Worried about broadband cost? Ask the provider for a ‘social tariff’

Worried about broadband costs? Millions of cash-strapped pensioners can slash their bills this winter by asking providers for a ‘social tariff’

Millions of cash-strapped pensioners who face a hike in landline phone and broadband costs this winter can slash their bills by switching to a little known tariff. 

Telecoms giants are raising charges by up to 15 per cent in the New Year. This is on top of recent increases, with BT imposing an 8 per cent average increase earlier this year. The average monthly broadband and phone bill is now £40. 

But industry regulator Ofcom is demanding that telecoms providers offer cheaper deals to their most hard-up customers. 

Counting the cost: Industry regulator Ofcom is demanding that telecoms providers offer cheaper deals to their most hard-up customers

This includes the 2.5million people in retirement on pension credit – plus a further 850,000 who are eligible but fail to claim. 

Pension credit tops up incomes to ensure a single pensioner receives at least £182.60 a week or £278.70 for a couple. Find out how to apply for pension credit here.

BT, Sky, Virgin Media and Vodafone are among those offering so-called ‘essential’ tariffs, typically only charging up to £20 a month. 

But they stubbornly refuse to promote them so more people can apply. Details of the deals can only be found by either digging around a provider website or by contacting a supplier directly and asking for details. What’s more, the customer will have to provide proof they are eligible. 

Some suppliers, including BT-owned EE and Plus Net, do not offer the deals at all – providers are not legally bound to do so. 

Dennis Reed, of campaign group Silver Voices, says: ‘Elderly, vulnerable people are particularly reliant on the phone and internet to communicate with the outside world – providing a lifeline for the lonely.’ 

He adds: ‘It is a disgrace that telecom giants fail to publicise social tariffs for those most in need.’ 

Ofcom says eight million homes are already having problems paying their phone and broadband bills. It is not only calling for greater support for the elderly, but for other lowincome households that rely on benefits for their financial survival. 

The regulator says: ‘As many as 97 per cent of eligible low-income households are yet to take advantage of special deals available. We are demanding the industry promotes its social tariffs.’ 

It adds: ‘The cost-of-living crisis is now putting an unprecedented strain on many household budgets.’ 

Ofcom wants all telecoms firms to write to or email customers who are struggling to pay their bills to inform them that social tariffs are on offer. Currently, no provider does this. The regulator has found 70 per cent of people who claim benefits are unaware that social tariffs exist. 

James Barford, a telecoms analyst at consultancy Enders Analysis, says: ‘It is perhaps understandable telecoms firms offering social tariffs are not willing to spend any of their marketing budget to promote them – as they do not make them any money. 

But we expect some serious price increases early next year in the wider phone and broadband market with many telecoms companies using a price increase formula linked to the December rate of inflation. This means demand for social tariffs could rise.’ 

BT added 3.9 percentage points on to a rate of inflation level at the start of this year to determine its tariff increases. 

It is expected to use this same formula next year. Ofcom has found 29 per cent of households are struggling with telecoms bills – nearly double the 15 per cent reported last year. 

Ofcom says anyone who is not on a social tariff, but is eligible, should be allowed to switch to one free of charge – even if they are tied into a lengthy contract. 

If a current supplier does not provide a social tariff, a household should be able to switch to a competitor without penalty. 

BT says: ‘We actively promote our ‘essential’ packages if someone is struggling to pay their bill and contacts us by phone or visits a BT shop.’ It also says that customers of EE and PlusNet, where social tariffs are not available, can transfer to BT at no cost. 

BT Home Essentials customers – its social tariff – pay £15 a month for a free landline and internet access offer. BT customers might expect to pay from £28.99 a month for a similar deal. 

Eligibility for social tariffs varies between providers, but usually requires a customer to provide a National Insurance number and details of any benefits received.

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