Eircom has reduced a number of its national and international call tariffs but increased its monthly line rental fee. The company said the reductions, which take effect on April 17th, would cost it £53 million (€67 million).

Eircom's monthly line rental fee goes from £12.39 to £13.21. This includes value added tax (VAT) at 21 per cent.

Asked why this charge was rising, an Eircom spokesman said: "Increasing line rental is something every telecoms company in Europe is doing."

The development of the line network represents "the bulk" of Eircom's investment, he said, adding it was necessary to increase the rental fee because this was a facility used by the company's competitors. "We can't continue to subsidise our competitors."

The company said the maintenance cost per line was almost twice the line rental charged to customers. "The line rental charge is a contribution to the cost of maintaining the provision of infrastructure connecting each customer to their local telephone exchange," it said.

Local call charges will not be affected by the reductions in call charges. The charge for long distance calls will decrease from 10p to 7.4p per minute during daytime, including VAT. These calls will cost 4.9p per minute at evenings, down from 6.7p. Weekend calls from fixed-line telephones to mobile phones will cost 12p per minute, down from 15.4p.

An Esat Clear spokeswoman said it charged 5.1p per minute, including VAT, for local and national calls at peak times. At off-peak times, these calls cost 2.5p per minute.

Eircom's spokesman said its latest initiative was not a response to price cuts introduced by competitors. "What it is doing is setting the agenda for our competitors," he said.

The spokesman claimed the package would reduce the average domestic phone bill by 2.5 per cent and reduce the average commercial bill by 4 per cent.

Eircom calls to Britain at peak times will be charged at 12p per minute, down from 16p, and at 11.4p per minute during off-peak periods, down from 15p. The new weekend rate for calls to Britain is 9.8p per minute, down from 13p.

Esat Clear charges 13.9p per minute for peak-time calls to Britain and 10.9p for evening calls. The weekend rate for calls to Britain is 9.7p per minute.

Last month, the US firm Cable & Wireless introduced a 5p flat rate for business customers for national calls and calls to Britain.