Broadband and home phone customers with the biggest telecoms providers will soon be automatically compensated for poor service or missed appointments, under a new scheme set to be up and running by early 2019.

Telecoms regulator Ofcom has forged an agreement with five firms, including BT, Sky and Virgin Media, to knock money off customers' bills.

It first began consulting on the scheme in March this year, and under its final plans, announced today, the amount of compensation offered will be slightly reduced. The total expected to be paid out by providers each year has fallen from £185 million to £142 million.

But given the current amount of compensation paid is just £16 million a year, it should still be a real boost for broadband and home phone users. Under the scheme, you'll be entitled to automatic compensation when:

  • Your landline or broadband is not fixed quickly enough after it has stopped working.
  • Your new landline or broadband service is not up and running on the day promised.
  • An engineer doesn't arrive for an appointment as scheduled.

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You could receive £8 a day for delayed repairs

Here's what you'll get as automatic compensation under the new scheme:

Payouts for poor service

Problem Landline or broadband customers are entitled to compensation if... Amount of compensation
Delayed repair following loss of service Their service has stopped working and it's not fixed after two full working days £8 for each calendar day the fault isn't repaired
Missed appointments An engineer doesn't turn up for a scheduled appointment, or it's cancelled with less than 24 hours' notice £25 per missed appointment
Delays with the start of a new service The provider promises to start a new service on a particular date, but fails to do so £5 for each calendar day of delay, including the missed start date

It's worth stressing that for a delayed repair you'll begin to be paid compensation if it's not fixed after two working days (so Monday to Friday), but after this point you'll be owed £8 each calendar day, including weekends and bank holidays.

90% of customers should get automatic compensation by February 2019

The scheme is a voluntary agreement between Ofcom and broadband providers. But five providers – which between them have about 90% of broadband and home phone users as customers – have already signed up:

  • BT
  • Sky
  • TalkTalk
  • Virgin Media
  • Zen

The regulator also expects EE and Plusnet to join the scheme in due course.

The scheme is expected to take 15 months to put in place, to allow for changes to billing systems, online accounts and call centres.

Ofcom says compensation is currently only paid out for around one in seven broadband or landline problems, and at the moment customers who are given compensation only receive an average £3.69 a day for loss of service, and £2.39 a day for delayed installations.

Ofcom says mobile customers aren't covered by the new automatic compensation scheme as they are less likely to lose service for more than 24 hours, and currently receive more compensation than broadband and landline customers.

What does Ofcom say?

Lindsey Fussell, Ofcom's consumer group director, said: "Waiting too long for your landline or broadband to be fixed is frustrating enough, without having to fight for compensation.

"So providers will have to pay money back automatically, whenever repairs or installations don't happen on time, or an engineer doesn't turn up. People will get the money they deserve, while providers will want to work harder to improve their service."