Business

Switching broadband is too costly, claims watchdog

  • 1 August 2014
  • From the section Business
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Tens of thousands of broadband customers in the UK are having to pay "costly" charges to change supplier, Citizens Advice has warned.

It says the average cost of ending a contract is £190, with some fees said to be as high as £625.

Often consumers are faced with such charges after having received poor service from their existing internet provider, it claimed.

But the internet industry said termination fees are always made clear.

"People are finding themselves held captive by bad broadband services," said Gillian Guy, the chief executive of Citizens Advice.

However, the industry argues that termination charges are necessary, because of the high initial cost of supplying a connection.

"The cancellation policies on contracts generally require the remaining subscriptions to be paid off, and reflect actual costs," said a spokesman for the Internet Service Providers' Association (Ispa).

'Bullying'

In many cases, those who fail to pay the fees are being referred to debt collection agencies.

Brian Ing, a 79-year-old from High Wycombe in Buckinghamshire, tried to switch supplier in March this year, after poor service from his provider.

He was given a bill for £211, which was subsequently passed to a debt collection agency.

Mr Ing had been a customer for seven years, so should not have been liable for termination fees.

"I really got the feeling that they knew how old I was," he told the BBC.

"They started to bully me," he claimed.

Having received a demand for £231 from a debt collection agency, Mr Ing passed the letter to the Ombudsman and Citizens Advice, and the company involved agreed to suspend the charges.

When contacted by the BBC, the provider said it could not comment on individual cases.

'Clear information'

Citizens Advice is asking internet providers to stop cancellation fees when customers have "persistent" problems with their service.

One big provider said it would be happy to comply.

In the meantime the regulator, Ofcom, provides guidance for consumers.

Its guidelines require companies to issue contracts for a maximum period of 2 years.

It says consumers must be given "clear, comprehensible, prominent and accurate" information on termination fees, which can never be greater than the payments they are due to make for the remainder of the contract.

Ofcom says it has made switching broadband provider much easier since the introduction of "migration authorisation codes" (macs), which providers have to give out.

Since the start of the year, customers who wish to switch provider because of an unexpected price rise, must be able to do so, free of charge.

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