Telecom today announced a price rise on monthly residential line rental.

The price will increase from $38.05 to $39.30 including GST -- an increase of $1.25.

Rentals in the Wellington calling area and Christchurch and most of its suburbs will rise from $31.35 to $32.40 -- an increase of $1.05.

Telecom said the increase was in line with the Consumer Price Index (CPI), which measures inflation.

Customers will see the increases in their February 2003 accounts.

Telecom spokeswoman Sandra Geange said although local calling was increasing dramatically because of people accessing the internet, Telecom was constrained under the Telecommunications Service Obligation (TSO) as to how it could recover the cost involved.

"The only way... is through this moderate increase in monthly line rental in line with the CPI," she said.