Mid-contract price rises: why pounds and pence can cost you more

If you have signed a broadband, mobile or pay-TV deal since the start of 2025, your contract should tell you exactly what your bill will go up by, in cash. That was the point of Ofcom’s clampdown on mid-contract price rises. Two years on, research suggests the switch to pounds and pence has left most customers paying more, not less.

What the rule actually says

Since 17 January 2025, phone, broadband and pay-TV providers across the UK have been banned from writing inflation-linked or percentage-based price rise terms into any new contract. Where a rise is built into the deal, it must be expressed in pounds and pence, shown prominently and transparently at the point of sale, and the provider must be clear about when it will take effect.

The logic was simple. Under the old system, a contract signed in the autumn committed you to an increase set by a figure nobody could know yet — typically the Retail Price Index published the following January, plus a margin of three or four percentage points. Ofcom’s view was that households cannot compare deals they cannot price.

Two details are easy to miss. First, the rules are not retrospective: if your contract predates 17 January 2025, its inflation-linked clause still stands, which is why some bills are still moving with an index. Second, a provider may still sell a contract that allows unspecified rises — but it then has to give you 30 days’ notice and let you leave without paying an exit penalty.

Why the fix may have backfired

MoneySavingExpert published research on 29 June 2026 covering more than 47,000 tariffs sold between April 2024 and March 2026 by the four big mobile networks and five large broadband providers. Its conclusion: three in four customers ended up worse off under cash rises than they would have been under the old inflation-linked terms.

The worked example is instructive. A 3GB Vodafone mobile plan taken out at £10 a month in December 2024 had reached £13.60 a month by April 2026 under flat-cash increases. The same plan under the previous RPI-plus-3.9% formula would have cost £11.40 — roughly 16% less.

The pattern is sharpest at the cheap end of the market, for an obvious arithmetical reason: a flat £1.50 added to a £5 tariff is a far bigger jump than the same £1.50 on a £40 one. The study found rises of around 31% on low-data 1GB mobile plans against 7.3% under the inflation model, and about 22% on entry-level broadband against 7.1%. It is the same regressive logic that makes fixed costs so contentious elsewhere — the reason we looked at standing charges on energy bills, where the smallest users carry the heaviest share.

The discount most eligible households never claim

There is a cheaper tier most people never see. Social tariffs are low-cost broadband and mobile packages for households on Universal Credit and certain other benefits, with prices advertised from around £12 a month. Ofcom expects them to come with price stability, no early exit charges and minimal upfront costs, and most providers keep social tariff customers out of the annual rises altogether.

Take-up remains tiny. Ofcom put it at 532,000 households out of roughly 6.2 million receiving Universal Credit — about 8.6% of those eligible. The gap matters more when budgets are tight, something the monthly reading of consumer confidence has been tracking all year. Moving to a social tariff does not usually mean waiting for your contract to end.

What is happening further upstream

Retail prices are not the only front. In late September 2026 Ofcom ordered Openreach to withdraw a new discount offer on full-fibre lines, on the grounds that cut-price wholesale terms could squeeze rival network builders. Days later, the Competition and Markets Authority raised competition concerns about a £2bn deal between nexfibre and Netomnia. Both decisions concern the plumbing of the market rather than your monthly direct debit, but the wholesale price a provider pays eventually reaches the retail shelf.

A short check on your own bill

• Find the date you signed. Before 17 January 2025 means an index-linked clause may still apply.
• Read the rise as a cash figure over the full term, not a monthly one: £1.80 a month is £21.60 a year.
• Check your end date. Out of contract, there is nothing to stop you moving, and no exit fee.
• Test eligibility for a social tariff before assuming the standard price is the floor.
• If a rise was not set out in pounds and pence at the point of sale, you may have a penalty-free exit. Ask for it in writing, and keep the same discipline you would apply to any consumer offer whose small print has changed.

Transparency has clearly improved: the number in front of you is now a number. Whether it is a smaller number is a different question, and for most tariffs the evidence so far says it is not.

Frequently asked questions

Does the pounds-and-pence rule apply to my existing contract?

Only if you signed on or after 17 January 2025. Older contracts keep the terms they were sold with, including inflation-linked clauses, until they end.

Can I leave if my provider raises the price?

If the increase was clearly set out in pounds and pence before you signed, it is part of the deal and there is no automatic right to exit. If the contract allows unspecified rises, you must be given 30 days’ notice and the right to leave without a penalty.

Who can get a social tariff?

Households receiving Universal Credit and, with several providers, other benefits such as Pension Credit or Employment and Support Allowance. Availability depends on the provider serving your address, so check with yours directly.

Sources

• Ofcom — Ofcom bans mid-contract price rises linked to inflation
• MoneySavingExpert — research on mid-contract price rise protections
• ISPreview UK — a quick guide to UK social tariffs

This article was written with the help of artificial intelligence. Editorial policy