Almost 6m UK households ‘struggling to pay telecoms bills’

Which? says people are cutting food and clothes spending to pay for mobile, broadband and landline

Almost 6 million UK households are struggling to pay their mobile, landline and broadband bills, with the cost of living squeeze forcing many to cut back on essentials such as food and clothes, cancel or change a service, or miss payments to stay connected.

A report from the consumer group Which? estimates that 5.7 million households have experienced at least one “affordability issue” in April, as cash-strapped homes struggle to cope with soaring bills and other costs.

Consumers are increasingly coming under pressure from the cost of living crisis – inflation is at a 40-year high and energy bills are forecast to soar to £3,600 annually this winter – more households are finding it harder to afford the essential telecoms services they previously took for granted.

Analysing data from the regulator Ofcom, Which? found that 3.5 million homes reduced spending on other essential items such as food and clothes in April to afford their telecoms bills. This is up from 2.2 million in February.

“The fact that millions of households have made sacrifices to prioritise their broadband and mobile connections during the cost of living crisis demonstrates just how essential these services are for day-to-day modern life,” said Rocio Concha, the director of policy and advocacy at Which?.

The affordability crunch is disproportionately affecting those on the lowest incomes: households with an annual income of up to £25,999.

The report found that 22% of lower-income households were forced to reduce spending elsewhere to afford connectivity services in April. This figure was 13% among middle-income homes – those with an annual income of £51,999 – up from 7% in February.

Which? said the government should cut the 20% VAT rate on telecoms bills to 5%, in line with other essentials such as gas and electricity. The organisation points out that even the most financially vulnerable customers, those eligible to be on specially discounted social tariffs, are charged 20% VAT.

“To help cut bill costs, the nextprime minister should reduce the VAT paid on telecoms in line with other essential services,” Concha said. “Businesses must support anyone struggling to afford their bills and ensure consumers are aware of and able to access the best deals.”

Sign up to the daily Business Today email or follow Guardian Business on Twitter at @BusinessDesk

Earlier this year, the UK’s biggest telecoms companies increased bills by almost 10% – the consumer prices index rate of inflation in January plus 3.9%. While telecoms companies came in for some criticism for pushing through this year’s rise, it came before inflation hit a 40-year high and the real impact of soaring food and energy prices had begun to be felt by households.

Last week, BT said higher prices for broadband and mobile phone contracts helped the company return to sales growth in the first quarter. It pledged to continue to implement above-inflation increases next year to cover rising costs and investment in rolling out fibre broadband across the country.

In June, the UK’s biggest mobile and broadband companies – including BT, Virgin Media O2, Vodafone, Three, Sky and TalkTalk – agreed a plan at a government-led summit to help customers struggling to pay bills, including moves to allow switching to cheaper deals without paying a penalty.


Mark Sweney

The GuardianTramp

Related Content

Article image
UK telecoms industry agrees plan to help struggling customers
Mobile and broadband firms make number of commitments amid cost of living crisis

Mark Sweney

27, Jun, 2022 @5:47 PM

Article image
Record 8m households in UK struggle to manage telecoms bills, says Ofcom
Regulator calls on sector’s big players to scrap formula that uses inflation plus 3.9% to set annual price rises

Mark Sweney

28, Sep, 2022 @11:01 PM

Article image
Ofcom forces telecoms firms to tell customers about better deals
More than 20m people could save 20% on landline, mobile, broadband and TV packages

Mark Sweney

15, May, 2019 @12:27 PM

Article image
Mobile and broadband prices: UK watchdog reviews inflation-busting rises
Ofcom could implement tougher protections against hefty bill increases midway through contracts

Mark Sweney

09, Feb, 2023 @10:36 AM

Article image
Telecoms firms investigated for failing to warn UK customers of price rises
Ofcom inquiry follows complaints over lack of information on annual mid-contract price rises

Mark Sweney

01, Dec, 2022 @12:17 PM

Article image
One in seven consumers in UK paying ‘loyalty penalty’, says charity
Citizens Advice says people should consider switching products such as mobile and broadband contracts or mortgages

Sarah Butler

01, Aug, 2022 @6:01 AM

Article image
Millions in UK struggling to pay internet and phone bills, says Ofcom
Regulator says some users have cut food spend to pay telecoms bills during Covid crisis

Mark Sweney

18, Dec, 2020 @1:10 PM

Article image
Stop UK mobile and broadband firms ‘lining their pockets’, urge consumer experts
Companies facing backlash amid warning of mid-contract price rises up to 17% during cost of living crisis

Jon Ungoed-Thomas and Miranda Bryant

05, Feb, 2023 @6:00 AM

Article image
Mobile, broadband and pay-TV customers could save £1bn on bills
New Ofcom rules will force companies to offer the best deals when contracts end

Mark Sweney

14, Feb, 2020 @7:09 AM

Article image
Broadband customers face up to 14% hike in bills, warns Which?
BT customers face £113 rise as providers such as EE and TalkTalk prepare controversial ‘inflation-plus’ mechanism

Mark Sweney

14, Oct, 2022 @11:01 PM