Minister defends mobile fee hike

Defending the Federal Government's plans to increase mobile phone carrier fees by almost 160 per cent, IT Minister Senator Richard Alston said it would cost users as little as one cent a day.

Alston said: "No one would notice the extra cost" because it will rise "infinitesimally".

"Bear this in mind, with 10 million GSM users this fee increase represents less than one cent per user per day, which is the equivalent of two seconds of air time," he said.

"We're talking about an increase from $21 million to $53 million which is less than one per cent of the $7 billion in revenue that the three telecommunications companies derive each year."

Telstra, Optus and Vodafone have expressed concern about the increase, warning they wouldn't be able to absorb the whole cost without passing it on to users.

Alston said carrier fees haven't increased since 1992 and a price hike in this Tuesday's budget is an attempt to recoup a fair market return.

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