Telecom under scrutiny for raising household bills

Telecom faces the prospect of a Commerce Commission investigation over rising home-phone rental charges.

The possible probe followed a complaint by a member of the public, a commission spokesperson said yesterday.

In January, Telecom announced it would raise home phone rates by 5.5 per cent, or about $2.35 a month, for about 700,000 customers starting next month. The move is expected to boost revenue by $10 million a year.

Telecom said yesterday that the possibility of an investigation by the regulator was stated in the company's half-year result, reported on February 2.

The prospect of an inquiry first became public after the Bloomberg News agency reported that Telecom had disclosed the information in a filing with the US Securities and Exchange Commission on Monday.

If the regulator finds Telecom guilty of anti-competitive behaviour it could seek remedies including fines, damages and an injunction.

The price increase will not apply to customers on the Anytime, Budget Link and 60s Plus calling plans.

The standard monthly HomeLine rental fee will rise from $39.85 to $42.20.

In Wellington and Christchurch, where rival TelstraClear operates, the fee will rise from $32.85 to $34.80 a month.