Service disconnection for non-payment by residential customers

Guidance on how telephone companies can help consumers manage their phone bills and avoid being disconnected was published by Oftel and the telecoms industry in October 2002.

The guidance recommends that all telephone companies produce codes of practice that will give residential consumers advice on issues such as the payment of bills and how to minimise the risk of getting into debt. In particular, it sets out areas of policy that telecoms companies should address and provides standards of best practice in these areas.

The aim is for telecoms companies to promote consumer awareness of their disconnection procedures, and encourage greater consistency within the telecoms industry on such issues. The guidance was put together by the Disconnections Steering Group, chaired by Lady Pauline Ashley and including telecoms companies who have over ninety per cent of the residential fixed call market between them. They have agreed to follow the guidance in their future codes of practice on disconnection.

The guidance is in line with the Communications White Paper which stated that the telecoms industry should assume more responsibility for the payment of customer bills and disconnection levels.

Although primarily aimed at fixed telephone companies, the guidance sets out principles that could be adopted more widely by other operators such as mobile service providers.

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Disconnections data

The data below shows disconnections for non-payment per 100 lines less customers who have been re-connected in the quarter on payment of their bill. The data is collected quarterly and is audited externally. The data covers residential customers of direct switched services only. This measure indicates the extent to which an operator is effective in avoiding disconnections of telephony service for those customers who may have difficulty in paying their bills. The data follows the common definition of disconnections agreed by the industry and consumer groups:

"A disconnection is an action taken by the telecoms operator to prevent the customer both from making out-going calls and from receiving any in-coming calls. A customer who is left only with the residual ability to call the Emergency Services and/or the Operator providing their telecoms services is counted as disconnected for the purposes of this measure. Barring of outgoing calls only does not constitute a disconnection of service. Disconnections for non-payment are those disconnection actions taken in cases where the operator considers that the customer has failed to pay sums due for the telephony service provided."

The measure does not include cessation of service at the request of the customer, for example where the customer moves house or changes telephone company.

For further information, please contact Dave Parsons: tel 020 7981 3857 or email Dave.Parsons@ofcom.org.uk

Number of disconnections for non-payment per 100 lines (net) (disconnections minus reconnections), January 1998 to June 2002

	BT	Eurobell	Kingston	ntl (NTL Cabletel)	Telewest
Jan-June 1998*	1.5	*	0.5	6.9	2.8
Jul-Dec 1998*	1.5	*	0.3	5.0	5.0
Jan-June 1999*	1.4	*	0.2	5.9	5.0
Jul-Dec 1999	1.5	2.7	0.4	4.7	4.4
Jan-June 2000*	1.6	9.5	0.3	*	8.1
Jul-Dec 2000*	1.6	8.0	0.3	*	*
Jan-June 2001*	1.5	5.57	0.26	*	*
Jul-Dec 2001*†	1.6	2.5†	0.2	*	*
Jan-June 2002*†	1.3	2.24†	0.05	*	3.4†
Jul-Dec 2002*	1.2	*	0.2	*	3.32
Jan-Jun 2003*†	1.41	*	0.07	*	2.7

Net disconnections for non payment per 100 lines - January 1998 - December 2002

* Some operators' data not submitted, or excluded
† Some operators' figures are projected, based on half the period

Disconnections by BT

The figures below are as supplied by BT to Ofcom, broken down by both residential and business customers, and by the gross (total) numbers and net (disconnections minus reconnections) numbers.

BT quarterly disconnections for residential and business customers from April 2000

	Apr-Jun 2000	Jul-Sep 2000	Oct-Dec 2000	Jan-Mar 2001
Residential (gross)	259,928	288,255	232,749	273,158
Business (gross)	39,274	29,718	16,959	50,095
Residential (net)	171,666	196,067	153,108	187,553
Business (net)	19,025	15,530	7,846	19,267

 

	Apr-Jun 2001	Jul-Sep 2001	Oct-Dec 2001	Jan-Mar 2002
Residential (gross)	234,968	303,362	256,928	265,778
Business (gross)	47,290	65,907	72,060	107,175
Residential (net)	161,727	207,358	161,871	160,166
Business (net)	24,235	33,198	43,105	72,395

 

	Apr-Jun 2002	Jul-Sep 2002	Oct-Dec 2002	Jan-Mar 2003
Residential (gross)	252,179	281,688	261,665	282,933
Business (gross)	99,642	69,847	76,404	66,310
Residential (net)	158,044	147,732	132,090	154,193
Business (net)	34,077	12,870	13,314	18,577

 

	Apr-Jun 2003	1 Jul-Sep 2003
Residential (gross)	291,809	302,055
Business (gross)	46,375	45,697
Residential (net)	168,639	176,161
Business (net)	13,356	19,999