4G smartphone

Ofcom has announced that consumers hit with mid-contract price increases will be able to leave without a penalty fee.

The regulator has said that consumers should be allowed to exit a landline, broadband or mobile contract for free if the provider increases the price. The decision follows a consultation on how to give consumers a fairer deal a price rise is introduced during fixed-term contracts.

See also: Tesco Mobile offers 4G for £2.50.

Claudio Pollack, Ofcom’s Consumer Group Director said: "Ofcom is today making clear that consumers entering into fixed-term telecoms contracts must get a fairer deal. We think the sector rules were operating unfairly in the provider's favour, with consumers having little choice but to accept price increases or pay to exit their contract."

"We're making it clear that any increase to the monthly subscription price should trigger a consumer’s right to leave their contract – without penalty."

Ofcom has said that any increase to a monthly charge is 'materially detrimental' to consumers and providers should give at least 30 days' notice of s price rise while being clear and transparent about it.

The new rules will come into effect in three months and will apply to any new landline, broadband, and mobile contracts starting afterwards. They only apply to changes in price but Ofcom will consider a reduction in the contract's allowance, calls and texts for example, a price increase.

It's all about giving consumers a fairer deal and avoid unjust price hikes during a contract. However, users won't be able to escape charges outside of the main contract such as roaming and breaking allowance limits.