Save protection scheme
The save protection scheme (scheme) came into force in January 2015, and allows a retailer to 'opt in' for save protection (protected retailer). The scheme prohibits a losing retailer from initiating contact to offer inducements to any of its consumers that are acquired by another retailer, if the gaining retailer is a protected retailer. The prohibition extends until the switch is complete. The losing retailer will still be able to save a consumer by offering an inducement if the consumer initiates contact with that retailer prior to the switch being complete. In addition, if a retailer is a protected retailer, it is prohibited from carrying out saves itself, unless the consumer initiates the contact.
In August 2017, we completed a post-implementation review (review) of the scheme.
The review found:
- the number of saves fell and the number of win-backs increased as a result of the scheme
- the scheme increased switching speed for both save protected and non-save protected retailers
- the scheme slightly reduced the average time before a switch is withdrawn
- the scheme slightly delayed switch reversal for save protected retailers
- no evidence the scheme improved or harmed retail competition
- indications from respondents to our survey that the cost to acquire consumers has increased since the Authority introduced the scheme; however, this may be partly attributable to competitive pressures in the market which have increased due to factors other than the save protection scheme.