Phone bills confuse consumers

Tuesday, 23 March 2004 12:00 AM

Confusing phone bills are making it harder for consumers to make an informed choice over their telephone supplier, according to a Committee of MPs.

A report by the House of Commons Public Accounts Committee says that the new communications regulator, Ofcom, should encourage consumers to switch supplier to get a better deal.

It criticised Ofcom's predecessor, Oftel, for being remote, hands-off and for spending less than one per cent of its overall budget on external publicity.

Committee chairman, Edward Leigh, said: "Many consumers are not getting as good a deal as they could on their telephone bills. They could save money by either switching supplier or changing their tariff. It is unacceptable that BT retains around 70 per cent of the total market 20 years after privatisation."

The committee said that competition in the market is well-established, and there are a range of tariffs and choices available to consumers.
However, consumers do not have the right information to allow them to identify the best deal. It said that many telephone bills do not provide enough information to allow consumers to determine best tariff and discount options, and comparisons are made more difficult by the different ways different companies quote their tariffs.

The committee was particularly concerned over the poor level of take-up of the BT Light User scheme, which provides discounts of up to 50 per cent.

And it said that Ofcom should inform consumers that renting handsets is more expensive than buying a handset.

The report called on Ofcom, which assumed Oftel's regulatory functions at the end of last year, to develop more standardised and transparent charging structures to enable comparisons to be made. It should also research the information needs of consumers and follow the practice of regulators in the energy sector by encouraging consumers to switch supplier.

Mr Leigh added: "There is no doubt that consumers find the telecommunications market confusing, and need more help to make properly informed choices."

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