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televisionThe Fair Trading Commission (FTC) is taking action to protect consumers from excessive retroactive billing by utility providers.
The regulator plans to implement a retrospective billing policy governing the operations of Barbados Electricity Company, Barbados Water Authority and Cable & Wireless (Barbados) Limited.
“Accordingly, the commission is seeking public comment because it will help determine when the policy applies, the time period over which utilities are permitted to bill retroactively, and the types of remedies available,” said FTC CEO Marsha Atherley-Ikechi, who said written comments from interested parties would be considered.
Retroactive billing, also commonly referred to as retroactive billing or back-pay billing, is a billing method used by utility companies that charges customers for periods of consumption that were previously unbilled or erroneously billed.
The CEO explained that this is different from the amount owed on a customer’s account due to non-payment.
She noted that retroactive billing can be used to correct previous billing anomalies. For example, when a billing error is discovered, the utility company will bill the customer to make up the difference between what was previously billed and what should have been billed.
“If a customer has previously underpaid for electricity, then they are in debt to the utility, and if a customer has previously overpaid for electricity, then they are eligible for a refund.”
Federal Trade Commission executives warned of the impact on consumers and utility companies.
While billing errors can be corrected, the CEO said backdating could result in customers being “long in arrears, owing large amounts” and facing a “pay now or have their power disconnected”. This could adversely affect vulnerable people and cause mental distress.
For businesses, especially small businesses, a large number of retroactive expenses can disrupt cash flow management.
Instead, the regulator said utilities risked “significant amounts of receivables” if they were unable to collect the money they were owed retroactively.
“In order to be fair to all customers and utilities, the Commission believes it is prudent to develop a policy to regulate retroactive billing for electricity, telecommunications, water and sewer,” Atherley-Ikechi announced.
The proposed policy will outline the rights and responsibilities of customers and utilities. It will set out the permitted lookback periods and conditions. The regulator invites stakeholders (governments, NGOs, utilities and customers) to provide feedback by June 26.
emmanueljoseph@barbadostoday.bb
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