Reported by The Guardian
Exclusive: Ofgem to be given powers to issue fines and rein in bonuses for executives who ‘reward themselves while customers suffer’
Energy bosses in the UK will have their bonuses curtailed when suppliers and brokers break the rules under a crackdown on mis-selling.
Through the energy independence bill, which will be introduced on Wednesday, Ofgem will be given new powers to order compensation, impose fines and ban rogue operators that have pushed businesses and households into overpriced contracts.
More from the original report
Companies with a business energy supply contract often use a broker to secure their deal, but – unlike the intermediaries who market mortgages or insurance deals – these energy middlemen are largely unregulated.
The government said rogue brokers had been able to push small businesses into overpriced energy contracts while pocketing hidden commissions, leaving companies paying more than they should.
These energy brokers and price comparison services will now be brought under Ofgem’s remit. The move is expected to save businesses more than £100m a year from hidden commissions and mis-selling.
The watchdog will also be given powers to crack down on payments to bosses who have “rewarded themselves while customers suffer”.
It follows public outrage over huge bonus payouts to executives despite investigations into the treatment of vulnerable customers .
The energy secretary, Miatta Fahnbulleh , said: “People work hard for their money. They shouldn’t be ripped off by energy companies or forced to fight for fair treatment when things go wrong.
“When energy bosses fail their customers, they shouldn’t be walking away with bumper bonuses while families and businesses pick up the bill.”
The bill, which was announced in the king’s speech and is expected to set out more details on the government’s plans to transition to clean energy, comes as ministers face criticism over the green agenda.
John Healey recently unveiled more than £3bn of cuts to the energy department’s budget, much of which will pay for higher defence spending.
The chancellor also said he would veto new offshore wind projects if they did not lower bills, adding to concerns that the government was moving away from the pro-renewables…