Communications Minister Steven Joyce has denied suggestions that the Government has plans to put an end to free local landline calls.
The Government has been accused by Labour of contemplating the move in a Cabinet paper prepared by Finance Minister Bill English looking into reviews of regulatory regimes.
The paper says a wide review could consider abolishing the framework of the Telecommunications Service Obligation, which guarantees free calls between local landlines.
Mr English also mentions scrapping Kiwishare restrictions relating to foreign ownership of Telecom.
The Labour Party says the paper could spell the end of free local calls.
But Mr Joyce says that is way off the mark and the Government is simply looking at identifying opportunities to improve competition.
He says there are no plans to axe free calling or change ownership regulations.
The Cabinet paper says potential improvements were found during the last service obligation review under the previous government but more could be identified in a wider review.
It says a review led by the Economic Development Ministry could consider abolishing the Telecommunication Service Obligation framework.
Labour Party communications and IT spokesperson Clare Curran says the issue needs to be debated.
Ms Curran says she also takes issue with the paper saying that scrapping restrictions relating to foreign ownership of Telecom would open up opportunities to overseas shareholders for capital injection.