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Telcos will not longer be allowed to implement mid-contract price rises linked to unclear metrics like inflation
In December last year, Ofcom proposed the introduction of stricter rules surrounding mid-contract price hikes for mobile, pay-TV, and broadband customers, after an investigation found that many customers were confused
The issue primarily related to inflation-based price increases, where pricing would be linked to indexes like the consumer price index (CPI) or retail price index (RPI) – indices not well understood by consumers, leading to unexpected increases in their bills.
Now, following a consultation, Ofcom has announced that new rules will indeed be introduced, requiring telecoms operators to express mid-contract price rises “prominently and transparently” in pounds and pence.
Providers will also be required to clearly explain when price increases will occur,
“Providers must draw this information to the customer’s attention prominently before they are bound by the contract, in a clear and comprehensible manner (including during a sales call or other verbal sale such as an in-store sale) to enable them to make an informed choice. Providers must also set out when any changes to the monthly price will occur,” said Ofcom in a statement.
“With household budgets squeezed, people need to have certainty about their monthly outgoings. But that’s impossible if you’re tied into a contract where the price could change based on something as hard to predict as future inflation,” said Cristina Luna-Esteban, Ofcom’s Telecoms Policy Director. “We’re stepping in on behalf of phone, broadband and pay TV customers to stamp out this practice, so people can be certain of the price they will pay, compare deals more easily and take advantage of the competitive market we have in the UK.”
The new rules will officially come into effect from 17 January 2025.
Many of the UK’s providers had already made the required changes pre-emptively over the past six months, with BT notably having already announced its revised price increases for 2025.
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