Council Calls for the Abolishment of the Security Deposits by FEA

03/08/2010 12:24

The Consumer Council of Fiji is calling for the abolishment of the security deposits levied by Fiji Electricity Authority. The Council believes that FEA’s security deposit requirement is illogical if consumers have not defaulted payments. In addition to this security deposit is an archaic required and should be abolished.  

Consumers are facing double blow from FEA. First by receiving an electricity bill that in most cases is almost doubled the amount previously paid by consumers as a result of new tariff rate and now with a letter demanding exorbitant security deposits or the amount will be charged to the electricity bill. What this means to a customer is pay up or face electricity cut if the bill that includes security deposit is not paid? If a consumer is unable to pay, this will give further opportunity to FEA to make quick bucks through reconnection fee. Why can’t Commerce Commission stop a monopoly abusing its dominant position in the marketplace? Consumers are disappointed that FEA is capitalising on the new tariff rate by increasing the security deposits of its customers. How can FEA expect consumers to pay increased security deposit with their static income and in such a short time?

It seems FEA does not care about a customer’s plight.  As a monopoly FEA can afford to display a “pay up or ship out” attitude towards customers. FEA’s attitude is disappointing and consumers in Fiji should not have to put up with this poor attitude which certainly demonstrates poor corporate responsibility. Unfortunately the FEA is further supported by the Electricity Act drawn in favour of FEA and not the consumers. The legislation itself is unfair to consumers where the liabilities are passed on to consumers thus protecting FEA from liabilities. Such laws make an organization not only irresponsible but inefficient.

The Council is calling for the abolishment of the security deposit which is not making sense if consumers have not defaulted payment in the first place. FEA must explain to the consumers on the purpose of the security deposits and whether FEA earns interest on these security deposits?

In Australia, energy security deposit is applied to consumers depending on their creditworthiness. In other words security deposit is required in cases where a consumer does not have a good payment history with Utilities Company or can’t provide a satisfactory credit check.  Hence, it is not applicable to every consumer as practiced by FEA. For FEA to charge all consumers in Fiji a security deposit (an average of two months security deposit) is clearly seen to be money making policy, which the Consumer Council would like to see scrapped.

People with low incomes suffer the most when prices rise or through payments of security deposit, and disconnection fee.  Consumers have expressed concern at being faced with financial difficulties when asked to pay an electricity security deposit. The Council received complaints from consumers whose electricity bill increased from $28 monthly to now to $51 and an increase in security deposit from $20 to around $40. The Commerce Commission must explain to public how poor had benefitted from the new tariff rate?