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Broadband compensation rules come into force

Regulations that guarantee consumers’ rights to automatic compensation from broadband providers when things go wrong have come into force, and many suppliers have a lot of work to do

Broadband customers who suffer delayed repairs, installations, or missed engineer appointments will now receive automatic compensation from their internet service provider (ISP) thanks to regulations imposed by telecoms regulator Ofcom, which came into force 1 April 2019.

Up to now, only around one in seven consumers who encounter such problems have received compensation, and even then in small amounts and subject to the terms and conditions set out by their ISP.

The regulator believes that by introducing these new measures – which were first proposed in 2017 – it will not only ensure fairness for consumers, but also give ISPs a strong incentive to improve their service.

“We think it’s unacceptable that people should be kept waiting for a new line, or a fault to be fixed,” said Ofcom chief executive Sharon White.

“These new protections mean phone and broadband firms will want to avoid problems occurring in the first place. But if they fall short, customers must be treated fairly and given money back, without having to ask for it.

“We welcome the companies’ commitment to this scheme, which acts as a strong incentive to improve service for customers,” she said.

Under the new regulations, consumers whose service stops working and is not fully fixed in two working days will get £8 for each calendar day that the service is not repaired; if an engineer fails for turn up for a scheduled appointment or cancels with under 24 hours’ notice, consumers will receive £25 per missed appointment; and if an ISP promises a specific service activation day but fails to keep to that, consumers will get £5 for each calendar day of delay, including the missed start date.

It has been estimated that collectively, British consumers and small and medium-sized enterprises (SMEs) that use residential packages could be in line for an annual pay-out of between £120m and £150m. It is thought that around five million consumers lose their service each year, nearly 250,000 engineer appointments are missed, and over a million installations are delayed.

At the time of writing, only BT, Sky, TalkTalk, Virgin Media and Zen Internet had fully signed up to the scheme, while Hyperoptic and Vodafone have both signed on but will start paying compensation automatically later in 2019. EE and Plusnet have also agreed to the new regulations - EE expects to start paying compensation automatically in 2020, and Plusnet has not yet confirmed its timescales. Between them, these companies account for 95% of all UK broadband customers.

Virgin dearth

Consumer advocacy organisation Which?’s most recent broadband customer satisfaction survey revealed that Virgin Media may be paying out a higher than average share of compensation after it was named the worst culprit among ISPs for leaving its customers high and dry for long periods.

Which?’s stats – which are based on a poll of 8,063 of its members taken in January 2019 – found that 17% of Virgin customers had been left with no connection for hours and even days at a time. This fell to around 10% of customers of BT, Sky and TalkTalk.

Which? also named SSE as the worst offender for leaving customers waiting in for days for an engineer, with 7% of customers facing this problem.

Meanwhile, Zen Internet, which usually scores highly on customer service metrics, left 50% of its customer waiting between two weeks and a month to set up a new service, and customers of fast-growing Vodafone were even worse off, with 16% saying they waited between a month and eight weeks.

“Delivering great customer service is in our DNA and we've always believed in compensating our customers if we haven’t been able to meet their expectations,” said Zen chairman and founder Richard Tang.

“The voluntary auto-compensation scheme is a great step for consumers in the UK, but hopefully, in time, it will become part of the process for all ISPs as treating customers fairly should be at the core of any organisation.”

“Broadband customers who suffer slow repairs, missed appointments and delayed installations have up until now had to jump through hoops to get compensation, so it is encouraging that some will now be refunded automatically,” said Which? head of home products and services, Natalia Hitchins.

“However, for consumers to truly feel the benefit of this scheme, broadband providers must improve their service overall. If not, we expect the regulator to show its teeth and take stronger action.”

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