Utility contracts have been causing problems for a number of Essex FSB members who have been asking for help in persuading the Government to make changes, particularly in relation to rollover contracts.
Changing FSB National Policy
At the FSB National Conference 2010 in Aberdeen South East Essex FSB Chairman Terry Taber proposed the following motion:
This conference deplores the practice of rollover contracts for business utility services and calls for legislation, so that any contract rollover longer than one month should require the customer to opt in.
In his speech to National Conference Terry said: "In Essex we know we have a number of members who feel disadvantaged by 
having to continually be on the alert when contracts are to be renewed for ongoing services, in this particular case, utilities.
"Business owners are, of course, responsible for the running of their business.
"But…. by automatically rolling over contracts utility companies are making the market anti-competitive, and denying the business owner the right to test the market and find the best possible deal.
"The utility companies may therefore, reducing the profitability of that business as well.
"We find it wholly unacceptable that a utility company can affect by virtue of a rollover contract the profitability of a small business.
"We find it wholly unacceptable that a utility company can state terms and enter into a contract with a small business without the consent of that business.
"This motion calls for an opt in clause at the end of any term contract so that businesses would be first advised formally that the contract is about to end and that an offer to continue the contract is made.
"This would set out whether there are any changes.
"The FSB successfully campaigned that there should be a statutory three week notice period before insurance renewal and by campaigning for an opt in clause to rollover contracts, it would allow businesses the opportunity to ensure they are signing into a contract that would be mutually agreeable to both parties.
"I ask for delegates to vote in favour of this motion.
South Essex FSB Chairman David Barnes seconded the motion and said: "We ask conference to support this motion for 
the following reasons:
"A mutually agreeable contract can ONLY be agreed by both parties.
"At the moment the large utility company holds sway and in many cases dictate the terms. This is not acceptable.
"A contract rollover does not just continue at the same rate. The rate is at the behest of the supplier and is often double or more than the original contract rate.
"Small business owners would be empowered to research the market and find the best possible deal for their business.
"The anti-competitive practice of rollover contracts would be gone and the market would become fairer, more competitive, and more transparent.
"Small businesses would retain more of their own profits for their own business development.
"Most importantly small businesses would operate on a level playing field with the large utility companies.
"Rollover as a practice, without consent, is WRONG and goes against the tenet of "Fair Practice". If we don't stop this practice NOW! We will see it spread to other supply lines.
"That is why we ask conference to vote in favour of this motion."
Voting Result
The votes on the motion were:
Branch votes for: 123,974, Personal votes for: 178
Branch votes against: 1,447, Personal votes against: 2
so the motion was CARRIED and now becomes official FSB National Policy.
Latest News
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