How do you define an essential service? It goes without saying that water and heating top the list of things people literally can’t do without. But increasingly, broadband is becoming vital for millions of people too.
You may be working from home more often. Your family might be reliant on a good Wi-Fi signal to communicate, especially if you’re keeping in touch with someone older more vulnerable, or someone who lives in a rural area not served so well by phone signals. And with analogue TV a distant memory, you’ll need broadband to stream television, operate gadgets and access essential services through the internet, from benefits to bank accounts.
Our increasing reliance on broadband can be a big problem though. Thousands of people seek help every week over system failures and billing issues. Many of the people I speak to are extremely dissatisfied with customer service from the big broadband companies and as a consequence are reluctant to move to another service provider fearing ‘more of the same’.
But there’s another, major issue with broadband. Most businesses will lock you in to a contract that lasts for 18 to 24 months. However, you might not have noticed a key contract clause. This allows a broadband business to raise the price you pay each month at a set point mid-contract. This is usually every April. In the past, providers have raised the amount you pay far higher than the Consumer Price Index (CPI) – which is next announced in January. The CPI is the main measure of inflation – the change in the cost of a typical basket of goods and services – which is currently standing at 10.1%. This means that if past pricing patterns are followed, broadband could go up by a whopping 14%. I think this is outrageous, as does consumer organisation Which? who are running a campaign to get businesses to defer price hikes in 2023.
If you want to avoid an expensive surprise in April, it’s a good idea to start thinking how you could save money right now. Here are some tips.
What to do if you are out of contract
Broadband regulator Ofcom estimated that 7.4 million people were ‘out of contract’ in 2021 – a huge percentage of the population. This matters because people out of contract are generally paying much more for their broadband package than new customers. If you’ve been out of contract for a few years, then you’ll have had all those price rises stuck on your monthly payments. It’s not unheard of for people to be paying upwards of £100 a month for their broadband and TV packages. You can easily halve this, or get your payments down as low as £20 if you are happy to go for a basic package.
One of the reasons why people tend to miss when they fall out of contract is because most of us have been switched to online bills (willingly or not). If your bills are digital, you’re less likely to check them, or remember your password and log in details. It’s worth spending a few minutes getting your password reissued and reacquainting yourself with your online bills in all sectors, as there are great savings to be made. Alternatively you can use free apps like Little Birdie where you’ll get reminders to switch when your contracts come up for renewal.
I’d also make a point of adding your contract renewal date to your calendar too. Add a reminder for the month before the renewal day so you’ve got time to shop around for the best deal and you aren’t rushing around last minute.
If you switch now though, remember to ask about price rises in April 2023. Regardless what the business says, their contracts allow them to hike the amount you pay. So check out the Mirror for the latest rate of inflation, then add on 3%. Add that to your monthly payments and have a think about whether you can afford it. You usually get better deals if you sign up for longer periods, but that could be a false economy if you can’t afford the prices rises, as exit fees can be unbelievably high if you want to leave a contract early. So have a think about whether it makes more sense to sign up to a more expensive deal that only lasts 12 months, particularly if you think you might move or change jobs in the next few years.
What to do if you are in contract
Exit fees are by far the biggest bugbear for broadband customers after service issues. Exit fees are ludicrously complicated and work on a sliding scale. So if you signed a two-year contract a few months ago, it’s going to be very pricey to get out of the contract early. However, if you’ve got a few months to go, it might be worthwhile. In fact, if you’re near the end of your contract, the broadband provider might be able to offer you a much better deal to stick around.
If you’re trying to escape to a better deal mid-contract, your main ways out are by explaining to the firm that you can’t afford your current deal or pointing out if the broadband business isn’t delivering on its promises.
As I mentioned in my recent column [https://www.mirror.co.uk/money/i-saved-540-broadband-bill-28181144], if you are entitled to certain benefits, you should qualify for one of the new ‘social tariffs’, that can reduce your bills to £10 to £20.
If you have less money coming in than you have going out – or if there’s little left over after you’ve paid all of your monthly financial commitments – you meet the definition of being in financial difficulties. Make a mini-budget showing this and contact the broadband firm. They are obliged to look at your circumstances and offer you a plan tailored to your needs. This might involve transferring you to a cheaper deal, coming up with a payment plan to give you a bit of breathing space and helping you cut parts of your existing deal that you don’t need.
Failing that, you’ll need to demonstrate that the business is in breach of contract if you want to bail early. This could be that the business has changed the way it operates, withdrawn services or introduced significant changes. Alternatively, if the service in your area is patchy, or you’re not getting the broadband speed you were promised 50% of the time, you may be able to leave without charges too.
Report the problem to the firm, then download one of the many free broadband speed checkers available. During peak times, use these apps to check your speed and take screenshots. This will demonstrate that the firm isn’t delivering on its promises.
Lots of people tell me that they stay with a broadband service that they hate because the other broadband providers may use the same infrastructure. Yet we do this with electricity and gas services, so don’t let the underlying systems that bring broadband services to you home put you off. There are great bargains to be had by switching to a different provider.
Use a comparison site to get a feel for the deals available in your area. MSE have a great one here: https://www.moneysavingexpert.com/compare-broadband-deals/ Always speak to the firm on the phone first though. This is useful because you can ask all of those tricky questions about things like TV packages before you transfer over, along with establishing if you need to have an engineer come out to connect you up. It’s also essential, because you’ll have an idea of how easy it is to contact the firm is something goes wrong too.
Featured in Mirror – Martyn James