Partner Article

Ofcom to act on price hike consumer complaints

Ofcom, the UK’s independent regulator for communications industries, said on Thursday that it has launched a consultation into protecting customers from unexpected price hikes by telecoms services.

A backlash from consumers who suffered a surprise increase in their bill this year resulted in the consultation being put forward, and Ofcom has said it may allow customers to come out of their contract if prices are raised.

Service providers will also be expected to offer complete transparency when it comes to potential price increases.

Currently, consumers who fall victim to a price rise whilst under contract must either take the hit or pay a penalty to exit their contract.Ofcom’s proposals will offer an escape route if the measures are approved.

A series of other possibilities will also be considered, and the regulator said transparency alone could be the answer to avoiding “consumer harm”, while an “opt-in” choice to variable price contracts will also be considered.

Further to this, a complete boycott of variable price contracts will be discussed, although Ofcom indicated that a misalignment with the European legal framework could eliminate this option.

Claudio Pollack, Ofcom’s Consumer Group Director, said: “Many consumers have complained to us that they are not made aware of the potential for price rises in what they believe to be fixed contracts.

“Ofcom is consulting on rules that we propose would give consumers a fair deal in relation to mid-contract price rises.”

During its review period, Ofcom investigated 1,644 customer complaints about regulations between September 2011 and May 2012.

The regulator will close its consultation on 14th March this year, and will publish its results in June.

This was posted in Bdaily's Members' News section by Miranda Dobson .