BT ramps up landline charges by 10%

by Jane Baker on 20 July 2010  |  18 comments
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As BT increases its charges, find out how to pay less for your home phone and cut your call costs in six super easy steps.

There was bad news for 12.5 million BT customers this week following an announcement by the telecoms giant that it is hiking up landline call charges by 10%, and increasing its monthly line rental by 50p.

Peak calls will now cost 6.4p a minute (up from 5.9p) and the cost of connecting a call will also rise by a penny. The standard cost of a landline will now be a whopping £159.48 a year.

Here at lovemoney.com, we have no doubt this will be the last straw for many customers, coming as it does hot on the heels of BT’s decision earlier in the year to sneakily move its ‘off-peak’ calling hours forward an hour, so that phonecalls made between 6pm and 7pm now incur higher, peak charges.

In a bid to stop customers deserting in their millions, BT has offered a sweetener: customers who sign up to a 12-month line rental contract before November will be charged just £113.88 a year for their landline if they pay upfront before the end of October. That’s a saving of £45.60 a year.

But that’s not the only way you can save. Here are my six top tips to help you slash your phone bill:

1. Switch your provider

Why put up with BT when you can pay less for a better service? According to Consumer Choices, we’re wasting over £350 million every year by forgetting to shop around for a better deal on line rental and call charges. In fact, 53% of you haven’t switched in the last five years, so you’ll probably find you’re paying well over the odds now.

There are lots of comparison websites - such as HomePhoneChoices and FirstHelpline to name just two - which can help you find the cheapest landline deal. But, don’t forget, you may be able to save even more money with a bundle that offers line rental, broadband and perhaps TV together as a single package, so check these out too.

FirstHelpline reckon you can save around 35% off a typical annual bill of £330. That’s a saving of £115 a year just for taking the time to switch to a better call plan.

Saving: £115 a year if you switch every 12 months.

2. Choose a deal which suits you best

Think about how you normally use your landline before you commit to a new contract. Do you tend to make most of your calls at certain times of the day? Do you make a lot of international calls to friends and family overseas? (Although, you may be able to make significant savings by making international calls over the internet) Or, do you regularly call mobiles from your landline?

Make sure you choose a package which offers the most competitive call charges based on your own usage. A good home phone comparison website should help you to identify the best deal depending on how you use your phone and how many calls you usually make.  

3. Pay by direct debit and choose paperless billing

Paying your bill by direct debit and choosing online paperless billing can actually be a fair bit cheaper. Moving to direct debit payments alone could save you as much as £5 a month.

For example, you’ll be charged with an extra £1.50 by BT if you don’t pay by direct debit. You’ll also be hit with another charge of £1.25 if you don’t sign up to paperless billing. That increases the total monthly cost to £14.29, but taking these simple measures can save you £33 a year.

4. Check the small print

If you’re still tied into a 12 or 18 month contract with your current landline, you could be hit with exit fees if you switch early. You’ll need to check out whether the savings you’ll make by switching will be more than enough to compensate for any charges you might incur as a result of moving to a new supplier.

5. Check when you can call off-peak

You can make huge savings on your phone bill by making the most of cheap or free calls at off-peak times. Just make sure you check out exactly when these hours apply, and try to avoid making calls outside these times if at all possible.

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Remember, your supplier can alter peak and off-peak times whenever they choose. If you make lots of calls between 6pm and 7pm, don't put up with BT, Sky and TalkTalk charging you more. Switch to Primus' Home Saver package, which includes weekend calls and evening calls from 6pm if you sign up via comparison site Homephonechoices. Alternatively, just threaten to switch and see if you get offered a better deal from your current provider.

You may also want to consider using Skype for free web-to-web calls during peak hours or dialling a no-frills package provider 18185 before each call.

Saving: £368 a year if you don't make calls via BT and TalkTalk before 7pm.

6. Do you really need a landline?

Finally, ask yourself whether you really need a landline nowadays. I know I use my home phone significantly less than I used to now that I’ve got so many inclusive minutes to use as part of my mobile phone contract.

And you could always sign up with Skype to make free calls when you’re at home via your computer.

Of course, you may think you still need a landline for your broadband connection, but why not consider mobile broadband as an alternative? That way, there may be no need for a phone line at your home at all. Take a look at Save £132 with a dongle to find out whether this could be a good choice for you. You can even pay for mobile broadband on a pay-as-you-go (PAYG) or pay-per-day basis if you don’t want sign up to a lengthy contract.

Saving: £138 a year based on BT line rental at £11.54 a month.

Total savings: £516 a year or £138 if you ditch your landline.

More: 3 ways to save on your mobile bill | The best-value iPhone tariffs