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Victoria. Labor. Exit Fees for Utilities to be abolished.

November 30, 2012

Victorian Labor will abolish exit fees from gas and electricity contracts to make it easier for Victorian families to change retailers and receive the best price on their household bills, Labor spokesperson for Energy and Cost of Living, Lily D’Ambrosio said today.

Ms D’Ambrosio said under a Labor Government all fixed term market contracts would be abolished except those that offer genuine fixed prices and conditions for the duration of the contract period.

“Labor will abolish exit fees for all energy contracts, except for genuine fixed term market contracts where an exit fee is justifiable”, Ms D’Ambrosio said.

“Labor’s policy will remove barriers for consumers wanting to get better prices and deals in the energy retail market and make it easier for consumers to compare products.

Not all market contracts are fixed term. However, almost all fixed term contracts contain variable pricing. These fixed term market contracts can be confusing for consumers who may enter a contract reasonably believing the contract also locks in a fixed price.

Ms D’Ambrosio said that according to the Essential Services Commission in the last year alone electricity prices in Victoria have increased by up to 12% and gas by 7%.

“Premier Baillieu was elected on the promise that his government would reduce the cost of living for Victorian families, but after nearly two years in government he has yet to deliver on this commitment.

“With the cost of living rising, Victorian households are looking to the Baillieu Government to ease these pressures, but have been given nothing in the way of support.

“Exit fees can cost a family up to $45 and this is the first of many policies that Labor will commit to help Victorian families manage the household budget.

“The Consumer Action Law Centre has welcomed Labor’s policy because they know that exit fees are a barrier for families in switching retailers for a better deal; and that abolishing fixed terms contracts that are not genuine will improve competition and pricing.

“Labor calls on the Baillieu Government to support its move for the abolition of exit fees for electricity and gas contracts.

“If Ted Baillieu was serious about reducing the cost of living for Victorian families he would support Labor’s policy”, Ms D’Ambrosio said.


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