BT toughens stance on late-paying customers

British Telecom may impose a wider bar on outgoing calls for people who fail to pay on time under proposals to be put this week to the watchdog Oftel.

The report to the regulator comes amid growing concernover rising disconnections, which jumped by 9 per cent to almost 800,000 last year - with the December year-on-year increase soaring to 16 per cent.

The disclosure of the figures, yet to be announced by BT, comes as the company faces increased competition from rivals which include cable television companies and electricity firms and needs to be seen to offer high standards.

In addition to call-barring to help reduce disconnections, BT is preparing a trial scheme under which certain customers will have a pre-set limit on the use of the telephone beyond which they would not be able to make calls. BT's submission to Oftel may also include proposals for a "Call my bill" service, which would provide people with a number to call if they wish to find out how much they have spent so far on their current bill.

But the rise in disconnections has angered the Consumers' Association, which accuses BT ofdragging its feet in finding a solution to the problem. An association spokesman said: "There has been a failure to acknowledge that there is a serious issue here."

The association is particularly concerned at the acceleration in disconnections at the end of last year and warned that January, traditionally a bad month, could see a further sharp rise to as much as 100,000. It also points out that BT's performance compares with annual disconnection levels in the electricity industry of 1,100. In gas and water the figures are about 16,000 and 10,000 respectively.

A BT spokeswoman said that about two-thirds of those who are disconnected are almost immediately reconnected when they pay up. "There are occasions when disconnection, or the threat of it is, the only way to get people to settle their bills," she said, but added: "Many of the disconnections relate to people who have no intention whatsoever of paying ..."

BT argues that the burden of bad debt equates to about pounds 6 on the average bill and that it has a responsibility to protect genuine customers who do pay. The spokeswoman said that it is unfair to compare BT's position with electricity, gas and water as it is much easier to run up very large telephone bills.

However, Philip Cullum, the association's policy manager, said BT was "clearly doing something wrong if it can't persuade the customer to pay before they are disconnected".