Telstra call costs capped by Conroy

Communications Minister Stephen Conroy today announced an extension of price control arrangements on Telstra which will force the telco to continue charging 22c for untimed local calls from home phones and 50c from payphones.

The price controls had been slated to expire by 30 June this year, but in a statement released this afternoon, Conroy said a draft amendment would extend them by two years to 30 June 2012.

The controls also cap the price of long-distance and international calls and the cost of monthly line rental for a basic phone line.

"Telstra has always strongly supported continuity of consumer protections such as untimed local calls available to all Australians and all Australians should have access to a uniformly priced standard telephony service," said Telstra spokesperson Craig Middleton in response to Conroy's statement.

"The fact is many Telstra customers are paying less than 22 cents for local calls and several plans include all local calls. These prices are the result of a highly competitive market."

Conroy said the Australian Competition and Consumer Commission (ACCC) had reviewed the controls earlier in the year and recommended they be extended by two years and that their overall scope and composition not be changed.

"The ACCC also made a number of suggestions for streamlining the current arrangements, which the government has considered but decided against implementing," said Conroy. "Extending the controls to 2012 will ensure that consumers continue to benefit from these protections."

The minister said while Telstra and some parts of the industry had argued that price controls should cease, the government considered that consumer interests were best served by continuing to keep them in place. A more comprehensive review of pricing policy would be conducted in 2011 to assess how the National Broadband Network deployment will affect the industry.