Thirfty Living: How to avoid those pesky phone nasties

Although the cost of mobile and home phone packages has been coming down in recent years, it's still all too easy to rack up a nasty bill if you steer outside what's included in your regular bundle.

One of the most common ways that people get caught out is by calling 0870, 0845, 0844 and other non-geographic numbers – which are rarely included in standard packages, and can cost up to 35p a minute to call. And if you accidentally get roped into calling a number that begins with 09, the charges are considerably higher.

Crack down

The good news is that the public's growing anger about 0870 numbers prompted the telephone regulator Ofcom to launch a consultation last year, which resulted in a proposal to bring 0870 call charges into line with national rates. It is thought that this idea will be rubber-stamped sometime within the next few weeks.

But even after Ofcom's proposals have come into effect, the danger won't have subsided entirely. 0844 and 0845 numbers can still be charged at up to 25p a minute from mobile phones, while 0871 and 0872 numbers have now been classified as "premium rate", meaning that they can be even more expensive. Nevertheless, these numbers are still often used by regular financial services companies and utilities as a first point of contact for customers.

There's also the chance that once 0870 charges have been brought down, companies will simply start migrating to 0844 and 0845 numbers, where they can still charge that little bit extra.

Non-geographic numbers have proved a nice little earner for companies over the past few years – revenue which they're sure to be reluctant to give up during the current economic climate. The likes of 0870, 0844 and 0845 all allow for revenue to be shared between the phone provider and the company which owns the number. Although it might only amount to a few pence a minute, this can roll up to millions of pounds a year for the largest companies in Britain.

According to research by the consumer group Which?, the Government's Driver and Vehicle Licensing Agency raised almost £2.5m from its 0870 numbers in 2006 – just one of several Government departments to make seven figure sums each year.

So if you receive a letter informing you that your insurer is changing its call centre number, be careful to check out what the charges will be for calling its new number.

Avoiding charges

If you want to avoid paying additional charges for non-geographic numbers, it's actually very easy. Almost all banks and utility providers have alternative local numbers that you can call, which will be charged at your standard rate, or included within your free minutes.

One easy way to identify these numbers is to look on a company's website to see whether it has a number to call if you're phoning from abroad. Just replace the '+44' at the start of the number with a '0', and save it into your phone.

Another easy way to avoid charges is to try calling alternative numbers in an organisation – such as their main switchboard. The operator will usually be able to transfer you, but you'll only be paying for the local number that you called.

You might also want to take a look at www.saynoto0870.com, which has a list of non-geographic telephone numbers used by British companies, along with regular numbers that can be used in their place.

Finally, it's also worth bearing in mind that BT already allows calls to 0870 and 0845 numbers to be included within their customers' regular call packages. Although no other providers have followed suit yet, this could be something that other telecoms firms adopt in the future.

Premium rate numbers

From August this year, numbers that begin 0871 or 0872 will be classified as premium rate, joining the likes of 09 and 070 numbers. As a result, they'll move under the regulation of Phone Pay Plus – the UK's premium rate phone line watchdog.

Premium rate numbers are bound by strict rules, and it should always be clear how much you're being charged. If you think that a premium rate service has not made the cost clear, you can complain to phonepayplus via their website at phonepayplus.org.uk.

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

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