What is the Formula that OVO use to work out the weekly repayment rates for Energy arrears when applying for Fuel Direct deductions?
I don’t wish to know the Formula that is on the Ofgem site, I specifically wish to know the formula that OVO use for this purpose.
Best answer by Abby_OVO
Updated on 10/02/25 by Ben_OVO
Hey
As mentioned by BPLightlog, there is no OVO Formula for working out Fuel Direct.
The DWP says that Fuel Direct is a last resort payment plan that is offered to customers when all other payment plan options have been exhausted.
If this is the only suitable plan after discussions with the customer then our agents will discuss the customers’ income and expenditure to see if Fuel Direct is a good option to them as they need to pay for their ongoing usage and the arrears that are set by the DWP.
Once the customer has been informed of the usage and arrears amount the customer should know if this would leave them with little or no money to live on, and our agents will work out if this exceeds 25% of their income. If the plan is agreed to on the call, the form will be forwarded onto the specialist team who work with the DWP, and even if we send the form to the DWP they will also check to see if this exceeds the 25% and either reject it or in some cases if it is only over by a small amount they would write to the customer to advise to gain there consent.
Customers are always welcome to pay additional payments on top of their account to clear the debt down faster by making card payments however we cannot request more than the set amount set by the DWP as they control that part.
I hope this helps to clear a few things up for you.
+5Hi
https://www.ovoenergy.com/help/article/debt-and-energy-assistance
+2I think
The DWP calculate a fixed amount and this goes to the supplier?
So those with larger debts take longer to pay off the debt via Fuel Direct payments?
Have you asked DWP how it works
Hiya,
Thanks for the reply. Yes, the DWP do administer the scheme; however, the supplier uses a standard form, supplied to them by Energy UK. It is for the supplier to tell the DWP within this form the amount being sought for deductions per week, as this amount will (normally) already have been agreed beforehand with the customer.
For instance, when the customer is speaking with the supplier to set up the deductions, the supplier will (in good practice) ask for the customers income.
The supplier, now having both the amount owing, and the customers income per week/month will use a formula to arrive at the rate of deductions per pay period. I believe the DWP pay the supplier once a month.
All suppliers would be expected to use some form of calculation to arrive at a repayment rate. As stated in the original post, I possess the Formula that they are meant to use. However, I’m wondering what formula OVO actually use.
The amount to be paid is agreed with the supplier before the application is made to the DWP. The DWP then pay this amount, they don’t actually calculate it themselves as this has already been done beforehand.
+2Hiya,
Thanks for the reply. Yes, the DWP do administer the scheme; however, the supplier uses a standard form, supplied to them by Energy UK. It is for the supplier to tell the DWP within this form the amount being sought for deductions per week, as this amount will (normally) already have been agreed beforehand with the customer.
For instance, when the customer is speaking with the supplier to set up the deductions, the supplier will (in good practice) ask for the customers income.
The supplier, now having both the amount owing, and the customers income per week/month will use a formula to arrive at the rate of deductions per pay period. I believe the DWP pay the supplier once a month.
All suppliers would be expected to use some form of calculation to arrive at a repayment rate. As stated in the original post, I possess the Formula that they are meant to use. However, I’m wondering what formula OVO actually use.
The amount to be paid is agreed with the supplier before the application is made to the DWP. The DWP then pay this amount, they don’t actually calculate it themselves as this has already been done beforehand.
Interesting, I didn't know there was a form, do you have a link to the one you mention from Energy UK.?
There are two parts of the scheme I understood, although I am no expert. This is from the DWP.
1. To pay off arrears.
2. To pay for ongoing usage.
You mentioned paying off arrears. So I will focus on that.
There is a minimum fixed amount that is taken to pay off arreas. DWP set this.
You can choose to pay off more but that isn't mandatory.
Did OVO make this clear? I would be curious to know if ovo gave you a choice to pay only the minimum amount. Are you voluntarily paying more via deductions?
Are you also voluntarily paying for ongoing usage via DWP defuctions? You have to give your concent for this, it is not mandatory.
A fixed amount is deducted from your benefits until you’ve paid off the debt you owe. Money can be deducted to pay off up to 3 debts at once.
If you receive Universal Credit, 5% will be deducted from your benefit payment for each debt you owe. For rent, between 10 and 20% will be deducted.
If you receive other benefits, £3.85 a week will be deducted for each debt.
If you want to pay more than the fixed rate towards your debts, you must arrange this with the organisation you owe money to."
. https://www.gov.uk/bills-benefits
Hiya,
The form itself, I do not have, but it is referred to in the section “How to Apply” in the following document:
“For income-based JSA, Income Support, Pension Credit and income-related ESA, use the form provided by Energy UK. https://www.gov.uk/government/publications/how-to-request-deductions-from-benefit-a-guide-for-creditors/third-party-deductions-from-benefits-a-guide-for-fuel-suppliers”
I did, however, find an application form for use by suppliers at https://www.ofgem.gov.uk/sites/default/files/docs/2004/02/5968-joint_statement_intent_11feb04_0.pdf (Annex A). But I have no way of confirming if this is the same form that is supplied by Energy UK. There is also a separate form for the suppliers use if the claimant is in receipt of Universal Credit, this is at https://www.gov.uk/government/publications/application-for-third-party-deductions-universal-credit
In answer to your question regarding the choice to pay over and above, the choice was not given to me. Instead they gave me a minimum that they would accept. So, the debt itself was, at the time, for the amount of £335.23. OVO stated that they would accept no less than £40 per week. Although I agreed to it, as I felt I had no choice but to agree to the repayments (they had already sent me an enforcement notice), I wouldn’t say that it was whole-heartedly voluntary. More seriously, at no time did OVO ask for my weekly income whilst the agreement was being set up.
+2Hiya,
The form itself, I do not have, but it is referred to in the section “How to Apply” in the following document:
“For income-based JSA, Income Support, Pension Credit and income-related ESA, use the form provided by Energy UK. https://www.gov.uk/government/publications/how-to-request-deductions-from-benefit-a-guide-for-creditors/third-party-deductions-from-benefits-a-guide-for-fuel-suppliers”
I did, however, find an application form for use by suppliers at https://www.ofgem.gov.uk/sites/default/files/docs/2004/02/5968-joint_statement_intent_11feb04_0.pdf (Annex A). But I have no way of confirming if this is the same form that is supplied by Energy UK. There is also a separate form for the suppliers use if the claimant is in receipt of Universal Credit, this is at https://www.gov.uk/government/publications/application-for-third-party-deductions-universal-credit
In answer to your question regarding the choice to pay over and above, the choice was not given to me. Instead they gave me a minimum that they would accept. So, the debt itself was, at the time, for the amount of £335.23. OVO stated that they would accept no less than £40 per week. Although I agreed to it, as I felt I had no choice but to agree to the repayments (they had already sent me an enforcement notice), I wouldn’t say that it was whole-heartedly voluntary. More seriously, at no time did OVO ask for my weekly income whilst the agreement was being set up.
Was the £40 per week to cover the arrears and ongoing usage?
How are you paying for ongoing usage?
Ongoing usage obviously needs paying for but doesn't need to be via Fuel Direct if you don't give your permission and keep up payments.
The annex A form is an example of a letter suppliers can use according to the document rather than a mandatory form. I assume ovo use something similar when contacting the DWP.
Some suppliers have more info on Fuel Direct. OVO could ideally do with more information on their website to make it clearer. For example:
https://www.britishgas.co.uk/help-and-support/struggling-to-pay/what-is-the-fuel-direct-scheme
Hey
I’ve reached out to the team so we can get full clarification on the process we take with Fuel Direct. I’ll pop back on this thread when I’ve heard back from them with more information.
Updated on 10/02/25 by Ben_OVO
Hey
As mentioned by BPLightlog, there is no OVO Formula for working out Fuel Direct.
The DWP says that Fuel Direct is a last resort payment plan that is offered to customers when all other payment plan options have been exhausted.
If this is the only suitable plan after discussions with the customer then our agents will discuss the customers’ income and expenditure to see if Fuel Direct is a good option to them as they need to pay for their ongoing usage and the arrears that are set by the DWP.
Once the customer has been informed of the usage and arrears amount the customer should know if this would leave them with little or no money to live on, and our agents will work out if this exceeds 25% of their income. If the plan is agreed to on the call, the form will be forwarded onto the specialist team who work with the DWP, and even if we send the form to the DWP they will also check to see if this exceeds the 25% and either reject it or in some cases if it is only over by a small amount they would write to the customer to advise to gain there consent.
Customers are always welcome to pay additional payments on top of their account to clear the debt down faster by making card payments however we cannot request more than the set amount set by the DWP as they control that part.
I hope this helps to clear a few things up for you.
“ our agents will discuss the customers’ income and expenditure to see if Fuel Direct is a good option”
Abby, no disrespect intended to you directly, but there is a real disconnect between ‘OVO’ and the Synergy Contact Centre over yonder.
What you state “should/will” happen and what OVO call centre staff actually do never match. Also, their knowledge of OVO working practices and protocols are a hoot. For instance, I went on Webchat the other day and asked why I’d been charged a £10 late fee when the bill is under a Fuel Direct arrangement, which the DWP pay each month without fail. The answer I got from your staff was as follows:
“You’ll have to contact the DWP about this late charge, they can look into it for you". When I stated that the reply made no sense, as it was OVO that put the charge on the bill, the next reply was “Please disregard the last reply I sent you. Apologies”.
What is going on? It would actually be comical, if it wasn’t for the fact that your treatment of customer, especially vulnerable ones leave a lot to be desired.
It makes me wonder if OVO were one of the two Energy companies that stated to OFGEM that Fuel Direct was not “Commercially viable” for them and that they inted to remove the option altogether.
I don’t know how the system worked when SSE went belly up, but it’s obvious now that OVO were not in a position to take on such a large, varied customer base in one go. To this day, they still fail to deliver what is required of such a large energy supplier. And the worst thing is, it’s affecting their customers, day in day out.
OFGEM have recently opened an investigation into the way that OVO handle customer complaints. (Their idea of ‘handling’ in my experience, is to either ignore point blank, or pass the matter on to a wholly inadequate memebr of staff,).
How much longer is this farce going to continue?
What needs to happen before the regulators realise that you are one of the most inadequate providers out there, and a risk to your customers?
A varied post, I confess. This, however, is “just the tip of the iceberg”
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