BT tariff rise adds pounds 36 to phone bills
Saturday 01 June 1996
The price increases will fuel concerns that higher line rental charges discriminate against customers who make few calls. However, BT said the new tariff was part of its agreement with Oftel, the telecoms regulator, under which revenue from rental increases is used to cut the cost of calls.
The decision comes ahead of an announcement by Oftel on Monday which will outline its proposals for the new price structure that will come into force in July 1997.
The stock market reacted warmly to the news, marking BT shares 9.5p higher at 355.5p yesterday as some analysts suggested that the Oftel review was not expected to be too Draconian.
The new line rental charges will come into force this July and will be pounds 25.69 per quarter for residential customers and pounds 41.13 for businesses.
BT said the changes were the first increase to line rentals for 17 months and amounted to just a penny extra a day.
It also announced a programme to provide free conversion to modern plug and socket connections for customers who still rent phones with direct wiring. This normally costs pounds 29 but the fee will be waived during a special offer period of six months. Around 1.8 million customer still have direct wired phones.
Don Cruickshank, director general of Oftel, welcomed the changes. "BT has met its commitment to ensure that the increases in exchange line rental are such that no customer will suffer a real increase in his or her quarterly bill (for the same usage). He said the price changes followed reductions in call changes which were announced on Tuesday.
BT also drew attention to its low user scheme for people who make relatively few calls but need a phone as a lifeline. The maximum number of calls participating customers can make will be increased to pounds 15.67 a quarter from July. Customers within this receive up to 60 per cent off their rental charge.
BT said that main prices were coming down by more than pounds 300m this year. It also said the rental charges represented an increase of 3.7 per cent for residential customers and 2.4 per cent for businesses - below the 3.9 per cent increase in the retail price index since the last charge review in February 1995.
BT stressed that no customer's bill would increase by more than the current rate of inflation, 2.4 per cent. Under existing regulations BT can only increase its prices by 7.5 percentage points less than the prevailing rate of inflation.
International Women's Day 2014: The shocking statistics that show why it is still so important
Feminist quotes to inspire you on the International Women's Day
Belle Knox: How the porn star student from Duke University became bigger than Justin Bieber
International Women's Day 2014: Mothers and daughters describe their hopes and dreams in touching photographs
Liam Neeson on death of wife Natasha Richardson: ‘When I hear the door opening, I still think I’m going to hear her’
Apple's Tim Cook: Business isn’t just about making profit
Thousands of young people forced to go without food after benefits wrongly stopped under 'draconian' new sanctions regime
Ukraine crisis: New navy chief 'defects' and surrenders Crimean HQ as Putin claims ultranationalists forced intervention
Britain's top vet sparks controversy with call for ban on slashing animals' throats in 'ritual' slaughters for halal and kosher meat products
Ukraine crisis: Russia dismisses '3am ultimatum' as 'total nonsense'
If you're horrified by a flame-roasted dog, you should be shocked at a hog roast
- 1 International Women's Day 2014: The shocking statistics that show why it is still so important
- 2 Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
- 3 Orgasm machine to deliver climax at the push of a button
- 4 Too upsetting? Academy members voted for Oscar-winning 12 Years A Slave 'without watching it'
- 5 Liam Neeson turned down James Bond role to marry Natasha Richardson
iJobs Money & Business
£12000 per annum: Inspiring Interns: The company works with Tier 1 FTSE 100 Ba...
£32000 - £36000 per annum + generous benefits: Pro-Recruitment Group: * TAX * ...
£37000 - £40000 per annum + £20000 benefits package: Pro-Recruitment Group: **...
£30000 - £35000 per annum + generous benefits: Pro-Recruitment Group: Mixed Ta...