Ad
Ad
Ad
Tag

BISCHOFF

Browsing

[ad_1]

Stamp out price hikes: Firms that exploit customers now are unlikely to hold onto them for long, says VICTORIA BISCHOFF










No one enjoys haggling more than yours truly.

As consumer group Which? pointed out this week, you can make serious savings by ‘making a nuisance of yourself’. And, as my husband will attest, this is something I’m rather good at.

But even hardened hagglers like me become weary in the face of nonsensical pricing decisions.

Cost of living crisis: With bills soaring, firms should be going out of their way to ensure households are not paying more than they need

Cost of living crisis: With bills soaring, firms should be going out of their way to ensure households are not paying more than they need

Take my car insurance renewal premium, which crept up by £17.26 this year. A quick look on comparison websites revealed there were identical deals available for far less than I paid in 2021.

When I called my existing provider to ask if it could match the price, I was immediately offered a ‘loyalty discount’ of £26.05.

Could it go further? Bingo — another £10 saving. Any more, I persevered? Success!

The third discount was slightly more complicated as it involved bundling in a month’s worth of home cover, but resulted in a further £31.59 off.

That’s a (very welcome) total saving of £67.64. But what a waste of everyone’s time. And as we report, it’s not just insurers forcing customers to fight for a fair price.

Money Mail Reporter Amelia Murray has discovered that telecoms giants are offering a secret discount to customers who call to negotiate a new deal.

Given so many companies are now reserving their cheapest offers for those who manage their accounts online, it’s no wonder people are confused.

With bills soaring, firms should be going out of their way to ensure households are not paying more than they need to. 

Yet, as is so often the case, they instead try to sneak through higher prices in the hope customers don’t notice they are missing out on vital savings. And this brings me to my next major bugbear.

Why are broadband and phone providers allowed to hike prices mid-way through a contract?

After all, if you lock into a fixed mortgage or energy tariff, the price remains the same for the duration of the deal.

We’re not talking about a modest rise, either. The clauses woven into their small print mean they can hike prices each year by inflation plus close to 4 per cent.

Many mobile giants even go a step further by using an outdated — and ultimately more costly — measure of inflation to determine increases. 

This means millions of households now face bill hikes of 10 per cent or more. It truly beggars belief.

If a tiny supplier in East Yorkshire can cancel its price increase to avoid burdening struggling households further, why can’t the likes of BT and Vodafone?

The top bosses would do well to remember that customers have a long memory. Exploit them now when times are hard and it is unlikely they’ll stick around later.

Counter argument

So much for ‘declining footfall’ in bank branches.

My local HSBC bank was packed when I visited to drop off some Christmas cash the other week, with some 30 customers in and out in the 15 minutes I was there.

But, my goodness, what a faff! The supposedly convenient self-service machines no longer accept First Direct bank cards as they have not been upgraded after the HSBC-backed telephone bank switched from Visa to Mastercard.

Customers can still deposit cheques and cash at the counter. But, as we reported last year, four in ten HSBC branches no longer offer counter services. 

First Direct says the issue should be fixed at some point ‘this year’ — but wouldn’t it have been more sensible to resolve the glitch before rolling out new cards?

No-spend trend

After boasting of my New Year Resolution success last week, I must now confess a failure.

Number nine on my list of ten money-saving goals for this year was to commit to one spend-free week in January. I won’t make excuses for my pathetic efforts (or midweek Mocha addiction).

But our ‘no-spend trend’ feature has inspired me to try again next month.

The winner is…

A huge thank you to everyone who voted in our revamped Wooden Spoon awards last month. 

The sheer number of entries we received speaks volumes about the sorry state of customer service today. We will unmask the unfortunate winner next week.

moneymail@dailymail.co.uk

Advertisement



[ad_2]

[ad_1]

For years, it has been abundantly clear this country’s child benefit scheme isn’t fit for purpose.

To start with, there is an ill-thought-out cap that is fundamentally unfair. It means couples with a joint income of £98,000 can claim the perk.

Yet families where one person earns £60,000 get nothing — even if they are a single parent or their partner doesn’t work.

Losing out: The taxman has been appalling at informing families how the tangled child benefit scheme system works

Losing out: The taxman has been appalling at informing families how the tangled child benefit scheme system works

The cap has also been frozen for nearly a decade, despite wage growth and rising inflation, which means more and more families are losing this vital support.

Then there is the fiendishly complicated way that the scheme is administered.

Those who earn between £50,000 and £60,000 are only entitled to part of the benefit — and so must repay some via the not-so-catchily-named High Income Child Benefit tax charge, or HICBC. This involves the often tedious task of filling in a self-assessment tax return.

And even families where one person earns more than the cap are not always able to simply opt out of receiving the payments.

This is because in cases where one partner does not work, continuing to claim child benefit allows them to accrue national insurance credits which will count towards their state pension.

But again, this money must then be repaid via self-assessment.

To make matters worse, the taxman has been appalling at informing families how the tangled system works.

Relying on leaflets handed out in maternity wards and an assumption that everyone reads the newspapers is just asking for trouble.

So is it any wonder that hundreds of thousands of parents have ended up making costly mistakes? 

And because HM Revenue & Customs (HMRC) has been so slow to pick up on these errors, many have then been landed with shock bills dating back years, along with colossal fines.

It has now emerged that the tax office has been given the legal authority to examine the financial records of 170,000 families that it believes wrongly claimed the benefit.

Such powers are usually reserved for investigating the most grievous tax offences, rather than hounding struggling families.

Yes, parents who are not eligible for the support must repay what they owe, otherwise it is not fair on those who did the right thing.

But is it really necessary to use such heavy-handed tactics, when many may have had no idea they’d overclaimed?

A thorough overhaul of this broken system is long overdue.

Meanwhile, as we report, HMRC might want to consider diverting a little more attention to raising awareness of the nearly £3 billion of tax-free childcare support parents are missing out on — not to mention the millions of child trust funds that have never been claimed.

Not again, Klarna

Buy-now-pay-later firm Klarna was forced to issue a grovelling apology last week after encouraging customers to cheer themselves up by going on a debt-funded shopping spree.

‘Stuck in a post-Christmas rut? Or perhaps you’ve got the January blues? Don’t fret — we’ve got some new and excited retailers guaranteed to put a spring in your step,’ the newsletter read.

With household bills soaring and tax hikes around the corner, it’s an incredibly irresponsible message.

And while Klarna has said it is investigating the gaffe, it is worth pointing out this is not its first offence.

In December 2020, Money Mail revealed that Klarna was being investigated by the advertising watchdog after it paid glamorous social media stars to promote buy-now-pay-later credit as a way to feel better in the pandemic.

The sooner these firms are regulated, the better.

Bargain hunt

Regular readers may remember that my final column of last year featured ten money-saving resolutions for 2022.

Number two was to be ultra-organised and buy Christmas paraphernalia in the January sales. Consider it done.

Bumper rolls of festive wrapping paper are going for 20p a pop in M&S — down from £6. And I’d thought my 74p gift tags from WH Smith were a bargain!

Just nine resolutions to go . . .

v.bischoff@dailymail.co.uk

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.

[ad_2]

[ad_1]

Supplier’s cold comfort: Vulnerable households need accurate energy bills not exercise tips, says VICTORIA BISCHOFF










Oh dear Ovo. The nation is facing an energy crisis that could cause the average bill to sky-rocket to an alarming £2,000 a year.

More than two dozen power firms have gone bust, and ministers are frantically poring over ways they could cushion the blow of looming price hikes, such as removing VAT on bills, boosting winter fuel payments and delaying tax rises.

Without urgent intervention, millions of vulnerable households could be forced to make the devastating choice between buying food and heating their homes.

So it is mind-boggling that a major supplier could be so detached from reality to think it appropriate to send customers an email with ‘simple’ energy-saving tips such as having ‘a cuddle with your pets and loved ones’, eating ‘hearty bowls of porridge’ and ‘doing a few star jumps’.

Feeling the heat: Complaints about energy suppliers are at a record-high and it is evident some billing systems are just not fit for purpose

Feeling the heat: Complaints about energy suppliers are at a record-high and it is evident some billing systems are just not fit for purpose

A spokesman for Ovo Energy has since apologised for its poor judgment. But its embarrassing error should serve as a wake-up call to all energy suppliers. 

As we report, the way many firms treat their customers is nothing short of a disgrace. Complaints are at a record high and it’s clear some billing systems are just not fit for purpose.

Companies may not be able to control wholesale prices. But, given customers are worried sick about how they will afford their bills this winter, firms could at the very least ensure the demands they dish out are correct.

Instead, time and again, we hear from readers who have been hit with shock statements wrongly claiming they owe hundreds or even thousands of pounds.

And when they try to challenge these, they are forced to spend months chasing to get the mistakes fixed. 

Even customers with smart meters — which were supposed to guarantee that you only pay for the power you use — are struggling to get accurate bills.

Many of these errors pre-date the current crisis. So it’s high time that energy watchdog Ofgem investigated the issue of shambolic customer service in this industry.

In the meantime, firms must make sure customers receive monthly statements so they can avoid racking up large debts.

Investment fears

Ouch. My investment portfolio has taken a battering since the start of the year, after several technology-heavy funds plummeted in value. 

Worried that I was over-exposed, I used Hargreaves Lansdown’s handy ‘portfolio analysis’ tool to get an exact breakdown of where my savings were invested.

The pie chart results suggest my money is nicely diversified among different sectors and countries.

So, for now, I am doing my best to ignore the alarming red minus numbers and will stick to my regular investing strategy in the hope that my funds bounce back.

To panic and sell now will only result in real cash losses. But this has served as a prudent reminder of the risk of being too invested in any one industry.

Some investment portfolios have taken a battering since the start of the year, after several technology-heavy funds plummeted in value

Some investment portfolios have taken a battering since the start of the year, after several technology-heavy funds plummeted in value

Premium palaver

It has taken weeks of listening to tedious hold music to get through to Esure to update my card details and challenge my home insurance renewal quote.

For the first time ever, my premium had actually gone down — by an unimpressive £2.86. 

But a quick search online suggested there were better bargains to be had. A spokesman for Esure says more than a fifth of its staff are on sick leave, which is why call waiting times are longer than usual.

Yet, as no one picked up until after January 1 — when rules were introduced to stop insurers offering cheaper deals to new customers — it meant I lost much of my haggling power. With just two days to go until my policy expired, I had little choice but to stay put.

I’d be interested to hear if any readers have bartered down their car or home insurance premiums since the New Year. Write to me at the email address below.

Mixed blessings

Finally, a hearty pat on the back to Virgin Media O2 for being the only major mobile provider not to bring back costly roaming charges for customers travelling in the European Union.

If only the firm would stop charging home movers unfair exit fees of up to £240 if they cannot get its broadband service at their new property, too.

v.bischoff@dailymail.co.uk

Advertisement



[ad_2]