Sunday, February 01, 2009

The Orange Phone Fund Rip Off

UPDATE 3: 13rd December 2009

Important: The latest updates on this post can be found at this blog post.

Older updates remain on this page.

UPDATE 2: 19:12 3rd March

Orange lied to me.

I have just topped up by £10 to test and only received £10 (not £10.25) I've been moved onto the phone fund after all (a text from them after confirmed it). I've sent Orange a nasty complaint and asked them not to bother phoning me back or contact me. I'm now choosing my new plan with another network - the next time I contact them will be to get my moving code.

UPDATE: 3:09 1st Feb
Orange UK called me a couple of hours ago to fix things. The nice lady at Orange UK confirmed what I wanted to do (to keep receiving my tax as phone air time credit, not as a phone fund), put me on hold and explained it to the call centre, then transferred me across. The call centre lady then spent 5-10 minutes or so in total (with me on hold - not a problem as I wasn't paying :) ) to process the requests - I was informed that this needed some special attention (I can't remember the exact wording she used, but basically she needed to speak to someone who could implement/authorise the change to my pay as you go service plans).
This has been put through - I'll keep an eye out after Feb 11th to see if it worked!
To sum up, if you want to do the same put an email through the Orange system from their website, tell them you do not want the expense of you calling 450 customer representative (25p) to fix something you didn't want, and ask for a call back. If you still have any problems drop me a comment on this blog or on Money Saving Expect Forums where there are some posts on this issue.

Good on Orange for sorting this out quickly - I hope other readers will have the same success!

--- Original Post follows ---

I don't usually use this blog to complain, but this is one issue that gets up my nose and other people should be made aware of it - Orange is (in my personal opinion) ripping off pay-as-you-go customers out of a tax rebate.

Orange has recently sent me the text message

Hi from Orange. From 11 Feb, every £10 top-up gets you £1 towards a new phone with Orange Phone Fund. This replaces the VAT adjustment. See

At first I thought cool - I can get a free phone in a few years. What the text doesn't tell you (and is in the more detailed print at is that the fund is restricted to £200 and all funds accumulated reset after a year. Oh and you need to purchase the phone with Orange direct.

Yes, basically to get a £200 phone you need to spend £2000 in a year, even a budget phone is ~£1000.

So I complained via the Orange website that I was annoyed that they had automatically opted me in for a new plan for my two pay-as-you-go phones, yet I would never see any benefit because my phone purchase cycle is an environmentally friendly 8-10 years, and I would rather have the 25p on every £10 added to my account as had been done.

I received the quick response (within a couple of hours):

Dear Benjamin

Thank you for your email regarding the Phone Fund.

I am pleased to advise provide a better service for our customers and to give you better value for your money Orange Phone Fund will award you 10% back for every top-up made.

So if you top your phone up by £10 we will give you £1 towards your phone Fund, this gives you four times the benefit of the extra VAT credit.

Your Phone Fund builds over a maximum of 12 months with each top-up, until you decide to buy a new phone.

You can get a new phone by calling 450 or going to an Orange shop to cash in the fund towards the cost of the new phone. The maximum value of the new phone is £200.

However, if you feel that you would rather have the money as airtime on this occasion we can arrange for the credit to be applied back to your account. Please note that this would be at the rate of 25 pence (equivalent to the 2.5% VAT back) for every £10 topped up from 11 February 2009 and you would have to call 450 from your Orange handset or 07973100450 from a landline where one of our representatives will be pleased to help you.

For further information on terms and conditions please visit the link below:

Please be advised that the answers to many common queries can be found in the Frequently Asked Questions section in the Help and Support option on the Home page of our website

I trust the above is of assistance and sorry for any inconvenience caused.

Kind regards

Orange Customer Services

So basically I have to phone Orange to fix their problem.

So I rang up, went through the automated system to the final option 4 which is to speak to a customer service representative. At this point I was told I would be charged a "one off fee of 25p" - yes, that's right folks, now I would be paying for their error. I hung up the phone before it connected.

It then occurred to me, this is an Orange rep, at Orange telling me how I should fix a problem at Orange, i.e. it was deliberately scripted stock response, so I fired back a reply email:

Hi Wendy/Customer Services,

Thanks for your quick feedback. I cannot understand why the onus is on me and why *I* need to phone Orange to put right a situation Orange have created, when the information to fix it was contained in the first email (please see case number in email header for reference).
Nonetheless I have called Orange, got through the automated system to option 4, to be told I would be charged a one off fee of 25p to talk to customer representative. Is this some kind of scam to extort money? I did not go through with the process because of this however I am quite happy for a customer service representative to call me (with no reverse fee charge) on if it is a matter of the DPA.

Please can you either rectify this internally at Orange (rather than telling me how I can fix it) or call me directly on the aforementioned number. I should not be being charged, no matter the amount, or wasting anymore of my time putting right an *Orange* problem. If this cannot be arranged by yourself O2 are quite willing to give me free £30 pay as you go credit if I move my actual numbers over, and £60 (I have two phones) is looking very atractive at the moment.

Thank you for your assistance with this matter,


I have not received any further response or any calls from Orange, but that's okay. My next calls, which will cost me money will be to receive PAC codes to move my two phone numbers to get free 2x£30 credit with O2's move number feature, help move my finacée's number next month (whose Orange contract ends then anyway), and provide my parents with some free sims (curtesy of O2's free sims page)

Yes this may be overkill for £6-£18 extra credit on my phones a year, but it's the principals of:
- Changing my T&Cs without consultation to my detriment
- Poor customer service
- Onus on me to fix their problem (and wasting about 2 "person" hours in the process)
- Financial loss
- Large financial gain of moving to O2


Benjamin said...

For the anonymous person who left a comment just as I refreshed the blog (bottom posted below since I lost it from the comments) please note:

- I agree Orange did not have to give a tax rebate, but now a tangible benefit I was given (with the intention by the government to pass on to the public to help spur spending) taken away for increased Orange profits instead.

- I have documented the process for moving to another telecoms provider here for other peoples' benefit to help others and raise awareness.

What a waste of time. They are under no obligation to return the VAT. They didn't have to pass it on in the first place. They have given you something else in exchange of have offered to pass it on to you if you phone.

Anonymous said...

to speak to a humaniod indian CSR on 450 free, choose the option to top up, then having difficulties you get through FREE ;)

Anonymous said...

Personally i prefer the phone fund,
i think it represents superior value for money. 25p is only a couple of texts, thats all. I would rather have orange give me this phone fund. It has a higher value than a poxy tax rebate my friends. And just say you have £50 fund in 11 months time, isn't that better than say £12.50 worth of texts! plus only £30 out of yer wallet and you have a £80 phone. Great.

Benjamin said...

Superior value for money? That's either naïve or must coming from an Orange staff member! £50 of savings can easily be offset by inflated phone tariffs and prices in the Orange shop since you are restricted to buying in their store. We have a free market economy for a reason - so companies compete and we can get better prices via competition, don't be fooled into company propaganda at your expense. Orange are simply trying to tie you in to spending more with them and practice price discrimination for new sales.
My family saved so much money by getting off Orange it's just not funny and the individual savings are easily larger that any potential fund scheme. Quod Erat Demonstrandum.

Anonymous said...

The VAT decrease was not implemented for CONSUMERS! Get over it and get a life dude!

Your either 60 years old or sad and friendless. Phone fund is a great idea and a great system and despite the VAT going back up it is still in place.

Bet they had a right laugh over you.

Benjamin said...

LOL grow some "anonymous". WHAT RAGE YOU HAVE!!!! I bet you're a spoilt teenager who can only get his/her jollies from trolling anonymously on blogs.

Oh and you are really stupid...

Wikipedia says (and please note the part after the comma):

"It is a tax on the estimated market value added to a product or material at each stage of its manufacture or distribution, ultimately passed on to the consumer."

Better luck next time.

Anonymous said...

What a funny state of affairs, I have re-read these posts a few times and as far as I can see the only reason you would ever have for switching back is simply because you dont change your phone very regularly - I tend to get through phones every 12months or so, plus I do admit I like a nice new phone as well! - so the phone fund has been great for me I get a bigger benefit than before for doing the same thing and I have no problems buying direct from Orange - in this 'free market' you are right their prices have to be pretty good or I would go elsewhere - oh and to keep friendly I pop my phone on ebay and sell it to make a few pounds and offset the cost of the new handset even more.
But you keep racking up those 25p's ! as they say it all counts (just not enough for me)

Anonymous said...

lol he resorted to quoting wikipidia
and this is a diffrent peson to the one you have been arguing and sorry about the spelling im dysleyic

Benjamin said...

Quoting wikipedia is simpler than the indirect definition of "What is VAT?" as per HM Revenue instead:

"includes VAT in the prices they charge members of the public"

Now what really gets my goat at the moment is O2's 10% cashback, they might well have said "We're going to add an extra 10% to your bill because we're part of an oligopoly, but we won't give you it back as cash (after it's gained interest in our account), but as vouchers. Gee aren't we nice?" This is just labelling an extra charge as a benefit to mislead customers instead of them realising tariffs could be lowered.

Anonymous said...

Phone fund is a great idea indeed.
& infact theyve increased the expiry date for 15months now.
Its really a good deal which gives you value for the money you spend to top up. :)