Social tariffs – how proactive should the telecoms industry be?

Soaring inflation has produced a ‘cost of living crisis’, with many UK households potentially unable to pay their bills, but what should providers be expected to do about it?

While the primary focus of the crisis is energy, which is in the middle of an inflationary perfect storm, other utilities are also coming under the spotlight. The inevitable shrieks of ‘profiteering’ and calls for a windfall tax on any company seen to be benefiting from this inflation have come thick and fast, with even grain companies being caught in the political storm.

For months the UK government has attempted to offset its own culpability in this crisis by coercing utility companies into softening the financial blow. Last April it specifically asked broadband providers to not only offer means-tested ‘social tariffs’ for household most struggling to pay their bills, but to find ways to increase their uptake. It seems merely advertising them isn’t considered enough and earlier this month the government urged operators to actively seek out their most needy customers and offer them these cheaper rates.

All this puts telcos in a tricky spot. They’re not responsible for the cost of living crisis and, like all other businesses, must seek profit. Lovely though it would be for everything to suddenly be ‘free’ at this difficult time, that obviously not viable, so the optimal level of philanthropy to be expected from them is tough to calculate.

A recent survey by data solutions firm Sagacity asked a bunch of senior telecoms professionals what they thought about the social tariffs issue. As you would expect, the majority of them made all the right noises about internet access being a basic human right and that there is a ‘moral duty’ to support vulnerable customers, but the consensus crumbled when it came to what, specifically, telcos should do about it.

68% of respondents said that while they feel for people that are struggling, if they want help, they should ask for it, rather than expecting the business to invest in tracking them down. That seems to be the sticking point between them and the UK government, with many people who qualify for social tariffs failing to apply for them. But 36% of respondents claim they don’t even have the data or resources to proactively find such customers.

“With the cost-of-living crisis worsening, and bills rising across the board, many households are struggling,” said Sagacity founder Harry Dougall. “And in today’s digital world, staying connected isn’t a ‘nice to have’ – it’s an essential part of everyday life, both personally and professionally. The industry needs to step up and do its part to help ease the burden.

“While there is broad agreement from people working in the industry that more needs to be done to ensure help gets to those that need it, many believe the onus should be on the customer to ask for help. But from our experience with identifying financially vulnerable customers, people are not always forthcoming in asking for help when it’s needed. This could mean millions are falling through the gaps.

“Taking a proactive approach to ensure that people know what support is available, using data to identify people that might need more help, will make all the difference. Yet to do this, organisations need to be able to join the dots across multiple datasets, both internally and externally. So a big step will be for telecoms providers to wrangle their data and apply an analytics layer which allows them to look for trends and spot anomalies that will help them to proactively support the vulnerable.”

It’s not clear from the press release whether Sagacity will be offering its own data services at a discount to do its bit towards the collective effort. And it’s not necessarily incumbent on businesses to resolve what is primarily a political problem. But as winter approaches and households come under even greater financial pressure, the telecoms industry may well conclude that being seen to do everything it can to help out is the politically expedient thing to do.

Get the latest news straight to your inbox. Register for the Telecoms.com newsletter here.