Consumer advocate Martin Lewis is urging the Government to prohibit mid-contract price increases above the inflation rate following a surge in bills for numerous broadband and mobile customers.
Telecom companies are now required to clearly inform customers about the precise amount their bills will go up by in monetary terms. This directive came into effect after many households experienced bill hikes of up to 17% in 2024 due to rising inflation rates.
However, a recent study by MoneySavingExpert.com examining over 47,000 tariffs revealed that three out of four customers ended up paying more under the new regulations imposed by Ofcom.
The analysis indicated that the majority of customers faced price hikes exceeding the inflation rate under the revised system, with social tariffs, which offer discounted rates to individuals receiving benefits, being particularly hard hit.
Martin Lewis, the founder of MoneySavingExpert.com, emphasized the need for a complete ban on mid-contract price rises above the inflation rate. Lewis is scheduled to present his findings today at the House of Commons Public Accounts Committee meeting on broadband, water, and energy expenses.
In response to Lewis’s call for action, Ofcom expressed its commitment to maximizing consumer benefits from telecommunication services at fair prices. The regulatory body plans to conduct a comprehensive review of the impact of pricing transparency rules, with the results set to be released in 2027.
Ofcom also highlighted existing consumer protections that facilitate easy switching to better deals and the availability of fixed-price social tariffs for eligible customers. Moreover, they cautioned against a blanket ban on price increases, citing potential adverse effects like the elimination of introductory discounts beneficial for consumers and competition.
For individuals out of contract, it is advisable to explore cost-saving options by comparing prices online, assessing actual usage needs for minutes, texts, or broadband speed, and considering switching providers or negotiating for better deals. Eligible consumers may also inquire about qualifying for reduced-rate social tariffs if they receive benefits.