Price increase

[Jonboy55]

Why is there an automatic 3.9% increase in charges?

[Cleoriff]

@Jonboy55 

It's the annual RPI

https://www.o2.co.uk/prices 

[Jonboy55]

Sorry but the increase is RPI +3.9%. My question is, what is the mandatory 3.9% increase for?

[Cleoriff]

@Jonboy55 

If your plan started from 25th March 2021 (RPI plus 3.9%)

RPI is a widely recognised measure of the general level of inflation. Several industries use it as a guide on whether to adjust prices and by how much.

If your plan started from 25th March 2021 (RPI plus 3.9%)

Each year, your Airtime Plan will be increased by the RPI rate of inflation announced in February plus 3.9%. If RPI is negative, we’ll only apply the 3.9%. You’ll see this change on your April 2023 bill onwards.

RPI is a widely recognised measure of the general level of inflation. Several industries use it as a guide on whether to adjust prices and by how much.

If you're an O2 Consumer customer, RPI can impact your Pay Monthly tariff, including your O2 Refresh Airtime Plan (but not the Device Plan), your sim only tariff, standard tariff, mobile broadband tariff and smartwatch tariff.

This year's RPI rate was published on 15 February 2023 and was 13.4%​.

All explained in the link above.

[pgn · Accepted solution]

3.9% is O2's base annual charge, as explained here @Jonboy55 

https://www.o2.co.uk/prices

[Enlli]

OFCOM mandated that the networks were not to charge more than 4% above inflation. Appears they all went as near to the max as possible.

[pgn]

And this from moneysavingexpert website, @Jonboy55 

"O2 has written into contracts that it can increase the price of airtime each year, by 3.9% plus the retail prices index (RPI) measure of the rate of inflation in January (this is usually announced in February)".

It is mentioned in the contract you signed when taking out your Pay Monthly phone and tariff.

[Jonboy55]

Everybody pays a base monthly charge for service supplied. That’s fine. An annual price increase of 3.9%, to some degree is acceptable due to annual costs of running the system. This in my opinion, is just profiteering, 3.9% per annum or the RPI per annum as a price increase, not both. 

[Jonboy55]

I think maybe OFCOM should be taken to task over permitting an automatic pay rise for telecom workers when everybody else has to go on strike.