Citizens Advice responds to Ofcom’s announcement on mobile phones
In response to Ofcom’s announcement on mobile phones Gillian Guy, Chief Executive of Citizens Advice, said:
“Today is a good day for loyal mobile phone customers who will save millions on their contracts each year.
“We submitted a super-complaint back in September as the loyalty penalty is simply unfair - and 89% of people agreed with us.
“Most mobile phone providers have now realised the game is up - they cannot take advantage of their loyal customers.
“Three needs to step up and if it doesn't, then stronger action is needed to make these changes compulsory. If Ofcom is unable to do this, then government needs to intervene."
Citizens Advice submitted a super-complaint on the loyalty penalty - in the mobile, broadband, home insurance, mortgages and savings markets - to the CMA in September 2018 calling for the regulator to consider how the problem can be fixed. The CMA’s response to our super-complaint in December said it agreed and had found damaging practices by firms which exploit unsuspecting customers. The CMA said it wanted to see urgent action.
Research in 2018 by Citizens Advice found that across five essential markets (mobile, broadband, home insurance, mortgages and savings):
British consumers lose £4.1 billion a year to the loyalty penalty (or £11 million a day).
Eight in 10 people are paying a significantly higher price, in at least one of the markets, for remaining with their existing supplier.
The loyalty penalty across the five markets is, on average, £877 per year
This is the fourth super-complaint Citizens Advice has made since being given the power in 2002. Its super-complaint on payment protection insurance (PPI) in 2005 helped to generate a huge win for consumers, with at least £35.7 billion returned to customers in refunds and compensation so far.
Notes to editors
- Citizens Advice includes the national charity; the network of independent local Citizens Advice charities across England and Wales; the Citizens Advice consumer service; and the Witness Service.
- Citizens Advice is the statutory consumer advocate for energy and post. We provide supplier performance information to consumers and policy analysis to decision makers.
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- To get advice online or find your local Citizens Advice, visit citizensadvice.org.uk
- For consumer advice, call the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 to talk in Welsh.
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