"CPI + 3.9%" buried in a contract used to mean an unpredictable price rise every year. Since January 2025, that formula is banned in new UK telecom contracts — but older contracts are a different story.
The rule: inflation-linked rises are banned in new contracts
From 17 January 2025, Ofcom prohibited phone, broadband and pay-TV providers from including inflation-linked or percentage-based price-rise terms in any new contract. Any price increase written into a contract from that date must be set out in pounds and pence, at a specific date, shown prominently at the point of sale — not as a formula tied to a future CPI or RPI figure the customer can't predict.
What this changes in practice
A new contract can no longer say "your price will rise by CPI + 3.9% each April." Instead it must say, for example, "£30.00 until 31 March 2027, rising to £31.50 on 1 April 2027." Providers can still raise prices mid-contract — the ban doesn't outlaw price rises, only the unpredictable inflation-linked formula. Most major providers now build in a fixed pounds-and-pence rise instead.
If your contract predates January 2025
The ban applies to contracts signed or renewed from 17 January 2025 onward. If your existing contract was taken out before that date with a CPI/RPI-linked clause, that clause can continue to apply until your current contract ends — the new rule isn't retroactive.
When a price rise lets you cancel penalty-free
Separately from the CPI ban, Ofcom's long-standing fairness rules mean that if a provider raises your price mid-contract in a way that wasn't clearly and specifically disclosed when you signed up, you generally have the right to leave without an early termination charge, provided you act within a set window after being notified — check the exact notice period stated in your provider's own price-rise notification, since providers must give at least 30 days' warning before any increase takes effect.
What this means practically
- Signed a new deal since January 2025? Any future price rise should already be stated in pounds and pence — check your contract confirmation for the exact figures and dates.
- Still on a pre-2025 CPI/RPI-linked contract? That clause can keep applying until the contract term ends.
- If a price rise wasn't clearly disclosed as a specific amount when you signed, ask your provider directly whether you qualify for a penalty-free exit.
- Keep your original contract confirmation — it's the only way to check what was actually disclosed versus what's now being charged.
Sources
- Ofcom — Ban on mid-contract price rises linked to inflation: ofcom.org.uk
- IBTimes UK — How the pounds-and-pence rule changed 2026 pricing: ibtimes.co.uk
Related Kibbo Tools
- Telecom Contract Before Signing Checklist — confirm exactly how future price rises are disclosed before you sign.
- Telecom Cancellation Checklist — steps to cancel correctly if a price rise qualifies you for a penalty-free exit.