I get quite high lag when I am using my router, usually rebooting it fixes it for a few hours, but it goes back to high lag after. I have tried PPPoE into the openreach modem directly, had fine ping. I also tried a different cable and it has not changed anything.
About every minute or so, my ping will reach from 10ms (which is normal) up to about 4500ms.
Am I going to need to buy a new router?
I should also state that I used FREEping to calculate my ping to Google's DNS 126.96.36.199
Fixed! Go to the fix.
I assume that what you are saying is that you do not have the lag issue when you connect a computer directly to the modem. Hence indicating that it's a router issue.
If you talk to Plusnet they may, in exchange for a contract extension, offer you new router for the P&P cost. Do not bother if all they will give you a Hub Zero. If you can get a Hub One you will no longer need the BT modem. If Plusnet will not give you one do not buy from them but go to Ebay where one can be bought very cheaply. Either a Hub One or BT Home Hub 5a or b will do the job but a BT Smart Hub 6 (make sure it is the FTTC version that has four yellow LAN sockets with NO red WAN label stuck to one of them) will give much better wireless performance.
These are easy to set up and instructions can be found in the router forum.