MSE News: EE to increase monthly prices by 4.1%

sully1311

Kim_13 wrote: »

I assume the basis they use is that a 12 month sim only is offered at a cheaper price than an equivalent deal on 30 day rolling, so if customers were allowed to leave they'd effectively have had a discount without having to 'lock in' for a minimum period.

It's in the terms of the contracts that RPI increases now happen every year. It's not something I agree with so I am voting with my feet and will not sign a contract with such terms.

All four of the major phone companies do this.

Protopia

According to this web page ( http://ee.co.uk/.../ee-price-plans/pricechanges-june-2017) they last put up their prices in June 2017 based on an RPI increase of 3.1 as measured in April 2017.

So when they now put their prices up in April 2018 based on RPI in January 2018, they are using a full year's RPI increase between price rises that are only 9 months apart.

Is this legal?

If not, what can we do about it?

boatman

Protopia wrote: »

According to this web page ( http://ee.co.uk/.../ee-price-plans/pricechanges-june-2017) they last put up their prices in June 2017 based on an RPI increase of 3.1 as measured in April 2017.

So when they now put their prices up in April 2018 based on RPI in January 2018, they are using a full year's RPI increase between price rises that are only 9 months apart.

Is this legal?

If not, what can we do about it?

As far as I aware the EE RPI increase happened at the end of March, not June. Is that notice you have linked to for out of bundle charges perhaps, bit strange, how did you find it?

Oxy1

If you set up a site and start selling gold bars yet in your terms and conditions state they are actually yellow metal and not gold - then, unless you are EE or the like:
1. You will be done for fraud,
2. The fact that you tried to make your fraud look legitimate by putting it into terms and conditions is likely to be viewed as an aggravating feature of the crime demonstrating extra planning and contempt.

They display the cost as £XXX per month. It is just not sufficient to mention the fact that it is not in fact £XXX per month but in fact more somewhere in terms and conditions. They have to advertise it as £XXX+inflation per month.

In fact, even if they described it as £XXX+inflation it would not be sufficient as:
1. You might have joined this racket on 5th of February 2018 and yet they would seek to bump your prices by 4%+ in just two months. This is not inflationary increase! This is a LOT more!
2. In case of negative inflation would there be a negative increase i.e. a decrease? Somehow I think not - in which case it is not really inflationary increase - it is a ratchet.
3. RPI we are being told exaggerates inflation and is incorrect measure. We are being told by government CPI is the correct measure, so they really seek to increase by more than inflation, even for hose who joined more than a year ago.

From basic fairness (relevant to another possible challenge with regard to Unfair Terms in Consumer Contract):
1. The contracts are short term. So, say, 50 years or perhaps even 10 year contracts for business sense would have to have some sort of inflation linkage. These, however are short contracts of 12-24 months. Inflation linkage within 1 year is totally absurd (and you could be getting it if joined them in the last year!) and even for 24 months there is just no need for it. They could have hedged any inflation risks (such as hyperinflation blow-out) very easily and inexpensively using inflation swaps and incorporated into a (clearly displayed) monthly price at inception.
2. They do not apply the increase to Pay as You Go deals, that proves it does not reflect a general increase in prices for the relevant services but opportunistic racket up of prices.
3. If you are on a contract with them, it is more of a financing deal for a handset rather than a payment for service. Which means even if there is inflation blow-out they should not really suffer as:
1. they bought the handset when you joined at the prices back then. Their suppliers will not be asking for more money due to inflation since they purchased handsets.
2. cost of financing this purchase is not linked to inflation and was easily fixable and known at the time of entering into contract as fixed interest rate loans are commonly available, and in fact usual for short term borrowings. So the attempt to bump prices in case of inflation is an attempt to opportunistically profiteer from misfortune rather than an attempt to pass on increased costs.

If you can - I would urge you to leave as a matter of principle. If you can't consider complaining to: executive.office at ee co uk . Myself, I intend to take legal action against EE in County Courts.

BogsDollox

Glad I let my SIM only plan run past the minimum contract term, phoned them as soon as I received the RPI e-mail this morning, got the same plan, with extra data, for half the price, with no RPI increase

:beer:

Definitely worth giving them a call.

MKB

This is a scam by EE, pure and simple.

My monthy SIM-only contract is for £14.99, made up of a notional £28.99 package with a £14 discount applied.

They plan to increase my monthly cost by £1.19 or 7.9%, because they are applying the RPI to the notional total not to the amount I am actually contracted to pay each month.

I shall be challenging if necessary. The EE complaints procedures say:

If after contacting us we have not resolved your complaint within 8 weeks or if there is a deadlock situation, you may refer your complaint to Ombudsman Services, free of charge. Deadlock arises when we believe we have done everything we can to resolve your complaint but can!!!8217;t reach an agreement with you. You must have followed our escalation process before deadlock will be considered and we will be unable to send a deadlock letter if we are still working to resolve your complaint or if your complaint falls outside the remit of Ombudsman Services. Ombudsman Services is an independent dispute resolution scheme, approved by Ofcom. Please ensure that you read Ombudsman Services guidelines to ensure that your complaint satisfies the conditions for referral. http://www.ombudsman-services.org/communications.html When your complaint goes through Ombudsman Services, an independent assessor will review your complaint and make a decision about how to settle it.

Details of the service are available by contacting us or Ombudsman Services directly:

Ombudsman Services
The Brew House
Wilderspool Park
Greenall's Avenue
Warrington
WA4 6HL

Website: http://www.ombudsman-services.org/communications.html

EU Online Dispute Resolution Platform

From the 15 February 2016, customers who purchase their device or contract online can use the Online Dispute Resolution (ODR) Platform to register a complaint. The ODR is an EU Alternative Dispute Resolution (ADR) procedure which signposts a customer to the relevant ADR provider for their complaint. EE is a member of the Ombudsman Services Scheme as referred to above. Should the nature of the complaint be one which is covered by the Ombudsman Services Scheme the ODR portal will refer you to Ombudsman Services Scheme. You are not required to use the ODR Portal. You can approach Ombudsman Services directly. To apply to the ODR platform an online form needs to be completed and submitted. Further information on ODR and the form can be found here.

Does anyone know which of the two ombudsman services is most likely to be helpful.

boatman

http://www.ombudsman-services.org/communications.html

This the one EE use.
https://www.ombudsman-services.org/company-directory/communications/e

Oxy1

BogsDollox wrote: »

Glad I let my SIM only plan run past the minimum contract term, phoned them as soon as I received the RPI e-mail this morning, got the same plan, with extra data, for half the price, with no RPI increase

:beer:

Definitely worth giving them a call.

Which proves that the whole "inflation thing" is just a scam. The prices are not really increasing in the market. For those of us in a contract who will be pursuing complaints with ombudsmen it is one of the points to make.

sully1311

Does anyone actually have the OFCOM rules regarding RPI increases?

I think it's a bit of a grey area of RPI increases on the original price of the plan and not the actual/discounted price?

Oxy1

boatman wrote: »

Thanks a lot! Makes perfect sense to complain to Ombudsmen as, unlike with Courts, there is nothing at all to loose by complaining. Instead of pursuing County Court Claim against them (which is not for everyone) I will complain to the Ombudsmen first.

So there is nothing to loose at all by complaining to the ombudsman and the steps are:
1. Write to EE first for example by email to executive.office at ee dot co dot uk . A couple of emails or so and you will get a deadlock letter from them which will allow you to take matter to the Ombudsman.
2. Complain to Onbudsman using the above links.

The points I will be using in my complaint:
1. The price was agreed explicitly and it was not brought to my attention that it is subject to increases. (If some issue is not discussed / shown to you before or at contract completion then you could be bound by terms written in the contract provided they are not fair. But if some issue was explicitly discussed / shown to you, such as price per month, they can not rely on something hidden in terms and conditions to override it. In effect what they had shown explicitly is part of the terms and can nor be easily overridden by some hidden terms.)
2. The price rise is also not fair as it:
a. applies full years inflation increase to everyone - even those who joined less than a month ago. So clearly is above inflation.
b. Uses exaggerated inflation measure RPI instead of CPI.
c. Given that Pay as you GO prices are not increased, as well as prices for those out of contract are actually reduced routinely upon complaint there is no genuine market price increase.
d. For those in the contract the payments are more of a finance contract rather than a service contract as you are essentially repaying the price of your phone as is easily observed by the price difference between phone and sim-only contract prices. If you have a mortgage or a credit card your balance or repayments do not increase rapidly because of inflation. Indeed the cost to them of financing your phone is likely to fixed interest as it is usual for such short term loans to be fixed cost.
e. There is no genuine business reasons for such terms in short term contracts. If the contract was for 100 years or at least there could be a valid and genuine business reason for the company to be able to raise prices. For so short term contracts as 12-24 months their exposure to inflation risk on the financing part of the contract (the one that relates to repayment of handset cost) is just non-existent (the manufacturer will not ask them for more money for the handset! and if the used a loan to buy it fixed rate short term business finance is readily available). Their exposure to inflation on the smaller, service part of the contract is quite small and can easily and cheaply be managed through financial instruments such as inflation swaps. The real reason for these terms is to deceive the consumers by presenting a lower per month cost in their advertising and sales pages then the one they intend to charge and by doing so procure an unfair advantage of the competition and defraud consumers.