TalkTalk has confirmed that it will be making changes to its mid-contract price rises following the announcement of Ofcom's new rules.
The regulator this month announced a ban on inflation-linked price rises for mobile phone and broadband contracts.
TalkTalk has said that, from August, it will be moving away from inflation-based mid-contract price rises and instead will tell customers how much their contract will rise each year in "pounds and pence". This change reflects the changing needs of its customers and will provide greater clarity at point of sale.
Under current rules, broadband and mobile providers are allowed to increase prices mid-contract in line with inflation, plus extra on top of this. Most use consumer prices index (CPI) inflation data for December, or retail prices index for January to determine their increases. This year's price increases were between 7.9 per cent and 8.8 per cent.
From 12 August, customers joining or re-contracting with TalkTalk will see their monthly bill for broadband increase by £3 a month in April. Over the course of the year, this will equate to £36.
However, customers who took out contracts before August 12, will continue to incur increases based on CPI, plus 3.7 per cent annually in April. TalkTalk says this applies to in-contract and out-of-contract customers. Those out of contract, can switch to another deal or leave without facing a penalty. TalkTalk's most financially vulnerable customers will continue to be excluded from the annual broadband price rise.
Susie Buckridge, TalkTalk CEO, said, “For more than 20 years TalkTalk has focused on delivering value for customers. We remain fully committed to providing great value broadband and ensuring our customers have a clear understanding of the price they will pay throughout their contract. We will be moving away from an inflation-linked annual broadband price rise to a flat increase following Ofcom’s new guidance. We believe this will help improve transparency and consumer understanding of the change.”
Under Ofcom’s new rules, all telecom providers need to detail increases clearly in contracts for both phone, mobile and broadband. The new requirement will come into force for contracts taken out from 17 January, 2025. TalkTalk said that it was working towards full compliance with Ofcom’s new guidance for the January 2025 deadline.