Age UK Suspends E.ON Energy Tariff Offer

Age UK says it is suspending its controversial fixed-price energy deal with Big Six gas and electricity provider E.ON.

The charity said the two-year fixed tariff would no longer be available for new and renewing customers.

It comes days after Energy Secretary Amber Rudd ordered a probe by regulator Ofgem into the tie-up.

An investigation by The Sun found that Age UK was paid £41 for every person who signed up to the tariff - that cost people £245 more than if they were on the firm's cheapest deal.

It was claimed that the charity earned £6m from the deal.

But Ian Foy, managing director of Age UK Trading, told Sky News the charity had "done absolutely nothing wrong". He said its trading operating "unashamedly" does make profit but that this went back into support for older people.

The charity said that it earned £10 commission per customers on the deal but that the money it received from E.ON was boosted when the energy firm "kindly agreed to provide extra support" to it.

Age UK said the current deal expired on Tuesday night, at midnight, and that E.ON had informed it that it could no longer continue with the offer.

German-owned E.ON said: "This decision has been reached on a mutual basis and both organisations retain confidence in the tariff offered to customers.

"However, due to continued speculation regarding the partnership, both organisations feel it is right to pause and reflect on the best way for both parties to achieve their shared goal of helping customers."

Age UK maintained that its tariff, launched in December 2013, had been the leading national available tariff of its kind at the time.

It said that in the volatile energy market it reassured customers of having a deal that was fixed longer than one-year tariffs and benefited from having no cancellation fees.

The charity said the latest decision did not affect those currently on the tariff who could continue until their contract end date.

It added: "Age UK Enterprises is continuing discussions with E.ON to agree the best way forward."

Ms Rudd has said she takes the allegation that UK pensioners were being misled "very seriously".

The Sun said it found details of the E.ON payments to Age UK in the charity's annual accounts.

The newspaper said the charity recommended people should sign up to the higher cost tariff in leaflets and books, stating it was "great value" and "helps save energy and money".

There are currently around 152,000 customers on the tariff - equivalent to a £37m overspend - according to The Sun. Each shelled out £1,049 a year for their fuel.