The UK"s communications regulator, Ofcom, has announced new changes to mid-contract price rises that will affect major phone, broadband, and pay-TV companies. Currently, companies are hit with inflation-linked price increases mid-contract, but new rules will ensure customers know how much prices will increase during their contract, at the start of their contract, in pounds and pence.
The new rules will ensure that customers are better protected when they take out a contract from 17 January 2025. At the point of sale, customers will see clearly how much their contract costs from sign-up, plus any price increases they will incur mid-contract and from what date those increases will come into force.
In an example image shown by Ofcom, a contract page may say, in large letters, "Monthly subscription price: £30.00 until 31 March 2025". Under that will be something like "Increasing to: £31.50 on 1 April 2025" and "£33.00 on 1 April 2026".
Commenting on the change, Cristina Luna-Esteban, Ofcom Telecoms Policy Director, said:
"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.
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."
What is a real shame about this development is that it has come into force well after the inflationary spikes witnessed by the UK economy. Customers have already suffered big price rises when they can least afford it, so Ofcom has failed pretty badly in that regard. Hopefully, these new rules will still be around the next time a wave of inflation squeezes consumers, so they are somewhat helped.
Ofcom said that 17 January 2025 is the deadline for these changes, but BT and Vodafone have already changed their pricing practices. Hopefully, the rest of the providers will get on board before the deadline.