In addition to broadband customers, millions of mobile phone users will experience price increases beginning April 1, 2023.
Bills for millions of mobile phone and internet users will increase by 17.3 percent in just one week.
Many broadband and mobile service companies raise their prices by the Consumer Price Index (CPI) plus 3–3.9% in April.
As these price increases are frequently implemented in the middle of a contract, customers are forced to either accept the new prices or pay expensive early termination fees.
However, 11 million people without contracts could avoid the rise by switching before next week.
It follows Ofcom’s review of mid-contract price rise transparency.
Uswitch has also campaigned to allow all consumers to abandon contracts without penalty in the event of price increases. As the majority of providers do not permit this. The price comparison website believes that providers who impose inflationary price increases should allow customers to terminate their contracts without penalty or offer fixed-price contracts.
Ernest Doku, a telecommunications expert at Uswitch, stated, “It is still possible to avoid April’s price increases. Customers of broadband and mobile services should immediately determine if they can transfer to avoid overpaying.
“Millions of consumers are currently contract-free and can therefore protect themselves from these inflation-busting price hikes.
In addition to being able to transition to a faster and more reliable product, you could also pay less per month. Although future price increases may still apply in many cases after 2024.
Who has the greatest early termination fee?
Several internet companies have verified that they will increase their efforts to assist vulnerable and low-income households. Vodaphone, for instance, is automatically exempting financially vulnerable consumers from this year’s price increases.
TalkTalk has stated that it will automatically exempt its most financially vulnerable consumers, but has not explained its criteria for determining financial vulnerability or how this will be publicized.
Providers are aware that mid-contract price increases can be catastrophic for financially vulnerable customers, so their social tariffs feature fixed prices that are exempt from annual increases.
Based on the average amounts paid by low-income customers in Which?’s a most recent broadband survey, the consumer advocate calculated the amount by which low-income BT, EE, Plusnet, TalkTalk, and Vodafone customers (those earning £21,000 or less annually) could see an increase in their monthly payments.
It was discovered that payments to this group could increase by £77 per year. On average, they will incur an increase of £52 per year and will pay at least 2% of their annual income for broadband service, or £431 per year.
Customers of BT had the highest monthly prices of any of the companies examined by Which? and could see an increase of nearly £60 per year beginning next week. Low-income BT customers may incur the highest early termination fees, amounting to £194.34 if they wish to quit the company a year early.
Adopting a social tariff
A social tariff could save the typical low-income consumer affected by the price increase £220.32, or £18.36 per month.
Individuals claiming Universal Credit, Pension Credit, and a few other benefits are eligible for reduced broadband and phone packages.
They are delivered in the same manner, but for less money. Some providers may refer to such broadband as “essential” or “basic.”
Switching to a social tariff would result in the greatest annual savings of £260.16 (£21.68 per month) for BT customers. Vodafone clients would save the least, £168 annually (£14 per month).
Director of Policy and Advocacy at Which?, Rocio Concha, stated: “Telecoms providers must immediately rescind the 2023 price increases for financially vulnerable customers. They should proactively identify these consumers and ensure they are not financially penalized if they choose not to sign up for a social tariff.”
