The cost of living crisis is continuing to hit many Britons hard in the pocket, and millions are looking for ways to cut back. However, Citizens Advice has warned that although people are doing all they can to be economical, some are still being punished.
Tracy, a woman originally from the US, spoke to the charity about her challenging circumstances.
She explained she is reliant upon disability benefits, and determined to keep her costs low.
As a result, she signed up to a £30 per month package including TV, landline, broadband and international calls in 2006.
When she worked through her bills this year, she was shocked to see it had increased to £80 over the years – and switched providers.
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“I have paid nearly £3,000 more for being a loyal customer.
“How on earth can they justify me paying so much more – especially as I was with them for 16 years?”
Citizens Advice has warned this is a common occurrence as one in seven Britons were found to be paying a “loyalty penalty”, despite the cost of living crisis.
The organisation has asserted tackling this penalty could be worth over twice as much as October’s £400 energy grant, or more than half the energy price cap.
Analysis of 165,000 budgets of people who came to Citizens Advice for debt help, found those with the lowest incomes spend almost double the proportion of their income on telecoms than the highest earners.
The charity found two fifths of those asked who are paying the so-called loyalty penalty have struggled to sleep due to worry about their finances.
Some three in 10 individuals said they have already cut back on essentials to cope.
As a result, Citizens Advice is calling on regulators to tackle the loyalty penalty to make sure no one is being punished for their loyalty.
Dame Clare Moriarty, Chief Executive of Citizens Advice, remarked: “The Government did the right thing by strengthening its cost-of-living help, but finally fixing the loyalty penalty could put more than twice as much money back in some people’s pockets as the £400 October energy grant.
“As we all pull together to weather the cost-of-living crisis, it’s incredibly frustrating to see there are still firms out there that prefer to help themselves than help the people who’re most in need.
“The time for piecemeal pledges has passed. Regulators must tackle the loyalty penalty across these three markets – no more excuses, no more delays.”