Protection from 'shock' phone bills

Mobile phone users are to be protected from "shock bills" if their handsets are stolen, with a new cap on the maximum value of calls they will be expected to pay for.

Under an agreement between Government and four major mobile companies - EE, Three, Virgin Media and Vodafone - phone users will also gain a right to be informed if prices rise mid-contract and to break off the contract without penalty if they do not wish to pay the higher rates.

The companies - along with communications providers BT, Sky and TalkTalk, who have also signed up to the deal - have also agree to throw their support behind Government efforts to eliminate roaming charges in the EU by 2016.

The agreement is the latest move by ministers to help households struggling to pay their bills, as Mr Cameron attempts to neutralise Labour campaigning on what Ed Miliband has branded a "cost of living crisis".
The aim is for a new liability cap on mobiles that are lost or stolen will be in place from spring next year

No decision has yet been taken on the level of the cap, but aides indicated that it might be at a similar level to the £50 liability cap for stolen credit and debit cards.

The Government published proposals to help consumers with phone bills in the summer and in September announced the intention to develop a Telecoms Consumer Action Plan. Culture Secretary called in the phone companies last month for talks on how to protect customers.

Announcing the new measures as she accompanied David Cameron on his visit to China, Culture Secretary Maria Miller said: "We are ensuring hard-working families are not hit with shock bills through no fault of their own.

"Families can be left struggling if carefully planned budgets are be blown away by unexpected bills from a stolen mobile or a mid-contract price rise.

"This agreement with the telecoms companies will deliver real benefits to consumers and help ensure people are not hit with shock bills."

Consumer Affairs Minister Jo Swinson said "Most people now place large parts of their lives on their mobile phones - from friends and loved ones' numbers, to photos of great nights out.

"The last thing you need after the hassle of a stolen mobile is to find that someone has used it and landed you with a sky-high bill too.

"Phone companies have listened to Government and to their customers and I welcome their agreement to protect them from unexpected costs."