TELECOM Eireann has predicted substantial savings to both domestic and business customers as a result of the capping of phone charges. But Fianna Fail and industry sources have accused the Government of protecting Telecom from real competition.
The decision to cap the charges of the State's dominant supplier - common practice in most EU countries - followed the European Commission's order last month that Ireland open up the business sector to more competition.
From next July, Ireland must open up closed-user networks, such as those held by the banks, the ESB, CIE and RTE. These can then be made available to Telecom's competitors, greatly increasing competition in the corporate telecommunications business.
Yesterday industry sources expressed concern that there was no specific provision to ensure that residential users benefited from the charge cap, or to stop Telecom directing all the reductions towards big business - the sector in which it faces competition.
Telecom denied this was its intention. "That is not the case - there will be substantial reductions to domestic consumers," a spokesman said.
ESAT Telecom said it was concerned at the lack of industry or consumer consultation prior to the Minister's decision.
He added that there had been very little detail in the Minister's statement, and that the company could comment fully only when such detail became available.
Fianna Fail criticised Mr Dukes's announcement, contrasting it with the demands of governments throughout Europe for real cuts in phone charges.
The party's spokesman on communications, Mr Seamus Brennan, said that Telecom "is being given an incentive to actually preserve the status quo until competition kicks in.
