Tag: broadband providers

Millions unaware of available support with household bills as debt soars, NAO finds

  • Debt to water and energy companies reached more than £7 billion, while customers are missing out on support to help them manage debt, such as repayment plans and social tariffs
  • A third of customers did not find it easy to get in touch with their broadband providers when things go wrong
  • The NAO says regulators Ofgem, Ofwat and Ofcom must strengthen support for consumers in vulnerable circumstances, increase awareness of support and tackle the drivers of rising debt.

Millions of people are missing out on support for essential bills, such as water, energy and broadband, as debt to water and energy companies climbs over £7 billion1 – this is according to a report by the National Audit Office (NAO) published today (10 June).

The report examined how Ofcom, Ofwat and Ofgem support consumers in vulnerable circumstances and whether people can access the help they need from providers of essential services.

The watchdog found there has been a marked increase in household energy debt, following Russia’s invasion of Ukraine, with energy debt more than double what it was in 2021, rising by 118%.2

Since the NAO’s last report on this topic in 2019, regulators have strengthened protections, introducing new rules on how companies treat customers and taking enforcement action – for example changing company licences to improve customer service and issuing multi-million-pound fines to providers where service and performance fall short of expectations. Now, NAO finds the regulators must now make changes to keep pace with consumer needs.

Consumers still struggle to contact their providers and are not always aware of support available to help manage their bills – such as social tariffs and repayment plans.

The NAO found only a third of eligible broadband customers and 39% of water customers who are struggling to pay their bills are aware of social tariffs, meaning people on low incomes and in vulnerable circumstances could be missing out on support to help manage debt. Energy customers on repayment plans owe around £1,000 less than those without one in place.

Ofwat and Ofgem have overseen an uptake in registration for company priority services registers (PSR)3, although consumer awareness remains low. The PSR does not extend to the broadband sector, which has separate requirements. Ofcom does not routinely monitor take up or awareness of support.

The NAO found regulators are not aligning their performance measurements with actual consumer experiences and outcomes.

The NAO recommends regulators:

  • Improve access to support – to make it easier for people to contact providers through a range of accessible channels that meet the diversity of consumer needs.
  • Increase awareness of available help – such as social tariffs, repayment plans and other support schemes, so eligible consumers are clearly signposted and not missing out.
  • Tackle industry drivers of rising debt – including addressing industry practices such as inaccurate billing, delays when people move home and barriers that prevent consumers from switching tariffs. The NAO found that industry practices account for an estimated 35% of customer energy debt.
  • Strengthen support for consumers in vulnerable circumstances – promoting services that are designed around need, improving how consumers are identified and supported, and making better use of data and data-sharing across sectors 

Gareth Davies, head of the NAO, said: “Regulators have made progress to support consumers, but they’re not keeping up with the pressure now facing millions of households.

“With debt rising sharply, it’s more important than ever to make regulation work so that people know what support is available and can contact essential providers when they need to.”

READ THE REPORT: Regulating water, energy and broadband to protect consumers in vulnerable circumstances

Major broadband providers not up to speed during pandemic

Some of the UK’s biggest broadband providers have been letting down their customers on connection reliability, internet speeds and value for money during the pandemic, according to Which?’s annual customer satisfaction survey.

During the Covid-19 pandemic, broadband has proved more important than ever – with millions of people relying on their internet to work from home, educate their children and keep in touch with loved ones.

In Which?’s annual survey, seven in 10 people (71%) said they had used their connection more since the outbreak of the pandemic, with nearly two thirds of those saying their use has increased substantially.

However, the volume of issues consumers have experienced with their broadband provider has also increased over the past year. Seven in 10 (69%) respondents said they had experienced an issue with their connection in the past 12 months – a substantial increase on last year’s survey.

Very low speeds (59%) and frequent dropouts (53%) were the most common problems experienced more often during the pandemic, compared to before the pandemic. Almost half of respondents (48%) reported they had been left without a connection for more than a day and around four in 10 (44%) said they had been left without internet for more than an hour.

The findings reflect the likelihood that an increased reliance on broadband over the past year means customers are more likely to notice – and be frustrated by – any connection issues.

Although the Big Four broadband providers – BT, Sky, TalkTalk and Virgin Media – supply nine in ten households, our survey found they have left many customers disappointed.

Virgin Media has its own cable network in parts of the UK, which allows it to offer some of the fastest broadband speeds. Yet its customers gave it poor ratings for connection reliability – with one in three Virgin Media customers saying they had experienced a connection outage lasting at least an hour in the past year and almost a quarter saying their connection was slow to upload or download.

Virgin Media customers were also less likely to be satisfied with their customer service, ease of setup and value for money. Overall, Virgin received a low overall customer score of just 53 per cent – leaving it second from bottom in Which’s satisfaction rankings.

TalkTalk and Sky fared similarly, with customer scores of 54 per cent. While TalkTalk scored fairly well for value for money, it had the highest proportion of customers who would not recommend their provider to others.

Sky rated poorly for value for money – perhaps because a quarter of Sky customers experienced frequent dropouts despite paying more for their service than the average broadband customer.

To add insult to injury, more than a quarter of Sky customers said the price of their deal had increased in the past year.

Sky also received low scores for connection speed, connection reliability and ease of setup and dropped three places in this year’s survey. The Which survey also revealed Sky to be the joint worst provider – along with Utility Warehouse – for very slow speeds, which affected three in 10 (29%) customers.

BT earned the highest score of the Big Four providers (57%) but still only managed eighth place overall – just one place up from its ranking last year. It scored middling ratings across the board apart from value for money, which scored poorly.

One BT customer said they were satisfied with BT but believed the provider could do better – especially during the pandemic, when more people are working from home and dependent on an internet connection.

More than half of BT’s customers had never been with another provider, and the majority were not planning to switch. But our results show that out-of-contract BT customers should consider making a move as they are likely to find an alternative that is both cheaper and more reliable.

Only John Lewis scored lower than the Big Four (47%), with low ratings for connection speed, connection reliability and ease of setup.

At the other end of the scale, Zen Internet achieved the highest customer score of 70 per cent and was the highest ranked broadband provider for the second year in a row (scoring 84 per cent in 2020).

Zen achieved high scores across the board and despite not offering the cheapest tariffs, 85 per cent said they would recommend it to a friend.

Zen narrowly missed out on Which? Recommended Provider (WRP) status as it has not yet signed up to Ofcom’s codes of practice on broadband speeds. However the company is actively working towards signing up soon, at which point it will become a WRP.

The survey also found customers who upgraded to fibre broadband often felt the benefits. Of the nearly 3,000 respondents who had fibre broadband, 63 per cent noticed faster speeds after switching and 45 per cent noticed fewer connection dropouts.

However, although superfast fibre connections are available to 96 per cent of the country, many are yet to take them up. Around a quarter of the respondents told Which? they still had standard broadband.

In light of these disappointing results for many providers, the broadband industry must up its game. Consumers are relying much more heavily on their internet connection during the pandemic and broadband companies will have to work harder to meet customers’ rising expectations and provide value for money.

The government has also recognised that as part of achieving its goal for at least 85 per cent of the UK to have access to gigabit-capable broadband by 2025, low consumer demand for these services in the current market must be addressed.

In August 2020, the UK government asked Which? to convene and chair the Gigabit Take-up Advisory Group (GigaTAG) to put forward recommendations on how to encourage more consumers to switch to gigabit-capable networks.

The GigaTAG is considering these barriers and the potential solutions in more detail and will report back to the government in spring 2021.

Natalie Hitchins, Which? Head of Home Products and Services, said: “With so many people at home relying on their internet during the pandemic, a good connection has never been more important – but we found some of the UK’s biggest suppliers are not up to speed.

“Broadband providers must up their game and meet the challenge of providing fast, reliable connections and good customer service for millions of customers whose needs and expectations have risen over the last year.

“The industry and government must also work together to ensure more people have the chance to switch to faster and more reliable gigabit-capable broadband services in the years to come – or risk undermining the UK’s goal of becoming a world leader in connectivity.”