concerned with maximising profits. Regulation would bring financial benefit and legal protection to tens of thousands of businesses and organisations.”
Utility Aid scooped ‘The Most Trusted Consultancy of the Year’ at the 2018 annual Energy Live Consultancy Awards.
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