Telstra fixed-line rates to be capped for another 2 years

Telstra will be prevented from increasing rates payable on fixed line services beyond current caps for the next two years, with the Government to extend current price caps.

Telstra ACCCTelstra fixed-line phone calls and line rentals will be capped at their current maximums for an additional two years further two years under the Rudd Government’s proposed extension of price control arrangements.

Minister for Broadband, Communications and the Digital Economy, Senator Stephen Conroy said keeping the cost of local calls at 22 cents and a range of other measures were important protections for consumers.

“A draft amendment to the current legislative instrument is now available for comment on my Department’s website,” Senator Conroy said.

“The proposed amendment will delay the present expiry date of 30 June 2010 by two years, to 30 June 2012.”

The price controls set an upper limit on what Telstra can charge for fixed-line services such as local calls from residences (22 cents) and payphones (50 cents), as well as capping long-distance and international calls and monthly rental for a basic phone line.

“Extending the controls to 2012 will ensure that consumers continue to benefit from these protections,” Senator Conroy said.

Senator Conroy said while Telstra and some parts of the industry had argued that price controls should cease due to an increased take up of mobile services to the detriment of fixed line phones, the Government considered that consumer interests were best served by continuing to keep the current price caps in place for Telstra.

“The ACCC reviewed this matter earlier in the year and recommended the controls be extended by two years, and that their overall scope and composition not be changed. This review is on the ACCC’s website.

“The ACCC also made a number of suggestions for streamlining the current arrangements, which the Government has considered but decided against implementing.”

Details of the ACCC rejection of Telstra’s proposed price increases for fixed line services can be read in our article from May.

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