It is alleged that the charity Age UK struck a deal with E.On to offer pensioners energy tariffs at a seemingly higher rate. Age UK received over £6m a year for this deal. The deal is to be examined by regulators Ofgem and the Charities Commission.
The rate that was offered on the tariff linked with Age UK cost considerably more than a deal that could have been taken out with the energy supplier separately. Some claim that these deals have cost customers over £200 a year more than they would have paid had they taken out the deal directly with E.On.
The difficulty with this deal is that those that would have signed up to the tariffs would necessarily have done so because of the affiliation with the charity. Many companies receive commissions for referrals of this nature but what is probably most shocking is the amount of money that it seems to have made in commission; seemingly off the backs of consumers. The argument remains that whilst the charity needs to raise money in order to operate, the amount raised through this one tariff seems excessive and to the detriment of the very people the charity was set up to protect.
Age Uk have stated that they only received about £10 commission per customer in response. They reject the allegations in full and state that when the deal launched it was the cheapest in the market at the time. A spokesperson from Age UK said: – “We strongly reject the allegations and interpretation of figures”.