Dealing with Utility Debt
Credit and Collections for European Utilities
London, September 2005
Susan Jordan
Managing Director, Charis Ltd
Utilities debt…who cares
It pays to care about vulnerable customers:
• for moral reasons
• regulatory reasons
• for business reasons – bad debt is in no one’s best
interest
• for PR reasons
• as part of CSR imperatives.
Is there a better way
• For a minority of customers, conventional
methods of billing and collections don’t work.
• Some vulnerable users simply can’t afford to pay.
• Progressive utility companies have established
charitable trusts to help in these cases.
Trusts – what are the benefits
• Trusts demonstrate proactive CSR.
• Trusts clear otherwise irrecoverable debts.
• Trusts help identify vulnerable customers.
• Trusts reduce costs of collection.
• Trusts help some vulnerable customers get back
on track.
Future improvements
• Free and impartial Money Advice Services.
• Money management education projects
• Grant-makers who understand the voluntary
sector as well as the business drivers
• Strategic giving = greater impact
Introducing the Charis Trusts…
• Anglian Water Trust Fund
including Three Valleys Water, Cambridge Water
• British Gas Energy Trust & Scottish Gas Energy Trust
• EDF Energy Trust
London Energy, Seeboard Energy, SWEB Energy and EDF Energy
• Eos Foundation
Bournemouth & West Hampshire Water, Folkestone & Dover Water,
Mid Kent Water, Portsmouth Water, South East Water,
Tendring Hundred Water
Aim of the Trusts
• Immediate: €6.6m (£4.5m) pa to help
beneficiaries achieve financial stability wherever
possible or to make quality of life payments
• Future: €2.2m (£1.5m) pa debt prevention work –
money management education for adults and
young people
Shared programme of giving
Benefits individuals and families in need
through:
• ease of access – one application form to access
all funds held by Charis Grants
• economies of scale
• accumulative impact.
Application debtload
Application debtload
Further breakdown of ‘Other Debt’
During the week…
• Northumbrian Water • Southern Water
• Npower • South West Water
• Powergen • Telecoms
• Scottish Power • Thames Water
• Scottish and Southern • United Utilities Water
Electric • Wessex Water
• Severn Trent Water
• South Staffs Water
Total: £28k
Water or Fuel Poor
• 60 – 70% of applicants were water and / or fuel
poor (not necessarily the same people)
• paying over 3% of income for water charges
• over 10% of income for fuel charges
• 30 – 40% of applicants were vulnerable for other
reasons
Charis Grants
• a social enterprise delivering charitable grants on
behalf of boards of trustees
• a wealth of experience of vulnerability and the
voluntary sector
• understands the challenges faced by all utilities
when dealing with vulnerable customers
www.charisgrants.com email admin@charisgrants.com
Charis Ltd
• consultancy services
helping companies create effective mechanisms for supporting
vulnerable people
• training provider
design and delivery of courses that develop company staff and
policy-making
Together providing services for…
• Anglian Water
• Bournemouth & West Hampshire Water
• British Gas and Scottish Gas
• Cambridge Water
• EDF Energy, London Energy, Seeboard Energy, SWEB Energy
• Folkestone & Dover Water
• KPMG
• Mid Kent Water
• Npower
• Portsmouth Water
• South East Water
• Tendring Hundred Water
• Three Valleys Water
Warm words…
…this young person can now begin to
evaluate her future. She is keeping to her
budgeting programme and is applying for
training/work experience. It is hoped that
she will soon be ready to go on to
independent living – with your help.
Supported Housing Project Worker,
Norwich
Warm words
Your organisation has helped restore
my faith in humanity – all I can say is
thank you and we really do appreciate
your charitable work.
An applicant from Norfolk
Warm words
I truly appreciate the help your organisation
has given to me and my children. It is good
to know that someone cares enough in this
world to help us. We have been through
some very hard times in the last couple of
years. I only wish there was some way I
could repay you.
An applicant from Cambridge