Ofcom rules on mid-contract price rises
Consumers and small businesses have been given a positive boost by the news that telecoms providers that suddenly raise their prices will no longer be able to charge customers who decide to change their provider as a result.
The new rules, which come from telecoms regulator Ofcom, mean that providers have to give customers 30 days’ notice of any changes to their contract. Having received this notification, the consumers can now decide to switch without any charges being incurred.
The new regulations were first proposed by Ofcom in October last year and officially came into effect on 23rd January.
Ofcom customer group director, Claudio Pollack, said: “We have reached an important milestone in our work to ensure consumers and small businesses have better protection against unexpected price increases.”
During Ofcom’s investigations into contract changes, ten different providers – including Sky and Virgin Media – had put up prices in contracts that they had previously promised would remain at a fixed rate. The regulator received more than 1,000 complaints about this practice, with the telecoms operators themselves arguing that some prices had to be raised as a result of their own costs increasing over time. Vodafone, for instance, raised the fact that it had had to pay out more for services such as directory enquiries. Despite this, Vodafone and the other providers have agreed to implement the changes.
Companies will still be technically free to raise prices, but they will have to provide notice to their customers.