BT is changing how it handles mid-contract price increases ahead of stricter rules being introduced by the UK communications regulator Ofcom. Instead of linking rises to inflation rates, BT will state clearly, in pounds and pence, the exact amounts customers can expect to pay.
The decision follows an Ofcom review that found current practices for mid-contract price rises can be unclear and make it hard for consumers to understand how their bills will change. Under BT’s existing approach, tariffs are adjusted once a year according to the Consumer Price Index (CPI). Because inflation fluctuates, customers have often found it difficult to predict the actual financial impact.
Ofcom has proposed that telecom operators must display any future price increases prominently in monetary terms at the point of sale and make clear when those changes will take effect. The regulator’s final rules are expected in the coming months, with operators required to adopt new pricing disclosures within four months of the decision.
Marc Allera, CEO of BT Consumer, said in a company blog that BT will adopt a “clear and simple” pricing model this summer that removes percentage-based figures tied to CPI. Under the new approach, Allera indicated that new mobile customers can expect typical increases of around £1.50 and broadband customers around £3.
Allera acknowledged that price increases are difficult conversations, especially during a cost-of-living squeeze, but said the adjustments are needed for BT to cover rising operating costs.
Ofcom’s proposed changes aim to give customers greater certainty over their bills during the life of a contract. Under the current system, BT’s tariffs have historically been uplifted each March using the previous December’s inflation figures; last year that resulted in a 14.4 percent increase for some customers.
The regulator says clearer, money-based disclosures will help consumers budget more effectively and make fairer comparisons when choosing providers. These measures form part of a broader effort by Ofcom to strengthen consumer protections across the UK telecoms market.
BT confirmed it will still apply a planned increase of 3.9 percent at the end of March in line with the latest CPI, but said that this is likely to be the final rise tied directly to the inflation rate before the new disclosure requirements take effect.
The announcement comes as BT and other providers prepare to set annual price adjustments for 2024 following a recent rise in inflation to 4 percent. Consumer research suggests that a large share of customers—almost three-quarters—would consider switching providers if their mobile or broadband bills increase again this year.
(Photo by Towfiqu barbhuiya on Unsplash)
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