Telecoms regulator, ComReg, yesterday gave the go-ahead for a 7.5% rise in Eircom's monthly phone line rental charges from February 4 the third increase within a year.
Eircom's line rental charges for residential consumers are currently the highest in the European Union at €22.50. When this latest increase comes into effect, the charge will rise to €24.18.
The Consumers Association of Ireland (CAI) said the latest hike was unacceptable and unaffordable and they called for competition to be brought into the landline market immediately.
"This is just another rip-off of Irish consumers and ComReg must act immediately to force Eircom to allow competition into the land line market," CAI chief executive Dermott Jewell said.
ComReg has instructed Eircom to bring in a wholesale line rental scheme that will allow competitors like Esat BT and Ocean to offer Irish consumers a full package of phone calls and line rentals.
These companies are offering Irish consumers alternative call charges, but cannot offer them line rental charges because the system they operate is not compatible with the wholesale line rental scheme Eircom is offering them.
But Eircom insisted yesterday that it has offered competitors a wholesale line rental scheme since last June but only one competitor has taken it up.
"ComReg has asked us to change elements of our system so that it can be compatible with other competitors who want to enter the market and we are working on that," Eircom commercial director David McRedmond said.
A ComReg spokesman said they are actively promoting competition in the market and other competitors will be able to use a new wholesale landline scheme by mid 2004.
Labour's communications spokesman, Deputy Tommy Broughan, accused Eircom of "utterly exploiting" consumers.
And IFA Telecoms director of organisation Pat Smith accused Eircom of cross-subsidising other services with the latest line rental increases.
But Eircom yesterday defended their charges. Their residential and business phone bills had fallen sharply since 1997 and were now amongst the cheapest in Europe, Eircom said.
Mr McRedmond, said: "I am incensed by this constant claim that we are ripping off our customers Eircom's residential and business phone bills overall have fallen sharply in real terms since 1997 and are among the cheapest in Europe."
However, Mr McRedmond did admit Irish line rental charges were among the EU's highest, but said population density in Ireland was far lower than in other European countries.
Eircom's line rental charges would help fund investment in a better telecoms system, including the improvement of broadband services, Mr McRedmond said.
Eircom's charges are governed by a price cap and its total basket of line rental and phone call charges cannot increase more than the rate of inflation, currently running at 2.2%.
There was a 11 million reduction in call charges last year and overall phone prices in the past year have risen in line with inflation, representing an overall average increase of 3% for residential customers and 2% for commercial customers, Mr McRedmond said.