MPs call for compensation after consumers miss out on cheapest switch deals
The Energy and Climate Change Committee has called for price comparison sites to pay compensation to energy consumers who switched to packages that were not the cheapest available at the time.
The committee's MPs also want industry regulator Ofgem to look at whether such sites should be required to reveal how much commission they are making on each switch.
"Consumers trust price comparison services to help them switch to the best energy deals available on the market. But some energy price comparison sites have been behaving more like backstreet market traders than the trustworthy consumer champions they make themselves out to be in adverts on TV," said the committee's chair, Tim Yeo.
"As an immediate and essential first step towards rebuilding confidence, the companies should compensate any consumers who have been encouraged to switch to tariffs that may not have been the cheapest or most appropriate for their needs."
The group of MPs believe the voluntary Consumer Code currently in place "does not provide adequate protection" for consumers, who it added were largely unaware of the code's existence.
The committee wants Ofgem to look into whether a licence-based system would be more suitable.
Yeo continued: "The current hands-off approach is clearly not working and the lack of contrition from some companies even when faced with proof that they misled customers has convinced us that some form of licensing of energy price comparison sites may be needed.
"If the government wants more people to switch energy supplier then it has to ensure that energy price comparison services are transparent and trusted."