BT Price Hike – Why Now?

BT this week announced a hike in the cost of landline rental and daytime calls, a significant blow for consumers at a time when many are struggling to make ends meet. Confused.com’s Stephen Jones takes a closer look and asks: ‘Why choose to raise prices now?’

From 1 October, the cost of using BT’s home phone service will rise for the second time this year. The changes will see line rental increase by 50p from £12.79 to £13.29 per month, while the set-up fee per call will rise 10 per cent, from 9.9p to 10.9p. Call return charges will also be set at 16.5p – up from 4.2p.

If you think this sounds a lot then you’d be about right. BT currently has around 12.5 million customers, many of whom will be struggling to manage their bills already. In fact our own research published recently found that the cost of living has risen by £642.12 in the past 12 months, hitting more than £18,500 a year per household.

With things only likely to get worse as the government raises taxes and cuts benefits, why has BT seen that now is a fit time to further increase the burden?

BT might be the UK’s biggest landline phone provider, but that doesn’t mean they’ve been immune to the cold winds of the recession. In fact, BT has been one of many major companies struggling with a huge pensions deficit, which has seen it embark on a major cost-cutting drive over the last year.

Having said that, the news of the company’s price increases came just two days before they announced a return to profit in the 2009/10 financial year. What’s more, BT is seen by many experts as something of a bellwether for the telecoms industry – meaning many other providers may look to follow suit as a result.

Fortunately, there are ways you can beat price hikes across the industry. Find out who's cheapest for you by comparing home phone providers, and take a look at our top ten ways to cut the cost of communicating and find out how you could significantly reduce your outgoings.

Do you feel robbed by BT’s decision? Fearing further increases to your bills? Let us know by commenting below.