O2 price hike: Martin Lewis says mobile phone bill rise 'makes a mockery' of rules - here's what customers can do

The UK's largest mobile network has begun informing its mobile phone contract customers that their bills will be rising 40% more than they were told they would which Money Saving Expert founder, Martin Lewis, has said "makes a mockery" out of the rules put in place to protect consumers from mid-contract price hikes.

New rules brought in by regulator Ofcom in January put a ban on inflation-linked price rises but still allowed for annual mid-contract increases by a fixed amount.

At the time, Ofcom said: “As we have seen in recent years, inflation can be incredibly volatile and is difficult to predict. Our rules will protect consumers from bearing that risk, and ensure providers are clear about prices customers are obliged to pay over the whole contract period.”

The rules state any price rises written into a customer’s contract need to be set out “prominently and transparently”, at the point of sale. Providers must also be clear about when any changes to prices will occur.

However, O2 has just announced that in April 2026 customers who are mid-contract will face bigger price rises than those confirmed in their contracts. The £1.80 a month rise O2 customers were told to expect will now be 40% more at £2.50 a month, working out as an extra £30 a year.

Mr Lewis explained how big companies were avoiding falling foul of the new law while still increasing bills by whatever amount they choose. He said: "Sky has side-stepped this from the start by saying it wouldn't tell customers of the rises before they sign up, but instead when it does annual price hikes it will allow them to leave penalty free.

"Now O2 is also dancing away, increasing contracts by more than it said it would when people signed up. And while that means all its impacted mobile customers can leave penalty-free – and many should – we know few will. Most will likely just have to suck up a rise that was more than they were told when they signed up."

A spokesperson for O2 said even after the price increase, the cost “continues to represent excellent value” to customers. They said: “With demand for mobile data at an all-time high, we’re introducing a 70p per month increase to annual price rises for O2 customers, effective each April. An annual rise of £2.50 a month – around 8p a day – continues to represent excellent value for services that customers are using more than ever before.

“We’ve again frozen prices on handset repayment plans and are investing £700m into our mobile network this year to ensure we meet growing demand and give our customers the fast and reliable connectivity they rely on. Customers on our social tariffs continue to be exempt from any price changes as part of our efforts to provide support to those who need it most.”

How to avoid O2 price hike

If you are affected by the price hike - which is almost all O2 customers - you don't need to just sit there and take it. The Money Saving Expert website has advice on not only avoiding the increase but potentially saving money too.

They advise that anyone who joined O2 before October 23, 2025, when the price rise was announced, has the right to leave their contract penalty free. Ofcom's rules state if a company makes a negative change to the terms of a contract - such as an unexpected price increase - customers have the right to leave the contract penalty-free within 30 days.

The money website's advice is to use that time searching for a cheaper deal - you can find a list of options one the Money Saving Expert's website - some providers even 'piggyback' on the O2 signal including Giffgaff, Sky Mobile and Tesco Mobile.