KEY POINTS:
Mercury Energy has agreed to let its 300,000 customers defer their power bills for up to six weeks if they get into financial difficulty.
The state-owned power company will also let consumers in financial hardship pay off their bills in instalments, and is expected to wave installation charges
for meters that can be used to pay for power in advance.
The deal, finalised at a meeting with social service and budgeting agencies in Auckland yesterday, comes just 3 1/2 weeks after Mangere mother of four Folole Muliaga died after Mercury cut off the family's power for non-payment of a bill for $168.40.
Mrs Muliaga had been on an oxygen machine.
Mercury spokeswoman Chantelle Urquhart said the company was still working on details late yesterday and would not confirm the changes until early next week.
But Darryl Evans, of Mangere Budgeting and Family Support Services, said social agencies attending the meeting were pleased with the outcome.
"They have listened and, in a very short space of time, put some new protocols and services in place to better serve low-income families and families with a medical dependency."
No figures are available for the number of families who have their power disconnected because of unpaid debts, but Work and Income said this month that it spent $11.9 million in the past year paying 38,333 power bills, including 7510 for non-beneficiaries in circumstances like the Muliagas'.
It said $11.5 million of that was in the form of loans.
Total household debt of all forms, including mortgages, has almost trebled in relative terms from 50 per cent of after-tax annual household incomes in the early 1980s to 140 per cent of earnings in 2004.
A survey in 2000 found that between 8 and 12 per cent of people had been unable to keep up payments for their mortgage or rent, power, gas or phone bill, or payments for goods such as cars and appliances, in the previous year.
Mr Evans said a new social agency pack, to be released by Mercury on Monday, would offer four kinds of relief to consumers in financial hardship:
* An extended payment date six weeks after the due date.
* An instalment plan allowing arrears to be paid off gradually.
* A "smooth bill" option, where consumers' monthly power bills are fixed at a steady one-twelfth of the amount they paid in the previous year, with a catch-up bill or rebate at the end of the year if their usage has changed.
* An "Easymeter" option, where Mercury installs a meter at the house and gives the family a card which can be charged up with any amount over $20 at kiosks at selected post offices and other sites. The meter beeps four days before the power runs out.
Mercury currently charges around $100 to install a meter, but Mr Evans said the company was looking at waiving the charge for families suffering hardship.
He said the company had also agreed not to disconnect power at all where families produce either a doctor's certificate or a medical document on file at Work and Income stating that someone in the house needed power for a medical condition.
It will also give social service agencies online access to their clients' accounts in the Mercury computer system if they obtain authority from the clients.
"We would then be able to go online and monitor the client's account and set up their repayment schedule up to six months," Mr Evans said. "In the past it depended on who you got on the telephone. Now we have a set period we have been told we can work to.
"Most government departments such as Housing New Zealand give three months to bring their accounts up to date, so Mercury are being very flexible in saying arrears can be paid off in up to three to six months. The only condition is that any new debt be paid on the requested payment date."
He said the company was changing the format of its bills to show the amount owing in red and to state that if people are in financial hardship or have a medical need for electricity, they should contact the company or a social agency.
Two brochures were being printed in English, Maori, Samoan, Tongan, Cook Island Maori, Chinese and Korean to go out with power bills explaining the new policies, with contact details for social agencies.
Meanwhile, submissions close on Monday for the Electricity Commission's national review of guidelines for low-income consumers involving all power companies.
