Martin Lewis Accuses Ofcom of Failed Action on Mobile Price Hikes: MSE Study of 47,000 Tariffs

What Ofcom's New Rules Changed

In January 2025, Ofcom replaced the previous approach to mid-contract mobile and broadband price hikes - under which providers could raise prices by inflation (CPI or RPI) plus up to 3.9% each year - with a new system requiring providers to state, in pounds and pence, exactly how much prices would rise when a customer signed up.

The principle behind the change was straightforward: consumers deserved transparency. Knowing that your £25/month broadband bill would rise by £3 in April was clearer than being told it would rise by CPI plus 3.9% when you had no idea what inflation would be.

The problem identified by MSE is that while the new rules improved transparency, they did nothing to limit the size of the increases - and in practice, providers set those increases above what customers would have faced under the old system.

What the MSE Study Found

The structural problem MSE identified is that pounds-and-pence pricing hits those on cheaper tariffs disproportionately hard. A £4 monthly increase on a £20 tariff is a 20% rise. The same £4 on a £60 tariff is 6.7%. Those who chose cheaper contracts to keep costs down face the steepest percentage increases.

MSE found that in almost all cases analysed, customers faced above-inflation price rises under the new system. UK CPI inflation peaked at 3.8% in summer 2025 and had fallen to around 2.8% by spring 2026, yet mid-contract price rises under pounds-and-pence rules frequently exceeded these rates.

Martin Lewis: Scrap the Rules

Martin Lewis responded to the MSE findings, describing the outcome as frustratingly predictable. His position is that the rules should be scrapped and replaced with a ban on above-inflation mid-contract price hikes.

He acknowledged that a complete ban on any mid-contract rise risks market distortion - providers might respond by raising initial prices as a provision against unexpected costs. A ban on rises above inflation, he argued, would serve as a straightforward compromise that would have resulted in lower increases for over 99% of customers had it been in place instead of the current transparency rules.

Lewis is giving evidence to the House of Commons Public Accounts Committee on 29 June 2026, as part of a session examining costs for consumers across broadband, water and energy.

The Telecoms Charter: An Improvement, But Gaps Remain

In February 2026, the government brought together Ofcom and providers to agree a Telecoms Consumer Charter in response to concerns about mid-contract price hikes. Lewis described the charter as an improvement within the narrow range of issues it addresses, but flagged two gaps:

• Transparency does not stop rises: Firms that follow the rules must now tell customers in pounds and pence how much prices will rise, but the rules set no ceiling on the size of the increase
• Variable pricing loophole: Sky continues to operate on a variable pricing basis, allowing mid-contract price changes with a 30-day notice period and the right to leave. In practice, many customers only notice the increase once it hits their bill rather than when the notification arrives

What Customers Can Do Now

Until rules change, practical steps for mobile and broadband customers:

• Check your contract for the stated mid-contract price rise amount before signing - providers are required to show this under current Ofcom rules
• Compare the total cost over the contract term, not just the headline monthly price
• Note whether the provider uses fixed pounds-and-pence rises or variable pricing (Sky model)
• If your price rises mid-contract under a variable pricing arrangement, check whether you have a 30-day window to exit penalty-free
• At end of contract, compare deals using Ofcom's comparison tool at ofcom.org.uk or third-party comparison sites
• Social tariffs are available for those on eligible benefits from most major providers - check availability at ofcom.org.uk/phones-and-broadband/saving-money/social-tariffs

What did Ofcom change in January 2025?

Ofcom replaced the old inflation-linked mid-contract price rise system (CPI or RPI plus up to 3.9%) with a pounds-and-pence transparency regime. Providers must now state at sign-up exactly how much prices will rise mid-contract, in pounds and pence. The new rules do not limit the size of the rise - only its disclosure.

Are most people worse off under the new Ofcom rules?

According to MSE research covering 47,000 tariffs, three in four contracts are more expensive under the pounds-and-pence system than they would have been under the old inflation-linked model.

Why are people on cheaper tariffs hit hardest?

Because price rises are often a fixed pounds-and-pence amount. A £4 monthly rise on a £20 tariff is a 20% increase. The same £4 on a £60 tariff is 6.7%. Those who chose cheaper contracts to keep bills low face a disproportionate percentage impact.

What is Martin Lewis calling for?

A ban on above-inflation mid-contract price hikes. He argues this would have been a simpler and fairer rule than the current transparency-based approach, and would have resulted in lower bills for over 99% of customers analysed.

What is a social tariff?

A discounted broadband or mobile deal offered to customers on qualifying benefits such as Universal Credit or Pension Credit. Most major providers offer them. Prices typically range from £10 to £20 per month. Check eligibility via ofcom.org.uk or directly with your provider.