Ofcom wants mobile and broadband firms to set out price rises clearly in ‘pounds and pence’
Mobile and broadband providers may have to state pound and pence rises in customers contracts under a new legislation proposed by Ofcom to ban inflation linked price rises.
The media watchdog said it was concerned that customers’ contracts do not provide “sufficient certainty” about the prices they will pay.
The regulator said it would stop providers from using price rises such as 3.9 per cent plus inflation, a contract type which over half of UK mobile customers are on.
Ofcom said it was looking to toughen rules around this to tackle the problem and businesses would have to be clear about when any changes to prices will occur.
Dame Melanie Dawes, Ofcom’s chief executive, said: “At a time when household finances are under serious strain, customers need prices to be crystal clear.
“But most people are left confused by the sheer complexity and unpredictability of inflation-linked price rise terms written into their contract, which undermines customers’ ability to shop around.”
Between January and October 2023, Ofcom received over 800 complaints related to price rises
“[That is] almost double the volume of complaints received during the same period in 2021 – many of which highlighted uncertainty created by inflation-linked price rise,” the company explained.
Dawes dded: “Our tougher protections would ban this practice once and for all, giving customers the clarity and certainty they need to secure the best deal for their needs and budget.”
The government body is consulting on this proposed new requirement until 13 February 2024, and plan to publish a final decision in spring 2024.