The consumer group Which? is calling on telecoms firms to let customers leave without penalty if prices are hiked mid-contract, as new research from the consumer champion shows people could face eye-watering broadband increases of almost 14 per cent in 2023.
Many broadband firms – such as BT, EE, Plusnet, TalkTalk and Vodafone – raise prices every April in line with the Consumer Price Index (CPI) plus an additional 3.7 or 3.9 per cent.
These price increases are often applied mid-contract – when customers have little choice but to accept them – and mean people end up paying more than they originally signed up for.
Based on figures from Which?’s latest broadband survey, the consumer champion has calculated how much an average BT, EE, Plusnet, TalkTalk and Vodafone customer who signed up for a deal in January 2022 could see their bills increase in the coming months, compared to the amount they originally signed up for.
Customers would face hikes of almost 14 per cent in 2023 alone. In 2023, the average BT customer would see the largest potential increase of £113.07 compared to the amount they were originally paying in January 2022. This is closely followed by EE customers who could pay an extra £105.46.
Vodafone and TalkTalk customers could pay an extra £92.35 and £90.15 a year respectively and Plusnet customers could see the lowest increase of £87.15.
These changes would follow significant increases customers have already faced in 2022. Which? analysis showed that in 2022, the average BT customer saw their prices increase by £42.93, EE by £40.04, Vodafone by £35.06, TalkTalk by £34.11 and Plusnet by £33.09.
These two years of price rises could mean that the average customer on a two-year contract with these firms could end up paying as much as £120 to £156 more on their bills than they originally signed up for by the time the next round of price rises happen in 2024.
BT customers are those who might see the biggest total impact on their bills – they could see as much as £156 added to their bills over those two years when compared to the amount they were paying before the April 2022 price increase. This is closely followed by £145.50 for EE customers. Vodafone, TalkTalk and Plusnet customers could see smaller increases of £127.41, £124.26 and £120.23 respectively.
A good broadband connection is essential to everyday modern life. Which? recently launched a cost of living campaign calling on businesses in essential sectors – supermarkets, telecoms and energy – to do more to help their customers through the cost of living crisis.
Which? is calling on all providers to carefully assess what level of mid-contract price rises can be justified in the current economic climate and allow customers to leave their contract without penalty if prices are hiked mid-contract – regardless of whether or not these increases can be said to be ‘transparent’.
It is especially important that those eligible for social tariffs do not incur any extra charges when signing up and do not have to pay Early Termination Charges to move to a social tariff – even if they are currently mid-contract.
Several providers – Hyperoptic, Utility Warehouse and Zen Internet – already protect people against inflation by committing to keep customers’ prices the same for the duration of their contract. KCOM cancelled mid-contract price rises for 2022 due to the rising cost of living.
Sky and Virgin Media do not currently employ mid-contract price rises. Both regularly make changes on an ad hoc basis – but when this happens, consumers have the right to switch without penalty.
While these are all important steps in the right direction, all providers should ensure they are properly advertising the availability and benefits of social tariffs to customers who are struggling to make ends meet.
Rocio Concha, Which? Director of Policy and Advocacy, said:
“It is unacceptable that many broadband customers are facing price hikes of up to £113 to their bill during an unrelenting cost of living crisis.
“Customers should be allowed to leave their contract without penalty if prices are hiked mid-contract – regardless of whether or not these increases can be said to be ‘transparent’.
“It is especially important that those eligible for social tariffs do not incur any extra charges when moving to discounted tariffs – even if they are currently mid-contract. Providers also should not charge any set up costs for social tariff customers.”
