Price increase on new contract.

[stevedh2]

The ink has barely dried on my new contract and it is already going up.
I understand these new in-contract price increases are now a thing, although I think you should have at least been on contract for a year, or even 6 months before it goes up. Really though this whole mid contract price is wrong, imagine fixed mortgages etc could do this.

My contract is barely a month old and it is already going up by almost 30%, and this was from a new contract I was persuaded to take from a cold call.

Also my contract just says pay x until August 2024 at which point new bill will by y, nothing about another price increase in April 2023.

[Andrew-G]

Unfortunately unless you actually specifically agreed a fixed price deal*, the T&Cs applying to the contract you agreed to give VM the ability to hike prices by as much as they want (see para i 4), when they want, but you have the right to cancel or renegotiate.  New T&Cs that they'll be imposing soon will change that Martini price rise clause to an annual RPI+3.9% formula, and remove the right to cancel or renegotiate (thanks, Ofcom, you're useless!).  The way VM implement that RPI+3.9% will also mean that anyone on a decently discounted package will see a much higher month on month price rise come next year, potentially double the claimed RPI+3.9% figure. If phoning to renegotiate the deal, (1) hold out for new customer pricing on a new 18 month contract, and also (2) push the agent to confirm that this is a fixed price for 18 months.  Initially they'll refuse both, a hardened negotiator can get those, although you may need to issue cancellation notice to get them to talk serious discounts, and you'll need to ensure you secure copies of the call recordings via DSAR shortly after you've agreed such a deal - VM delete call recordings after six months, and chances are even if an agent agrees to a fixed price, that won't be put on the system.

* If you did agree a fixed price, then put in a DSAR, request all the call recordings now, see if they back up what you recall, if they do that becomes legally binding and VM can't increase your price regardless of what excuses they make.

[stevedh2]

Thanks
however when I look at T&C para i 4, it just seems to be about 3rd party services, Do you know what the correct section and paragraph are, or am I just misreading para i 4.

And I saw the RPI+3.9% so above inflation price rises guaranteed 😞

Spose the only other way around it is to try and get a 12 month contract just after the price increase...

[Andrew-G]

Sorry, should have referred to i 2  !

And para K 4 elaborates on that to the same effect, and references N 6 which gives you the right to cancel or renegotiate (this year).

[stevedh2]

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@Andrew-G wrote:

Well, a few are immune.  ...... , and there's a cutoff date at some point early this year where contracts are deemed to already be against the 2023/24 rates and so won't be affected by this year's price rise. 

Hi, you wrote this yesterday, Was those who had negotiated a fixed price contract, was it just a guess, is there some truth in it, or did I misunderstand what you were saying?

[Andrew-G]

There's definitely truth that VM have some customers on fixed price contracts, but it has always been the case that the vast majority of customers have fixed discount contracts.  Under a fixed discount contract, VM can vary the price, but your discount of £x per month continues to apply.  From time to time VM have officially offered fixed price deals (although I'm sure these were sales-channel and package specific rather than all-customers, all channels).  In addition, anybody who can press a sales or retention agent to agree that they're on a fixed price contract will be in that situation (thanks to Consumer Rights Act Section 50 part 1).  There's been a few posts here from lucky customers that confirm they're on fixed price.

Due to lax training and governance, and due to the sales incentives, there arise situations where an agent may promise a fixed price deal to a customer to secure a deal, even if they can't put a fixed price deal on the system (obviously fixed price isn't what VM want).  If the deal then gets put through as a fixed discount, the customer may notice and complain, or may not notice for many months by which time all the evidence has conveniently been deleted.  If the customer has evidence such as chat transcripts, or call recordings obtained from VM by DSAR, then they can contest it if they did agree fixed price, and VM will have to honour.  I suspect this applies to a tiny minority of customers - most either don't understand the difference and assume their price is a fixed price (and many of those won't complain when it isn't), or they do understand it's a fixed discount.

[John_GS · Accepted solution]

Hi @stevedh2 

Thanks for posting and welcome to the community.

Sorry for the confusion over the price increase as you say you have just agreed a new deal.

I will PM you now to assist further with this.

Best wishes.

[stevedh2]

All sorted and looks like the letter may have been sent before I sorted the new contract, so it does look like new contracts shortly before a price increase are already based on the new price so shouldn't face the increase, although I can't guarantee that.

[John_GS]

Thanks for joining me on PM @stevedh2 and allowing me to sort this for you 🙂

Do pop back to the Community if you ever need anything.

Best wishes.