Millions of Benefits Claimants Overpaying for Broadband

February 2022

Millions of Benefits Claimants Overpaying for Broadband

New research conducted by Ofcom has found that millions of low-income households are missing out on discounted broadband deals.

The special rates, otherwise known as ‘social tariffs’, are available to claimants of Universal Credit, Jobseeker’s Allowance and Income Support. Out of the 4.2 million households that qualify, only 55,000 have taken advantage of them.

The issue appears to be one of awareness. Ofcom’s found that 84% of eligible households did not know these offers existed, with only 1.2% signed up to a social tariff.

In light of this, Ofcom is urging broadband providers to better promote the deals after seeing ‘limited evidence’ that this was being done. They noted that such offers rarely appear as part of advertising campaigns or as featured deals on comparison websites.

Currently six providers provide these packages - BT, Community Fibre, Hyperopic, KCOM, Virgin Media and G.Network. While the actual deals vary slightly, all offer noticeable discounts. For example, for BT a standard 36Mbps plan costs around £28 per month. However, as part of a social tariff, it only costs £15 per month.

The potential savings amount to an average of £144 per year. It’s a significant amount, made even more so by the ongoing cost-of-living crisis, which is being largely driven by rising energy bills.

“People rely on their broadband for staying in touch, working and learning from home. But for those who are really struggling with rising bills, every penny counts,” said Lindsey Fussell, Ofcom's Network and Communications Group Director.

“Special discounts can make all the difference, and too many broadband firms are failing either to promote their social tariff or to offer one at all. We expect companies to step up support for those on low incomes, and we’ll be watching their response.”

In light of its findings, Ofcom has set out four changes it wants to see in the industry.