If your broadband or mobile provider has mid-contract price increases built into their terms and conditions, you can expect your bill to go up by around 7-8% this year.
Some providers take the inflation percentage figure (4% this time around) and add an additional percentage on top of it. This extra figure is 3.9% for most firms. So, for spring 2024, your monthly bills will rise 7.9% if your firm calculates its increases this way.
Other providers use a slightly different method to calculate their hikes. They may use January’s Retail Prices Index (RPI), which measures inflation in a different way to the CPI. Then they add the industry-standard 3.9 percentage points on top.
RPI tends to track higher than the CPI, so prices are likely to rise more steeply using this method. We don’t know what January 2024’s figure is yet, but we know the measure hit 5.2% in December 2023. So, if mid-contract hikes were being calculated with this figure, people would see their prices rise 9.1% from March or April.
Sky is the only major provider that operates as a bit of an outlier when it comes to these price increases. Along with its sister-brand NOW, it doesn’t usually put up its prices in line with inflation. If it does opt to hike prices, it allows many of its customers to quit their contracts penalty-free.
In 2023, the provider’s average price rise was 8.1% – much lower than the 14.4% implemented by most suppliers as a result of record levels of inflation. Here’s how all the biggest providers change their prices every year:
|
Provider |
Price hike method |
2024 price hike |
|
BT |
December’s CPI + 3.9% |
7.9% |
|
EE |
December’s CPI + 3.9% |
7.9% |
|
Plusnet |
December’s CPI + 3.9% |
7.9% |
|
NowTV |
No hike in contracts |
0% |
|
Shell Energy |
December’s CPI + 3% |
7% |
|
Sky |
No hike in contracts |
TBC |
|
TalkTalk |
December’s CPI + 3.7% |
7.7% |
|
Three |
December’s CPI + 3.9% |
7.9% |
|
Virgin Media |
January’s RPI + 3.9% |
TBC |
|
Vodafone |
December’s CPI + 3.9% |
7.9% |
As mid-contract rises are usually written into contracts, most people will not be able to avoid spring 2024’s price hikes. This is because exit fees from the minimum term of a mobile or broadband contract tend to be very expensive. Your provider will seek to cover most of the money you would have paid them over the rest of the deal.
You should be able to avoid mid-contract price hikes if your deal has expired. If you haven’t signed up for a new contract for two or more years, you’ll almost certainly be free to leave your provider without facing a penalty.
It’s better to sign up for a new contract as deals for newbies often work out £100s a year cheaper than rolling post-minimum term arrangements. Check out our best broadband deals to see what’s out there.
If your minimum term is drawing to a close (ie, will be ending between now and early May), you should be able to beat this spring’s price hikes. It’s worth looking into the deals that are available now to give yourself the best chance of maximising your savings on a new contract.
Roughly a month before the end of your minimum term, you will be in a strong negotiating position with your current provider. If they can’t beat the top deals you’ve seen, you should consider switching.
If you’re tied into your existing deal until this summer at the earliest, it’s unlikely you’ll be able to do much about the upcoming mid-contract price hikes. Switching would probably land you with a hefty exit fee.
Unless your provider’s not giving you the service they promised, you’ll only be able to switch penalty-free if they hike your bills by a higher amount than they’ve set out in your contract. When this happens, you will be given at least a month’s notice. You’ll then have around 30 days to quit your contract.
You may be able to haggle with your provider and escape the mid-contract rises. But you will be coming from a weak negotiating position and could compromise future negotiations with that supplier. Some providers may offer to buy you out of your contract (ie, they’ll cover the cost of your exit fees). While this may save you some money now, doing so could compromise your efforts to get a better deal in the future.
Here’s how to seek out a better deal:
You can take a look at multiple providers and prices in one simple search. All you’ll usually need to tell us is your postcode and who your broadband is currently with.
Happy with your current provider but you’re just not keen on the price? You can use the information you gathered when comparing to negotiate a better deal. There’s no guarantee your current provider will be able to offer something similar, though.
If you find a deal you like (or your current broadband provider can't offer you a deal that you're satisfied with), you can cancel without penalty and sign up with a different provider instead.
Make sure you confirm the date of your last payment with your current broadband provider so you can arrange when to start your new one
In the first half of February 2022, there was a 75% increase in the number of people comparing deals through us.
Hannah Isitt, our broadband expert, says: “While it's certainly possible to switch at any stage in your contract, you'll have to pay an early termination fee and perhaps even pay a fee for returning your provider’s equipment."
"Before switching, you should weigh up the cost of staying with your current provider and paying the increased amount versus switching to a new deal.”
It’s also worth considering that many providers will be increasing their prices in line with the rising cost of living, so check you can find a better deal before cancelling your current deal.
Under current Ofcom rules, providers are allowed to hike prices mid-contract so long as they set out the formula for how they do so within the contract. Ofcom also says they should set out these future rises “prominently and transparently at the point of sale”.
So, what you’ll see in your mobile, broadband, landline and TV contracts is a clause that will tell you:
If this clause doesn’t appear in your contract, you’ll be able to break out of your minimum term without paying exit fees. Sky customers should check their contract as the provider tends to not write annual hikes into its contracts.
Providers that do implement mid-contract hikes say they do this to ensure they can continue to maintain their existing level of service and invest in their infrastructure. For example, ahead of 2023’s price hikes, EE said it needed to raise its customers’ prices by 14.4% (December 2022’s CPI of 10.5% plus and extra 3.9%) to make up for an 80% hike to its energy bills and a further 20% increase in the production costs of its Home Hubs.
Telecoms regulator Ofcom has also defended having some form of annual price rise in place given the country’s mobile and internet infrastructure is in the midst of a major upgrade.
Ofcom recently said: “Telecoms providers – like all businesses – face a range of cost rises. Network investment is one of these costs. While average household spend on telecoms services has been broadly flat in real terms in recent years, at the same time customers have benefited from better, faster services and are using more data than ever before.
“And as demand for data continues to accelerate, the UK’s broadband and mobile infrastructure is getting a much-needed upgrade. This requires significant investment from telecoms companies, who are also increasing the capacity of their networks to accommodate increasing data use.
“We regulate wholesale telecoms prices in a way that sets the right conditions for companies to build these faster, more reliable networks.“
The good news for consumers is that Ofcom is planning to ban inflation-linked mid-contract price hikes. It says the current system creates “uncertainty” about the costs customers will face over the lifetime of a contract as no one (not even top economists) can know exactly what will happen to inflation in the future.
The industry regulator wants providers to spell out any mid-contract price rises in pounds and pence at the point of sale. If this is brought in, it will mean you will know exactly what your monthly costs will be for the duration of your deal. Not only does Ofcom believe this will provide cost certainty, it also expects it will increase competition in the mobile and broadband markets.
You might be able to get a cheaper deal by bundling your broadband, phone and TV into one convenient package.
But it’s worth knowing that if your price increase only applies to your broadband, your right to cancel might only apply to that service and not to your TV package, phone line and other bundled services.