Question to the Department for Digital, Culture, Media & Sport:

To ask Her Majesty's Government what assessment they have made of contract terms in the new mobile phone market, in particular (1) the fairness of such terms for consumers, and (2) company practices relating to such contracts.

The telecoms regulator, Ofcom, has a statutory duty to further and protect the interests of telecoms consumers.

Ofcom recently undertook a review of the mobile handsets market. As part of that review it identified concerns that some mobile phone customers were not being treated fairly, in particular where they purchase their mobile handset and airtime together in a bundled contract but continue to pay the same price after the end of their minimum contract period (as these ‘out-of-contract’ customers can often save money by moving to a SIM-only deal).

Ofcom has put in place a range of measures to address these concerns, including end-of-contract and annual best tariff notifications which will alert customers when they are out-of-contract and advise them of the best deals available from their provider, including SIM-only deals, as well as a commitment from most of the major mobile providers to apply a discount when customers on bundled deals go out-of-contract.

Alongside these measures, last year Ofcom also secured a set of ‘Fairness for Customers’ commitments from all the major communication providers. These commitments are designed to embed a culture of fairness within the industry. Ofcom will be publishing a report on industry progress against these commitments in Q4 2020/21.