Consumers suffering from broadband problems such as slow repairs, installation problems and missed appointments, will receive automatic compensation payments, after the major UK ISPs agreed to a new proposal from telecoms regulator Ofcom.
The current system requires consumers to proactively claim compensation, which has led to only one in seven cases receiving a pay out.
The new scheme provides fixed payments for specific problems:
- Consumers will receive £8 per day for each day the broadband service is down, if it not fixed after two working days.
- A payment of £25 per missed appointment will be paid if an engineer fails to turn up, or if an appointment is cancelled with less than 24 hours notice
- Customers will be paid £5 for each day after the promised start date of a new broadband service.
The ISPs have 15-month settling in period to ensure billing systems, accounts and contact centres are all capable of handling the new regime. Ofcom has said it will review the situation in a year to ensure the appropriate changes have been made.
The new compensation plan will also benefit businesses. Many still use residential landline and broadband services. Almost 30% of smaller companies ignore the higher prices of business packages, according to Ofcom. While some business contracts do offer compensation as part of the deal, many companies are not aware of this.
To address this, Ofcom is planning new rules to ensure SMEs are given simpler, more detailed information upfront about their broadband service, including when and how they can claim compensation.
Lindsey Fussell, Ofcom consumer group director, said: “Waiting too long for your landline or broadband to be fixed is frustrating enough, without having to fight for compensation. So providers will have to pay money back automatically, whenever repairs or installations don’t happen on time, or an engineer doesn’t turn up. People will get the money they deserve, while providers will want to work harder to improve their service.”
Alex Neill, managing director of home services for Which?, said: “We are pleased that compensation for poor broadband is going to become automatic, as it is now such an essential part of all of our everyday lives. For all consumers to get what they’re entitled to, it’s vital that all providers play fair and sign up to this scheme.”