The stand-off over the charges paid by European mobile phone users when they travel abroad is set to heighten after Britain warned other European Union countries against imposing “rigid” caps on mobile phone roaming charges, raising the political temperature ahead of a meeting of EU industry ministers in Hanover on Thursday.

The UK government is concerned that a sweeping proposal forcing operators to slash roaming rates by as much as 70 per cent will undermine competition and innovation in the sector. Though London says it supports the drive in principle, Margaret Hodge, UK industry minister, warned that parts of the proposal may lead to “horrendous” costs of up to £2bn (£3.9bn, €2.9bn) for industry without offering real benefits to consumers.