April Price Increase

Matt17

I was paying £25 per month up to April and with a 6.4% increase expected it to rise to £26.60 however it has gone up to £28.84. When I queried this they said my actual bill was £60 with a £35 discount and the 6.4% is applied to the £60 and the £35 discount stays the same.
They say that it is in the contract and so is correct. When I took out the plan it was advertised as £25 per month. It's only when you look into the contract you see it's £60-£35 discount.
To apply the increase to the £60 which works out at 15.4% to what I pay them seems like a sharp practice to me. 

FrugaiMacDugal

Who are you with?

A lot have a £3 increase each March.

MeteredOut

Matt17 said:

I was paying £25 per month up to April and with a 6.4% increase expected it to rise to £26.60 however it has gone up to £28.84. When I queried this they said my actual bill was £60 with a £35 discount and the 6.4% is applied to the £60 and the £35 discount stays the same.
They say that it is in the contract and so is correct. When I took out the plan it was advertised as £25 per month. It's only when you look into the contract you see it's £60-£35 discount.
To apply the increase to the £60 which works out at 15.4% to what I pay them seems like a sharp practice to me. 

You don't say who you're talking about but this is standard amongst suppliers - the increase is applied to the base price excluding any discounts. 

As you've found, this can result in an actual increases significantly above the headline rate reported.

iniltous

Fairly common practice, the discount is fixed £35 , but you are still subject to the ‘list price’ which is what’s subject to the annual increase , but FWIW , that type of inflation plus % increase is no longer allowed , the yearly increases now have to be made clear  in ££’s and pence , not based on a future inflation figure that you can’t possibly know when the contract is struck….they now have to say ( for example) initial price  £35 , in April 2026 this goes up to £38 and in April 2027 it goes up again  £41 , so you know in advance what the increase is and when it’s applied , often the price is per service, so it may be £3 increase for broadband and a further £3 for TV ( for those that take a bundle of services ) .

AFAIK , Virgin ( I suspect that’s who you are with ) didn’t introduce this new method as soon as it was mandated , ( as most other companies did ) they decided to keep the old method until the last possible moment,  which I think that was April 2025 , once you are outside the minimum term you shouldn’t get that type of increase again ,  but there still will be increases, just not based on inflation.
FWIW, I doubt it wouldn’t make much difference to you , under the new system, they would say it’s £60 going upto £63 or £66 or whatever in April 2026 and up again by the same amount April 2027 , then they minus the £35 discount, no one ever increases the discount amount automatically , only the service price 

Matt17

It's Vodafone but it's advertised as £25 and it says CPI + 2.5% so that makes you think the increase is on the £25. You never see mention of £60 unless you read through all the contract. Legally they may be in the right but I think it's very misleading and underhand 

Matt17

iniltous said:

Fairly common practice, the discount is fixed £35 , but you are still subject to the ‘list price’ which is what’s subject to the increase but FWIW , that type of increase is now not allowed , the increases have to be made clear in ££’s and pence , not based on an inflation figure that you can’t know when the contract is struck….they now have to say (for example)  £35 , in April 2026 goes upto £38 and in April 2027 goes upto £41 , so you know in advance what the increase is ….~Virgin ( I suspect that’s who you are with ) didn’t introduce this method as soon as it was mandated , but didn’t introduce this new method as most other companies did , they decided to keep the old method until the last possible moment,  I think was April 2025 

I don't actually mind them using an inflation rise as they clearly said that's what they would do. What I'm not happy about is that they didn't make clear it would be on £60 which is hidden in the contract not £25 that they advertise it at. 

iniltous

I don’t agree with it , but do acknowledge that many companies do it , offer a fixed price discount but the base price is subject to increases , one if the reasons I presumed it was Virgin was the base price £60 , with a near 60% discount to get it to £25 , if a single product , it is presumably not very competitively priced at £60 compared to the competition , in some respects if they advertise £60 when everyone else is around £40 , I doubt any would even enquire to find out it’s overpriced by 60% but they will reduce it by £35 , you feel sorry for the mugs that pay £60, and if everyone gets £35 off , why not just advertise it at £25 

Matt17

Other companies may do it but I don't recall it happening to me before so was a bit surprised. I know we're only talking about a couple of pound a month but it's more the principle of it for me. If they had made it clear it was on £60 I wouldn't have an issue. I believe previous increases have been on the amount I pay so may have just been lucky but this is my first time with Vodafone.
Anyway as you say new rules now on new contracts where it's made clear in £ how much future increases will be. 

Matt17

I've just checked bills after previous increases I've had with plusnet and EE and they have both adjusted the discount so that the increase of CPI + 3.9% is applied to the amount you actually pay. Plusnet even state this in the email notifying me of the increase so fair play to them. That's how it should be.