Mobile phone users will be forced to pay higher prices if the government goes ahead with plans to increase mobile spectrum licence fees by 150 per cent in the forthcoming budget.
Labor's communications spokesman Stephen Smith said although Optus, Telstra and Vodafone will have to bear the initial cost burden, price hikes will be passed on to consumers.
His comments follow media reports the annual fee for using 900MHz spectrum, which is used for the GSM network, will rise in next week's Budget.
Labor said the increase would net the government an extra $120 million over four years at the expense of an estimated 10 million customers of the GSM network.
A spokesman for Communications Minister Senator Richard Alston was not immediately available for comment.