/ Technology

Mobile customers are still baffled by RPI price rises

Fixed Means Fixed logo

Even if you managed to find the clause buried in your ‘fixed’ mobile phone contract that says your provider can hike prices by the rate of RPI, would you know what that means?

Ahead of the results of Ofcom’s consultation on fixed mobile phone contracts, our latest research has found that most mobile customers don’t know the rate their so-called ‘fixed’ mobile contract can increase by.

What’s RPI when it’s at home?

‘Fixed’ mobile phone contracts allow providers to hike prices as long as this isn’t higher than the rate of inflation. This is a contradiction we’ve been working to put right with our Fixed Means Fixed campaign following price rises from Vodafone, Three, Orange, T-Mobile, O2 and others. The price and all other aspects of mobile phone deals should remain the same for the minimum term of the contract.

And we now have more evidence that something must be done. Our latest research found that nearly half of us don’t know what RPI (the Retail Prices Index) actually means, and eight in 10 don’t know what the current rate of RPI is. Yet, RPI is what mobile phone providers base their price rises on. Ultimately, millions of mobile customers are being caught out by unfair price rises due to clauses and technical terms buried in the small print of contracts.

For the record, RPI is based on the cost of a theoretical basket of everyday goods and services, and it’s currently at 3.1%. I’d forgive you for not knowing what it was, or indeed what its precise level is!

Ofcom must do right by mobile customers

We launched our Fixed Means Fixed campaign last year in response to thousands of your comments here on Which? Conversation. Mobile customers from all the major providers were not happy with price rises on their ‘fixed’ contracts, and so we submitted a formal complaint to Ofcom. The regulator soon published a consultation containing four potential options – 1 . do nothing, 2. force companies to be clearer in their marketing, 3. let us opt in to ‘variable priced’ contracts or 4. allow customers to exit contracts penalty-free if prices are hiked.

Ofcom expressed a preference for option 4 and so did you when we put it to the vote. Needless to say, we don’t think much of options 1, 2 and 3, and so we’re urging Ofcom to stand firm in the face of heavy lobbying from mobile providers.

Our research clearly shows that even if companies were true to their word and were more transparent in their marketing (our mystery shopping exercise suggests that’s no certainty), there’s still a danger that most people wouldn’t know what an ‘RPI price rise’ meant. This makes it all the more important that Ofcom ensures you can escape unfair price rises on fixed mobile contracts without fear of a penalty.

Ofcom’s aiming to publish its final decision in September and we hope it will listen to the more than 46,000 of you who have supported our Fixed Means Fixed campaign. Ofcom must stick to its guns.

Comments
Profile photo of wavechange
Member

Very reluctantly, I have moved from PAYG to a contract, because I have to phone some mobile numbers during the day and my landline tariff covers only evening and weekend calls to mobiles.

I have chosen a monthly contract so that I can switch provider whenever I wish. I chose Vodafone, simply because that allowed my to transfer the unused credit on my PAYG account. I took the opportunity to say that I did not want a longer contract because they had raised prices mid-contract in the past and told the person I spoke to about the Fixed Means Fixed campaign.

Profile photo of John Ward
Member

The RPI shows that the rate at which retail prices are rising is currently falling so mobile phone companies are probably going to bag their price hikes now in order to lock their tariffs onto a higher floor level.

Member
Carol says:
2 September 2013

I have had a mobile contract with T-mobile for 15 months(of 24) and I recently was encouraged to change and upgrade to EE mobile saying I wouldn’t be charged more. it seemed I would get a better mobile service. for the same price. I have unlimited text phone and web use.( photos cost extra.)
I had an extra £2 added on last month, so this seemed good. What I did not realise was I was charged for the full month and then 2 weeks later charged by EE each at £36. Imagine my shock to find I am having another £36 taken on 15th September 🙂 anyone else had this problem.
i am going to phone them. I feel cheated. It was a phone call from EE staff member intially

Member
Carol says:
2 September 2013

Just spoken to EE customer services and after explaining I have been reassured I will be refunded £26.39 within the next 14 days. So I am much happier.

Profile photo of Haring
Member

Actually, Josh, the latest RPI figure, published on 13 August, is 3.1% not 3.3%. Get your facts right.

The exact definition of RPI might not be know to anybody but economist and statisticians, but anybody who pays cursory attention to the news should have a rough idea, since this measure of inflation has been around in the UK for many decades and it’s level gets reported in the news every month when the latest figures get released.

I do agree that fixed price should mean fixed price, but attacking these mobile phone contracts on the basis that consumers don’t know the exact definition of RPI, one out of multiple measures of inflation commonly used in the UK, or its exact value, given it changes on a monthly basis, it barking completely up the wrong tree.

Please concentrate on the core of the argument that fixed should mean fixed and that potential price increased (however calculated) should not be hidden in the small print!

Profile photo of Josh Green
Member

You’re quite right Haring, at the time of carrying out the research the rate of RPI was 3.3% but it has since changed, as you say, to 3.1%. Duly updated above with the correct figure.

Profile photo of John Ward
Member

I notice today that the retail prices index rose to 3.3% in August from 3.1% in July.

Member
maureen says:
31 January 2014

Exactly that, Haring. Fixed contract should mean a fixed contract, not fixed as long as it suits us. Please keep up the pressure.

Member
Anon the Mouse says:
2 September 2013

Is it explained at point of sale?
Is it clearly legible within the paperwork?
Were you told at point of sale that line costs will increase during the contract?

No!! Well that’s misselling, if it was a PPI you’d have companies fighting over themselves to get you the money back.

If they didn’t explain that costs could increase during the minimum contract then you signed the contract in good faith (legally recognised principal). Raising the costs and pointing to a tiny line in the contract that is too small to even photocopy clearly is breaching that good faith. It is an illegal term under the unfair terms in consumer contracts regulations 1999 and non-enforcable.

Asking for a court date to argue my case with the above information (and case law references to hand) is probably why they instead cancelled my contract without penalty.

Member

How can it be legal for a contract to be changed by one party without the consent of the other party to the contract. It’s absurd. And the time wasting and waffle I got back when I complained was insulting.

Member
Anonymous says:
23 October 2013

this started 3 months ago i noticed my money in my bill account right down , contacted bank vodafone had took 378.00 out of my account, i got in touch , i got intouch over 3 months that many times nearly every day was told a different story by everyone i spoke to i emailed complaints weeks for reply, in the end ive lost nealy 1,000 to them i was on a contract with somthing called vodafone to vodafone , 600mins unlimited txts , ive even cotacted facebook as they said it was them id used internet and games NO1 my phone is 2 old 2 connect but i had to ask everyone i was told 2 try find out what i was paying huge bills for a few days ago i had a off cuff call from coustoerservices as i kept sending eail complaints 2 them , she addmited finaly they had stopted vodafone to vodafone free calls yet never txted me nor emailed nor is it on there web site i have to numbers one mine one my carer has for getting me help im seriously disabled and can ill afford a £1,000 when ive tried months to find out why what was going on now ive no money at all due to them whe i asked why wasnt informed reply we carnt iform every 1 on it i must not be alone in what they have done, she ? me said what id i want well no i was shocked anyone had called i talked rubbish im not gettng my money back oh guesture god will send me a £30.00 phone i dont want and £15.00 , is there any way i can get the vodafoe tovodafone call money back i had a brain hemmorage and a stroke typing this im having 2 ask my aunt and sister what to say /put im now in debt due to them its not like i ignored it 3 months of being told different storys day by day while i was paying more and more 3.87.00 was last bill id asked asked what was going on o one helpted me at all can anyone help me or advise who i could try to get the vodafone to vodafone calls back they stopted without informing me in anyway im so scared upset do not know where to trn please help

Member
RandomCurve says:
15 November 2013

Sounds like they breached GC 11.1 – inform them you will be writing to Ofcom to investigate.

Re mid-term price hikes in general – You may be able to claim back the sums taken from you under these scandalous price rise clause see here:

http://forums.moneysavingexpert.com/showthread.php?p=63754559&posted=1#post63754559

Profile photo of Bonzo4
Member

I think voda phone is ,has been one of the worst company ever 15 years ago it was just the same so my advice is GET OUT as soon as possible.!! They even threatened my Mum with the bailiff’s
she was so frightened when she never had any debit at all .she wasn’t an old biddy at all and strong willed we used to call her Mrs Rotti after the dog !! haa .But my advice is to get out asap please ..

Member
RandomCurve says:
10 June 2014

If you have received the price rise letter from Vodafone – I think you can get out of your contract penalty free:

https://www.facebook.com/pages/Fightmobileincreasescom/396612317147525

Member
RandomCurve says:
2 February 2014

They can’t do this!

I have just won case against EE for doing this – I had to go to the Small Claims Court and EE decided to settle out of court. It is not the extra cost that is unfair, it is the fact that this is just plan greedy and it is not legal. Stand up for your rights. Templates for emails and advice on how to fight this can be found here:

http://forums.moneysavingexpert.com/showpost.php?p=63813901&postcount=29