Ignoring the big issues like their lying, cheating and dishonesty one of the things that continuously puzzles, frustrates and annoys me about this country and our administration is why they make everything so complicated* when there is a very easy simple route.
This has happened yet again with Cameron announcing that everyone should be automatically put on the cheapest energy tariff. Yes, we all know that one of the biggest problems with energy prices is government intervention and taxation, but just assuming a better tariff would help why should this be a problem?
It’s very easy. At the end of the financial year, or yearly at some convenient date, the energy company calculates what a consumer’s bill would have been had they been on the cheapest tariff for that period. If this is less than the amount actually charged the energy company credits back the difference to the customer. Not perfect perhaps but simple!
Over a few years it would immediately be obvious by comparing average bills, which company was overall most efficient and averaged lower payments, that would guide people to changing companies.
Not only would it work with energy it could be applied to phone tariffs. How many people are fed up with trying to predict their usage in advance and pick the best deal? And more importantly how many, as with energy, get it wrong and end up paying way over the odds?
*Of course we know don’t we. Even Ofgem has given the game away commenting that it would reduce competition. The price complication and tariff jungle and impossibility of advance knowledge is needed precisely and exactly to ensure that nobody can easily pick their best tariff or supply company in advance. That’s not open competition it’s sharp practice which disguises taxes, profits and inefficiencies, we would be better off without such so-called competition.
We could go even better by having two part gas bills. One part would be the energy company charges for infrastucture, taxes and overheads, the second part would be the raw international spot price for gas which would be passed on directly on at that price.