BT landline-only customers could save £5 a month due to Ofcom price cut

Ofcom has reviewed the whole landline-only market and says such customers – who are often elderly or vulnerable and seldom switch providers – are getting "poor value for money in a market that is not serving them well enough".

They have also been particularly hard-hit by price hikes in telephone line rental in recent years despite falling wholesale costs, Ofcom added, with major providers increasing line rental charges by between 25% and 49% in real terms.

Under Ofcom's plans BT landline-only customers, who currently pay £18.99/month for line rental, would pay no more than £13.99/month – a reduction of at least 26%, and a saving of at least £60/year.

However, the regulator is currently consulting on the extent of the discount it will impose, and says that while it will be "at least" £5/month, it could be as much as £7/month.

An Ofcom spokesperson told MoneySavingExpert.com it had focused on BT because the telecoms giant supplies about 80% of the UK's 2.9 million landline-only customers.

A final decision on whether to cut bills and by how much will be announced towards the end of 2017, meaning the price cut itself may not come until 2018.

To cut the cost of your landline bill, check out our Cheap Home Phones guide for top MoneySaving tips.

Who will benefit?

Landline-only customers are those who buy only a landline service from a provider – either because they don't want broadband or pay TV, or because they have bought those services from a rival provider.

If Ofcom's proposed price cut goes ahead, only landline-only customers who buy their landline services directly from BT will benefit.

Those whose landlines simply run on BT technology but are rented from other providers (such as Plusnet customers) WON'T be affected – though Ofcom told us that if it cuts BT's prices it expects other providers to follow suit.

Why is Ofcom looking at the landline-only market?

The regulator says it's concerned about "rapidly rising" prices for landline-only services, which have hit customers' pockets despite falling wholesale costs in recent years.

Ofcom believes these customers may be missing out because cheaper deals are targeted at those buying bundles of phone, broadband and/or pay-TV services.

Can I respond to Ofcom's consultation?

Yes, you can. You can read the consultation proposals and respond to them using the web form provided, or by emailing retailvoicemarketreview@ofcom.org.uk by Thursday 9 March.

What does BT say?

A BT spokesperson said: "We will respond to Ofcom's consultation fully when we have considered the detail. We take our responsibilities in this area very seriously and, unlike other companies, have many customers on special tariffs for socially excluded or vulnerable customers, including BT Basic, which still costs just £5.10 a month for line rental and calls, and Home Phone Saver. "Recently, we have frozen the cost of line rental for all of our customers who take a BT phone line. We have also been improving the service we provide and customers have benefitted from our multi-million pound investments in a faster fault repair service, the launch of our free nuisance calls prevention service BT Call Protect and bringing call centre work back from India to the UK."

What does Ofcom say?

Ofcom chief executive Sharon White said: "Line rental has been going up, even as providers' costs come down. This hurts people who rely on their landline the most, and are less likely to shop around for a better deal. We think that's unacceptable.

"So we plan to cut BT's charge for customers who take only a landline, to ensure that vulnerable customers get the value they deserve."