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Catherine Furze

5 ways you may be able to cut your broadband bill ahead of spring price hikes

Millions of families are just weeks away from price increases of up to £95 a year as broadband providers get ready to hike the bills from late March onwards.

Many broadband and mobile providers hike their prices each year to combat the inflation rate and rising business costs. In a quirk of broadband and mobile phone contracts, they can even do this if you’ve agreed to a fixed monthly direct debit for your contract period and you are still in that contract.

Because the inflation rate is so high right now, monthly prices for millions of broadband and mobile customers are are a lot higher than normal, increasing by up to 17% — not the most welcome news during a cost of living crisis and at the same time that energy costs are due to rise by around £500 a year for the average household.

Read more: Seven signs that mean your broadband call may be a scam

Taking the 14.4% increase rate that providers like BT, Plusnet, Vodafone and EE are implementing, this could increase your costs by an extra £34.56 if you currently pay £20/month and £60.48 if you pay £35/month. The picture looks even worse for Virgin and O2 customers, whose price rises are tied to the RPI rate of inflation, which could mean a price increase of 17.3% for customers of these mobile networks.

According to This Is Money, typical broadband deals range in price from £22.99 to £55 a month, meaning many homes will pay £3.31 to £7.92 extra a month for their internet. That adds up to between £39.72 and £95.04 a year.

Mid-contract price rises usually take place once per year, and they're roughly tied to the inflation rates published each January. There are two inflation rates that providers use to determine their price increases: Consumer Price Index (CPI): 10.5% in January 2023 and Retail Price Index (RPI): 13.4% in January 2023. Many providers also add their own set amount of about 3% to their price rises.

Broadband providers tend to make their price rises effective at the end of March or beginning of April, but they usually announce them several weeks beforehand, giving customers time to work out if they would be better moving elsewhere, even if they have to pay an exit fee to get out of their contract. If your contract is coming to an end, or even if your contract ends in a few months' time, it could well work out better to switch to a cheaper broadband deal now. If the monthly price of your next deal is low enough, you might end up paying less overall.

If you are already out of contract, you are free to move without any penalty.

Not all broadband and phone firms will increase prices this year, and not all tariffs will go up significantly, but some homes do face significant tariff changes. If you're one of them, there are a number of ways to drive down the price of your broadband deals

1) Work out what you're paying for now

It sounds obvious, but many households are not familiar with what they are paying and what they get for their money. If you have had broadband for a while, you may not know what connection speed you have or the length of the original contract. If you pay for a 'bundle' from a firm such as Sky or Virgin Media, you may not even know exactly how much your broadband costs every month.

If it's not easy to work out, ask your supplier, and while you are there, enquire about your contract length. If you have had broadband with your current supplier for more than 18 months, the then chances are you will no longer be tied into a contract, as most last 12 or 18 months.

2) Work out what you really need

There is a great deal of variation with broadband deals, mostly depending on speed and download limits, which affects their price. If you are an avid internet gamer living with a serial box set downloader, you probably don't need a high-cost service with unlimited downloads and top speeds. Picking a broadband deal that suits your needs will save you money, so keep that in mind when you are considering different channels, calls packages and add-ons.

3) Shop around for the best deal

If you are at the end of your contract, haggle for a better deal with your supplier. Broadband providers are battling to sign up new customers, and according to a Moneysavingexpert.com poll, Virgin Media and Sky are the top firms to haggle with, with over 80% of those who tried negotiating having some success. If you have come to the end of your contract and threaten to leave they may offer you a better deal in return for signing a new contract with them.

4) Know your rights

You can leave your contract without paying an exit fee under certain circumstances. For example, if your provider announces a price increase that was not in your contract, you are allowed to cancel and find a better deal. And if your broadband speed is below your provider's promised minimum, they have one month to fix the situation or you can leave with no penalties.

5) Check if you can get a social tariff

Social tariffs are cheap broadband deals for people on benefits. These deals have existed since 2020, when industry regulator Ofcom told providers give low-cost options to the most hard-up customers, and this year most providers have excluded social tariffs in their price hikes. Suppliers such as EE, Vodafone and Virgin media typically offer basic broadband for around £12 a month. Best value is Vodafone Essentials Broadband, which offers 38MB/S for £12 a month.

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