TELECOM Eireann has cut the cost of national long-distance calls by 10 per cent and has reduced a range of international call charges by up to 37 per cent.

The moves form part of an initiative designed to cut £20 million off the nation's phone bills in what is the first stage of a price reduction campaign for 1996.

"This is the first big announcement in 1996 but it is by no means the last. You will see further price reductions throughout the year," the chief executive of Telecom Eireann, Mr Alfie Kane, said yesterday.

The cut in long-distance domestic costs will take effect from tomorrow. It means that a one-minute standard "B" rate trunk call, which now costs 24p per minute, will cost 22p per minute. The cost of reduced-rate calls will fall from 16p per minute to 15p per minute.

"These reductions follow similar initiatives throughout 1995," Mr Kane said, adding that the cost of trunk calls had fallen by 21 per cent ever the past six months.

Telecom is also cutting the cost of calls to Australia and New Zealand by 20 per cent - a move which will take effect from February 7th.

The price of calls at the standard rate will fall from 110p to 88p per minute, while the cost of reduced-rate calls will fall from 85p to 68p per minute.

The largest of the reductions announced yesterday affects calls to the Middle East. From March 6th the cost of calls to countries such as Jordan, Oman and Syria will fall by 37 per cent. This means that the average price of a call will drop from 174p to 109p per minute.

The price-reduction package will also affect the cost of calls to the near-European countries: Belgium, France, Germany, Luxembourg and the Netherlands. From March 6th the price of calls to these countries will fall by 10 per cent.

Mr Kane said Telecom had not yet finalised the nature of reductions to be announced later in the year. "Future reductions will be decided by the marketplace. We will have to respond to competition as and when it occurs.

It is understood that the level of reductions this year will be similar to last year, when £64 million was cut from the cost of calls. Telecom is likely to continue to reduce the cost of trunk and international calls and to introduce further volume discounts for large business users.

Over the past 12 months, Telecom Eireann has cut 13 per cent off the cost of business calls, a spokesman for the company said. He added that in the previous 18 months business charges had been reduced by 12 per cent.