UK ISP Plusnet Joins BT and EE in CPI + 3.9% Price Hike Change UPDATE

In a predictable move UK broadband ISP Plusnet has today gone the same way as their parent (BT) by announcing their intention to hike prices, which will see future increases on contracts taken on or after October 7th 2020 being calculated by the Consumer Price Index (CPI) rate of inflation plus an additional 3.9%.

Prior to this change Plusnet’s official policy was to merely increase their prices in line with the CPI rate, as published by the Office for National Statistics in April this year (1.5%). The addition of an extra 3.9% on top of CPI is thus a significant change, albeit one that seemed inevitable after BT and EE announced the same approach last month (here).

Naturally if you’ve signed up to one of their fixed price contracts and you’re still within your minimum term then this won’t impact you until after that term comes to an end. Otherwise the ISP states that their broadband, line rental, call plans and some call charges will go up in price in line with CPI plus 3.9% on or after 1st June 2021 and then on or after 1st March every year from March 2022.

For any customer who joins or takes a new contract on or after 7th October 2020, early termination charges will also increase in line with CPI plus 3.9%.

Plusnet’s CPI Guide Statement

How will the CPI plus 3.9% price increases work?

On or after 1st June 2021 we’ll take the CPI percentage rate published by the Office for National Statistics in April of that year and add an extra 3.9% to the rate. We’ll increase the monthly price of broadband, line rental, call plans and call charges by the total percentage figure.

On or after 1st March every year from March 2022, we’ll take the CPI percentage rate published by the Office for National Statistics in January of that year and add an extra 3.9% to the rate. We’ll increase the monthly price of broadband, line rental, call plans and call charges by the total percentage figure.

If the published CPI percentage rate is negative, we’ll only increase your prices by 3.9% in the relevant year.

The calculated increase will be rounded up to the nearest whole pence.

Where you buy more than one service from us and each is subject to the price increase, the amount of the increase is calculated on each service separately. If you receive a discount on your price, the increase will be applied to this amount.

Existing customers who get hit by this next year could try haggling for a better price (Retentions – Tips for Cutting Your Broadband Bill) or, since many will be out of contract anyway (assuming it’s a fixed price plan), then you could consider switching away to a different provider.

Prices tend to rise because ISPs are frequently adding all sorts of new services, developing new systems and consumers are also gobbling significantly more data every year. Suffice to say that service improvements and rising demand cost money, which means that ultimately customers will end up paying more and all of the big ISPs seem to follow the same sort of trend.

Providers are also under pressure to adopt all sorts of new rules, such as having to cater for the hugely expensive new system of automatic compensation (here). Nevertheless BT, EE and Plusnet’s decision to adopt this change, coming so soon after they introduced a policy of CPI-only increases, remains a controversial move. The fact that it comes during the COVID-19 crisis, and before a mass of expected job losses, certainly doesn’t help.

UPDATE 2:12pm

Just to add, but this also applies to John Lewis Broadband, which is supplied by Plusnet under a managed service contract.