The entire telecoms industry is under investigation by Ofcom to ensure companies are properly informing their customers.

Ofcom has announced an industry-wide enforcement programme into whether in-contract price rises were set out clearly enough by phone and broadband companies before customers signed up. 

The consumer watchdog is launching an investigation following complaints that consumers who took out contracts between 1 March 2021 and 16 June 2022 may not have been provided with clear information about potential price rises

Price rises are usually applied in March or April each year. 

Ofcom’s rules state that if a provider included potential future price rises in the terms of a contract, then they had to be set out ‘prominently’ and ‘transparently’ at the point of sale. 

If a customer hadn’t agreed to those terms when signing up – because they hadn’t been made sufficiently clear – providers should have notified them of the price increase and offered them a right to exit penalty-free. 

Ofcom said it is now investigating what happened in practice, collecting further information from a range of providers to assess the steps they have taken to make these terms prominent and transparent for consumers. 

Depending on its findings, the regulator may launch separate investigations into individual firms if they come across specific issues. 

With the cost of living crisis and inflation affecting every aspect of people’s lives, Ofcom said it is determined to not let telecoms companies ‘shirk’ their responsibilities to consumers. 

“It’s vital that people are told clearly upfront about any future price rises they will face while they are in contract, and we’re investigating to check whether this happened in practice,” Lindsey Fussell, Ofcom’s Networks and Communications Group Director said. 

Ofcom’s latest affordability of communications services tracker, published today, reveals that 9.1 million UK households (32%) are having problems paying for their phone, broadband, pay-TV and streaming bills. 

That is more than double the level of April 2021.

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The study also shows that 17% of households are now cutting back other spending, such as on food and clothing, to afford their communications services. This also marks a 4% increase compared to the previous year.

Ofcom maintains that there are still good deals out there – but their rules stipulate that providers must inform their customers when they are approaching the end of their contract. 

Additionally, providers must include details of any price rise, as well as their current best deals. 

The investigation follows the introduction of new rules earlier this year which require telecoms firms to provide customers with clearer and simpler information before they sign up for a new contract.

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