Millions of the most financially vulnerable could be missing out on hundreds of pounds a year because many providers are not advertising cheaper social tariffs on their social media regularly or when customers sign up for services, Which? has found.
Which? research found that those customers who are eligible for a social tariff could save an average of £250.32 per year – £20.86 a month – by switching from their current broadband deal to the cheapest social tariff.
Eligible customers of some providers could make even bigger savings. The average Hyperoptic customer could save £344.16 annually by switching to the firm’s cheapest social tariff, while the average Virgin Media customer would save £321.60 and BT customers could save £284.52.
However, part of the reason Hyperoptic and Virgin Media customers have the largest potential savings is that the providers offer some of the fastest speed connections on their standard tariffs, while they also offer some of the cheapest social tariffs available.
NOW Broadband and Sky customers stand to make smaller savings of £128.16 and £224.04 respectively.
Social tariffs are special discounted deals available for certain low-income customers. However, many broadband customers are unaware they could be eligible.
In February 2022, Ofcom warned that only 55,000 out of an estimated 4.2 million eligible households had signed up to social tariffs. It called on providers to do a better job of promoting social tariffs, making information about them clear and the sign-up process as easy as possible for eligible customers. It has also urged providers that do not currently offer a social tariff to do so.
During May 2022, Which? checked the Facebook, Twitter and Instagram accounts for the seven broadband providers that offer social tariffs – BT, G.Network, Hyperoptic, KCOM, NOW Broadband, Sky and Virgin Media – to see if they were advertising the availability of social tariffs on their social media accounts.
The consumer champion found that only one provider had made any mentions of social tariffs on their social media in the month of May. KCOM had two tweets and one Facebook post which mentioned social tariffs.
Which? also looked at whether any of the providers asked customers if they receive any benefits, such as universal credit, when they were signing up for a new deal – which is not a social tariff – and found that none did so up until check out during the sign-up process.
Says Rocio Concha, Which? Director of Policy and Advocacy:
“It is unacceptable that broadband providers aren’t doing more to make customers aware of social tariffs – meaning millions of households who may be struggling to make ends meet could be missing out on hundreds of pounds of savings.
“During a cost of living crisis, broadband providers must support the most financially vulnerable by clearly promoting discounted deals and making it easy for eligible customers to switch over to social tariffs.”
Which? also believes that to help cut bills during the cost of living crisis, the government should reduce the amount of VAT paid on telecoms from twenty per cent to five per cent. The consumer champion estimates that a reduction in VAT could save those on a standard broadband tariff up to £57 a year, and those on a social tariff up to £37.50 a year.
Adds Catherine Hiley, broadband expert at Uswitch.com:
“Broadband is well-established as an essential utility and low-income households should not have to sacrifice this to free up cash for other needs. Broadband social tariffs can help alleviate that pressure, but only if they are reaching people effectively.
“We have already seen some of the biggest broadband providers, such as Sky and BT, introduce social tariffs, with mobile operators like Vodafone’s SIM-only network VOXI also weighing in to help financially vulnerable customers.
“But it is disappointing to see that broadband providers still aren’t promoting these to the right people – and our own research backs this up.
“Uswitch recently found that two-thirds of low-income households are unaware that broadband social tariffs even exist. That’s roughly ten million homes.”