The expert has shared the warning to those with a monthly phone contract with O2
Martin Lewis has issued a warning over the price hikes (Image: ITV)
Martin Lewis has issued a warning to millions of people with an O2 monthly mobile contract.
The Money Saving Expert has issued an alert that up to 15.6 million people’s monthly phone bills could rise more than what the network provider has said, due to mid-season price increases.
Back in January, Ofcom made the ruling that phone providers must show how much bills will hike each year in pounds and pence, before clients sign up.
But, in a move that appears to run counter to the spirit of these rules, O2 has announced that from next year, those who are in the middle of contracts will face bigger price rises than they had been told about, and that were originally written in their contracts.
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O2 has declared from April 2026, customers will find the originally stated £1.80 a month rise will now face a 40 per cent increase to £2.50 a month (a jump of £30 a year).
The Money Saving Expert website said that as its a flat rise for all contracts, those who are on less expensive plans will be disproportionately impacted.
This will mean some customers will see bills rise by 30 per cent.
And even those on the most expensive calls, calls, texts and data plan, which currently costs £34 a month, clients will see a rise of 7.4 per cent, which is above the current 3.8 per cent Consumer Prices Index (CPI) rate of inflation.
Mr Lewis said: “This move feels to me a bit like it makes a mockery of Ofcom’s new ‘pounds and pence’ consumer protection regime, which came in at the start of this year.
“The regulator’s solution to hideous above-inflation, mid-contract price hikes was that on sign-up firms should tell you in advance, in pounds and pence, the price hikes you’ll face during the contract period.
“Sky has side-stepped this from the start by saying it wouldn’t tell customers of the rises before they sign up, but instead when it does annual price hikes it will allow them to leave penalty free.”Now O2 is also dancing away, increasing contracts by more than it said it would when people signed up. And while that means all its impacted mobile customers can leave penalty-free – and many should – we know few will. Most will likely just have to suck up a rise that was more than they were told when they signed up.”The worry is now O2 has opened the door to this behaviour other mobile firms will feel less worried about following suit.
“It’s a great regret that when Ofcom consulted on these changes it didn’t listen to the proposal I and others made to simply ban above-inflation, mid-contract price rises (or any mid-contract rises).”And it’s worth noting the rises O2 had told customers of in advance were already usually far above inflation, but now will typically be at least 7% and up to 30%. And all this adds more inflationary pressure to the economy in its own right.”
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Mr Lewis also appeared on Good Morning Britain today (October 29) to raise awareness over the hikes, telling presenters Charlotte Hawkins and Ed Balls: “It’s absolutely ridiculous, O2 should be hanging its head in shame and I say most of its customers should be out there now – because you can leave penalty free once you’ve been notified of this – checking if you can get a cheaper deal elsewhere.”
He also urged Ofcom to put “some proper regulations in to protect consumers.
Mr Lewis added: “This is absolutely outrageous, people were told when they signed up they would get a price hike, they were told the amount and now their prices are being hiked more and the company can just shrug its shoulders and say ‘you can leave penalty free’ – but they won’t.”
In response to Mr Lewis’ concerns for consumers, the regulator Ofcom told GMB: “Our new rules are all about protecting consumers from volatile inflation and making sure they can shop around with confidence.
“Ofcom has never restricted how much providers can raise prices, that’s because the UK has a competitive telecoms market.”
An O2 spokesperson told the Daily Record: “With demand for mobile data at an all-time high, we’re introducing a 70p per month increase to annual price rises for O2 customers, effective each April.
“An annual rise of £2.50 a month – around 8p a day – continues to represent excellent value for services that customers are using more than ever before.
“We’ve again frozen prices on handset repayment plans and are investing £700m into our mobile network this year to ensure we meet growing demand and give our customers the fast and reliable connectivity they rely on.
“Customers on our social tariffs continue to be exempt from any price changes as part of our efforts to provide support to those who need it most.”
O2 also shared how other providers such as BT and EE have already hiked their annual price rises a few months ago, ahead of April 2026.
