Government plans to cut broadband costs for low-income households

People receiving benefits could save 'up to £100', the Government believes

The UK Government has announced plans to promote a social broadband tariff in an effort to lower costs for millions of low-income homes.

The Department for Work and Pensions (DWP) will oversee the new service, which will launch on the 22nd August.

It would enable ISPs to check consumers' eligibility for cheaper deals, with their consent.

Some ISPs already provide 'social tariffs' for people who receive social security payments like Universal Credit, which are less expensive than regular broadband and phone packages.

However, consumers often have to go through time-consuming verification procedures, like taking a screenshot of their Universal Credit payments page each month as proof that they receive benefits.

Only 1.2% of the more than 4 million families on Universal Credit had successfully registered for broadband social tariffs, Ofcom said earlier this year.

However, starting the next week, the Government will introduce a new scheme to streamline the process.

Rather than claimants sending proof they are receiving benefits, ISPs will be able to retrieve this information from the DWP.

The DWP will share the bare minimum of information: only the individual's eligibility for a qualifying benefit at the time of contact. Data about claimants will be kept 'as secure as possible'.

According to the Government, the new system is intended to increase public awareness and adoption of broadband social tariffs. The Government believes some consumers could save more than £100 annually.

Inflation has placed higher pressure on consumers' ability to afford rising internet bills.

A July 2022 survey by EY found that people have been cutting connectivity as they prioritise financial wellbeing.

Sixty-one percent of UK families who participated in the poll expressed concerns about their broadband provider raising subscription rates.

The Government is now urging all ISPs to promote social tariffs for recipients of Universal Credit and other benefits.

Virgin Media O2 said on Monday it would use the new system to confirm eligible customers have signed up for the Essential Broadband package. The firm will also not charge early termination costs for customers switching from current rates.

UK cost of living business tsar David Buttress promised that the Government would keep working with companies to expand and promote current social tariffs, as well as push for all providers to offer a reduced rate.

Social tariffs are vital for families with financial difficulties said Nadine Dorries, Secretary of State for Digital, Culture, Media, and Sport.

She added that the Government had secured commitments from UK ISPs to support consumers who are having trouble paying their bills and expensive contracts to stay connected.

"I urge anyone concerned about falling behind on payments to contact their supplier to see what support is available," she added.

Thérèse Coffey, Secretary of State for Work and Pensions, said the new system will make social tariffs simpler to access at a time when it is more crucial than ever that individuals get the financial support available to them.