Call for crackdown as TV, phone, and broadband prices set to soar again
The Competition and Consumer Protection Commission wants 'changes to the law or regulation' to protect consumers as prices are set to rise again in April.
The Government needs to crack down on companies that are hiking bills for essential services mid-contract, the consumer watchdog has said.
The call from the Competition and Consumer Protection Commission (CCPC) comes as household budgets are to be stretched even further next month with Eir, Sky, Three, and Vodafone all hiking TV, mobile, and broadband prices.
Energy bills and insurance costs are also set to follow suit in the months ahead.
“This is the third April in a row that many of the main telecommunications providers will hike their prices,” said Daragh Cassidy of the price-comparison website bonkers.ie.
He said the providers are implementing “annual price adjustments”.
Initially, this price adjustment was based on the annual rate of inflation plus an additional 3% each April.
However, Eir and Vodafone have now reverted to fixed annual increases, with Vodafone’s broadband plans increasing by a flat €3.50 a month each April going forward and TV plans increasing by €4.50.
Sky said it does not have fixed annual adjustments, but its prices will increase by 4.5% on average next month following an increase in the previous two Aprils.
In a statement, a Sky Ireland spokesperson said: “We know price increases are never welcome and have tried to keep this increase as low as possible by absorbing costs where we can, while still providing our customers with as much value as possible.”
Vodafone said there are annual price adjustments on customers’ services and they exist to “enable Vodafone to respond to changes in our cost base and to invest in network upgrades”.
Bonkers.ie has claimed the price increases are controversial as they amount to “price signalling” under the definition provided by the CCPC.
On its website, the consumer watchdog says: “Price signalling occurs when businesses make their competitors aware that they intend to increase prices.
“Price signalling can happen in public, through announcements or comments on prices, or in private through direct contacts between companies.
“If a business knows that their competitor is increasing prices then they may be encouraged to also increase prices, since their customers are less likely to move to their competitor.
“Price signalling is against the law.”
The CCPC told the that it examined how price increases in the telecoms industry were communicated to see if there was any evidence of price signalling.
“We didn’t find grounds to pursue a price-signalling investigation under competition law,” said the watchdog.
“However, we were seriously concerned about the impact of these mid-contract price increase clauses on consumers.
“Telecoms contracts are an essential part of daily life and consumers need to be able to easily understand the costs they are signing up to, both at the start of a contract and into the future.
“We intend to write to the relevant minister about this.”
The hike in internet and TV prices comes as households are still being disproportionately affected by higher inflation in some areas.
According to the most recent consumer price index from the Central Statistics Office, house insurance has risen 7.5% in the last year and car insurance has increased 11.1%.
This is despite the general rate of inflation being at just 1.8%.
Households have also been warned to expect higher energy bills after SSE Airtricity recently announced that it would be hiking its prices from next month, citing increases in external costs including network charges and wholesale costs.
This move sparked concerns that other gas and electricity suppliers will follow suit in the weeks and months to come.
The last wholesale price index put electricity prices 67.7% higher now than 12 months ago.
