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Labour reveals broadband help plan

October 14, 2022

By Colin Mann

As UK family bills rocket as a result of the economic crisis, the opposition Labour Party is calling on the government and Ofcom to stop a broadband bombshell hitting families and firms with a three-point plan to rein in expected broadband price increases and ease the cost-of-living crisis.

Ofcom reports that nearly a third of households (8 million households) are having problems paying for their broadband, phone and streaming bills, double the number last year, and the highest since their records began. In a recent Lloyds Bank survey, 26 per cent of adults not using the internet in the past three months gave “it’s too expensive” as a reason. At the same time, 97 per cent of eligible low-income families are currently missing out on a social tariff. Meanwhile, it has been reported that broadband firms are in line for a £1.7 billion windfall as a result of above inflation price rises.

Labour is calling for:

  • A reversal of changes the government made in 2019 which allowed regulated wholesale prices to rise with CPI rather than costs, so that telecoms wholesalers and internet service providers don’t get a windfall from sky high inflation whilst families and firms struggle to pay their bills.
  • Ofcom to investigate and take action to strengthen consumer protections including taking action on mid contract price rises, early termination costs for social tariff customers, and loyalty penalties where long term customers pay more than new customers.
  • An industry wide social tariff for low-income families. Industry including wholesalers like Openreach, must work with Ofcom and consumer groups to develop a mandatory well-advertised broadband social tariff for low-income families, or the Party will set and legislate for one in government.

According to Labour, broadband is the newest utility, an essential for everyday life, not a luxury. “Yet the Conservative cost of living crisis means that many families are finding Internet access increasingly unaffordable, or impossible. Without access to the online world, children can’t do homework, parents can’t access the labour market, social security, or the best rates for services or goods, and grandparents can’t stay in touch face to face with family over distances,” says the Party.

“Broadband wholesale price increases used to be capped at costs with prices stable over many years. However, in 2019, the government changed regulation so the price of existing Openreach networks could increase in line with CPI inflation instead. Wholesale prices for 2023 will be set this October with inflation estimated to reach a peak of 13 per cent. As a result, it has been reported that broadband bills could increase by a quarter,” it notes.

“Internet access is a necessity not a luxury, yet the economic crisis made in Downing Street is making it increasingly difficult for families to make ends meet and stay connected,” states Lucy Powell MP, Labour’s Shadow Secretary of State for Digital, Culture, Media and Sport.

“Our three-point plan will ease the broadband bombshell facing families and firms, at a time when they are already facing eye watering energy bills, and mortgage and rent increases. Whilst the Conservatives crash our economy, Labour will ensure accessing and connecting to digital infrastructure powers growth across our economy to ensure people and places aren’t left behind.”

Categories: Articles, Broadband, Business, ISP, Policy, Regulation, Telco

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