The UK’s media regulator has accused telecoms groups of failing to offer cheaper options aimed at helping vulnerable customers appear adequately amid the cost of living crisis.
A growing number of telecom operators are now offering so-called “social tariffs” — cheaper broadband and phone packages to people who claim universal credit, retirement credit and other benefits.
However, Ofcom chief executive Ms Melanie Dawes said it wanted to see “more people taking it”, as the regulator announced plans to publish the social tariff by each provider in its annual pricing trends report, due later in the year. This year, for the first time.
Dawes told the Financial Times on Thursday. “We want companies to do more to help especially those on lower incomes to find deals they are not aware of but can really help them.”
The criticism from Ofcom comes as the government said it was working with regulators across various sectors to try to help households fight inflation.
Last month, councilor Jeremy Hunt discussed ways to support households struggling to pay broadband and mobile phone prices, as part of an “action plan” to tackle high prices that also included the Competition and Markets Authority, the Financial Conduct Authority, as well as telecoms, energy and water regulators.
Last week, Dawes sent a letter to seven industry CEOs calling for social tariffs and customer education. It said customers could save up to £200 a year by getting a better deal.
“We believe there is a very strong competitive market at the mobile and broadband retail level in the UK. But we’re concerned to make sure clients are receiving the right information to navigate this, especially when budgets are really tight for many families,” Dawes said.
Ofcom said 25 providers are offering social broadband tariffs today – up from three in 2020 when the body launched a campaign. She added that only 5 percent of eligible households had imposed a social tariff through February.
The largest operators argue that they have already increased measures to support consumers hardest hit by the cost of living crisis.
While BT said it “welcomes” Ofcom’s continued focus on social tariffs, it said in its opinion around 80 per cent of those using one were already on one of its cheapest deals. “The current privately funded model is not sustainable,” she added, and asked the government for help.
Virgin Media said eligible customers can apply for social media tariffs “with just two clicks – within seconds – on our website”.
On Thursday, the regulator also launched an investigation into Virgin Media after complaints from consumers that the operator was making it difficult for them to cancel their services.
Virgin Media said it was “committed to providing our customers with an excellent service, supporting them with any issues and offering clear options should they wish to leave”. She added that the rate of complaints related to difficulties in leaving had halved over the past year. “We will continue to work with Ofcom throughout the investigation, making further improvements in how we handle customer complaints to provide a better overall experience.”
Ofcom is also investigating whether telecoms companies are providing enough information to their customers about annual price increases affecting customers in the middle of a phone contract.
