The cost of privatising Telecom Eireann has reached £73 million (€93 million) and is still growing, according to the Minister for Public Enterprise, Ms O'Rourke.

The figure is well in excess of the £40 million originally outlined in the Book of Estimates. The additional cost will need to be passed by the Dail as a supplementary estimate.

According to a spokesman for the Minister, the initial estimate was based on the Government selling 35 per cent of the company, but it ultimately disposed of its entire 50.1 per cent stake, thus increasing the money due to advisers, AIB and Merrill Lynch.

The two banks received £58.2 million from the proceeds of the float. Initial predictions had been for a £20 million fee which was later increased to £40 million.

Advertising also took up a significant portion of the bill at £3.2 million to Irish International Group. The PR and marketing bill came to £2.6 million for Citigate Dewe Rogerson. It is understood that Irish PR adviser, Drurys, may have received about £350,000 of this.

Replying to a question from Mr Noel Ahern in the Dail, Ms O'Rourke said the total cost has not been finalised but was running at approximately £73 million so far. This is approximately 2.2 per cent of the £3.3 billion raised in the privatisation, a figure broadly in line with international precedent. Goldman Sachs charged 1.752 per cent of the amount raised in the Singapore telecom privatisation, which was considered good value at the time.

The Minister did not comment on the fall in the share price which Mr Ahern said could seriously damage the Government's privatisation programme.

According to Ms O'Rourke, the Government would take a "practical rather than ideological" approach to the future of the State companies.

"We will examine the requirements of each of the State companies on a case-by-case basis."