BT lines up rental cost rises

MILLIONS of customers will see their phone bills rise when BT puts up line rental charges later this week.

The telecoms giant is introducing a new pricing structure from 1 July, which will include an increase of £1 in the standard monthly fee for direct debit customers, to a flat rate of £10.50.

More than 3m people who are billed by BT for line rental, but pay another company for their calls, will be hit by the move. It is expected to add around £12 a year to the average user's bill.

Under the changes the cost of BT‘s Ring Back service will also increase, by 50%, from 10p to 15p per use. Calling the Speaking Clock will double from 10p to 20p, while the monthly rental fee for BT's personalised 1571 answerphone service, will rise 50%, from £1 to £1.50.

Because BT is the only company to provide line rental for landlines, there is no option to go elsewhere. However, this doesn't mean sticking with BT for calls. There are around 140 providers to choose from, all offering different call rates and tariffs.

Price comparison service, uSwitch.com, believes the BT move highlights the importance of reviewing the call tariffs on offer and switching where necessary, to keep bills down.

Jon Miller, director at uSwitch said: 'The unfortunate fact is that consumers will still be charged a minimum £31.50 a quarter before they‘ve even made a call. BT is not the cheapest supplier on the market, but switching is easy and people can make significant savings by shopping around.'

This is backed up by figures from uSwitch, based on the annual bill for an average user (someone making three calls a day,at any time, including a small number of mobile calls).

One.Tel's StandardUKTalk tariff was found to be the best price option for average users, at £222 a year This was followed by Tele2's Standard tariff at £227, then Hust Dial's Standard Online tariff at £230. BT was eighth on the list, with users on its Together Option 1 tariff paying £244 a year on average.

The good news is that BT is cutting the cost of calls for customers on the standard-rate tariff, in a move expected to save average users around £24 a year.

The current rate for peak-time local calls is 3.95p a minute and 7.91p for national calls. This will fall to 3p a minute for daytime local and national calls, and a flat fee of 5.5p for calls of up to an hour made in the evening or at weekends.

The move has also sparked a price war with providers Telewest, Just Dial, Tiscali and Equitalk all announcing a cut in rates, to be introduced at the beginning of July.

Miller said the forthcoming changes were welcome news for customers. 'As predicted, the CPS suppliers have reacted strongly to BT‘s tariff changes, and we fully expect more price reductions over the next few months.'