Eircom criticised for 'unjustified' 3.8% price rise

EIRCOM PHONE charges will increase next month by an average of 3.8 per cent.

The move has been criticised as totally unjustified by consumer representatives and other phone service providers.

The Consumer Association of Ireland said Eircom did not have a great record in service to customers, and that customers should shop around. Smart Telecom claims it is just another way for Eircom to raise profits, because call costs have actually gone down.

The increase is the latest in a series of price rises, including a 17.5 per cent increase in electricity which came into effect yesterday and a 20 per cent gas price rise from September 1st.

From September 2nd, Eircom will change the way it charges for calls from the existing minimum fee charge of 6.65c including VAT, which includes a certain amount of call time, to a system where the call connection charge will be 5.95c with a further cost for every second of call time.

Prices will vary according to what phone package a customer is using and the time of day of the call. For example, a local call at peak time currently includes the connection charge and 77 seconds of call time. Under the new system all call time will be charged on a per second basis. Eircom head of communications Paul Bradley said the price rise was because "our costs are going up and we are coming in line with industry practice" in how they charge for calls.

He pointed out that line rental and broadband prices would not change and subscription rates for its talktime packages that bundle line rental and selected call categories are unaffected.

Mr Bradley said the 3.8 per cent increase was below the 5 per cent rate of inflation and was based on an average of business and residential call costs. He did not have the data available for the average cost increases in each sector.

Eircom reached agreement with the regulator on Thursday evening for the cost increases and also agreed to limit the impact on customers eligible for social welfare telephone allowances.

John Quinn, regulatory director for Smart Telecom, said the rise was "completely unjustified because the cost of voice minutes on the international market has actually dropped. So this is just another way of increasing profits."

He said consumers should check the callcosts.ie website, operated by the phone regulator, to find the best provider charges.

Michael Kilcoyne, deputy chairman of the Consumers' Association of Ireland, criticised the increase as "unjustified".