Bob Baldwin (Paterson, Liberal Party, Shadow Minister for Defence Science and Personnel) Share this | Hansard source

I rise to speak on the Telecommunications Legislation Amendment (National Broadband Network Measures No. 1) Bill 2009. Let me say from the outset that the coalition has some very serious concerns about this bill and with the government’s entire approach to its proposed National Broadband Network, an approach which will disadvantage millions of Australians and business whilst, yet again, plunging the national economy further into debt.

This bill seeks to amend part 27A of the Telecommunications Act 1997. Part 27A of the act that enables the minister to require telecommunications carriers to give information to the Commonwealth about their telecommunications networks. Whilst we, the coalition, support improved broadband services, we are yet to be convinced that the government’s latest proposal can or will be delivered, and at what cost, given its massive price tag and potential contribution to Australia’s record debt levels, especially given the failure of NBN mark 1.

Earlier this year the government announced that it had abandoned its election commitment for fibre-to-the-node broadband and the associated RFP process and would establish a company to own and operate a fibre-to-the premises broadband network with a potential price tag of $43 billion. Nobody denies that fibre-to-the-premises broadband, as proposed by Labor’s latest plan, is a premium service, but it comes at an enormous cost to Australian taxpayers.

In light of these changed goal posts, this bill seeks to amend the existing provisions of the act to include the provision of information by utilities as well as telco carriers for the purposes of NBN mark 2. The bill proposes that the information of carriers and utilities be utilised not only for the implementation study but also potentially by the NBN company or its potential subsidiaries or partners for any actual rollout of the network over the next 10 years.

This notion is absolutely absurd. It disadvantages telcos and energy providers that are continually trying to stay afloat in a competitive market—the same telcos and energy providers who, for the most part, despite being key stakeholders in relation to this bill were not consulted prior to it being put on the table by the Rudd Labor government. In fact, many of them did not hear that they would have to pass on such delicate information about their businesses to government until contacted by media for their thoughts. This is truly concerning and a testament to the Rudd Labor government’s inability to manage such massive projects.

These stakeholders, whilst agreeing to cooperate with the government on the provision of necessary information, have indicated they have a number of concerns about the potentially broad and onerous requirements that could be imposed on them by the minister under this legislation.

The Senate Committee on Environment, Communications and the Arts received nine submissions on the bill and held a public hearing in Canberra. Submissions were received from Telstra, Optus, Energy Networks Association, the Business Council of Australia, the Australasian Railway Association, the Water Services Association of Australia, Integral Energy, the Office of the Privacy Commissioner and Unwired.

The committee received information which highlighted the various concerns stakeholders hold in relation to proposed amendments in this bill. Many of the stakeholders were concerned that the proposals offered little protection regarding information being passed on to the government. They were also concerned that no competitive advantage should be gained by the NBN Co through the proposals in the bill, which potentially gives the company access to utility and carrier network information over the next ten years.

Along with industry, the coalition thinks that this is an unreasonable request and is calling on the government to limit the application of this bill to the implementation study only. Also of grave concern to the coalition is the government’s steadfast refusal to conduct any cost-benefit analysis for their NBN mark 2 proposal. The coalition and a vast majority of the Australian public are up in arms over the $20 million price tag blow out of NBN mark 1. I suspect many Labor MPs would also be very embarrassed by this figure.

However, there is also every indication that NBN mark 2 will go the same way, only this time we are not talking about a cost blow out of $20 million but rather a now projected $43 billion blow out. That is right: $43,000 million of taxpayers’ hard earned cash wasted, simply because the flailing Labor government will not do a cost-benefit analysis to prove that this is able to be afforded and that they are able to manage such a large-scale project.

Forty three billion dollars is an enormous figure to spend on any project and this Labor government must do the necessary research to warrant such a massive taxpayer spend to ensure the proposed NBN mark 2 project is cost effective and a viable way forward. The Rudd Labor government’s arrogant approach should worry all Australians.

In its submission to the Senate committee, the Business Council of Australia joined the growing list of concerned commentators and organisations, including the Productivity Commission, who believe the NBN needs a thorough cost-benefit analysis. In its submission to the inquiry the Business Council of Australia stated:

Without a proper consideration and estimation of costs and benefits, it is difficult to see that the government has provided sufficient justification for the proposed legislation.

What would constituents get for this $43 billion price tag? Thousands of residents across the Paterson electorate and, indeed, millions of people across Australia, will incur dramatically increased broadband access costs. Industry predictions indicate that consumers may have to pay more than $200 a month to use Labor’s proposed National Broadband Network, a concept supported by analysis conducted by the highly- regarded economist and Concept Economics chairman, Henry Ergas.

To add insult to injury, Labor’s grandiose NBN plan is very scant in detail, and it has been made perfectly clear by the Prime Minister that towns with fewer than 1,000 people will not receive high speed fibre-to-the-premises broadband services despite the project’s record-breaking price tag. This means that, despite the government racking up a huge amount of debt, they are not spending on projects which are aimed at stimulating the economy and inclusive of the entire community.

In the Paterson electorate alone, the townships of Boat Harbour, Brandy Hill, Clarence Town, Coomba Park, Green Point, Gresford, East Gresford, Hinton, Karuah, Nabiac, North Arm Cove, Pacific Palms, Blueys Beach, Paterson, Pindimar, Salt Ash, Seaham, Smiths Lake, Stroud and Wallalong will miss out on upgraded broadband services. Conversely, the coalition has always been committed to ensuring that all Australians have equitable access to fast, reliable and affordable broadband services. Residents in these small communities who are to go on without upgraded broadband services are not faceless names—at least not to the coalition. Take, for example, a constituent of mine at Brandy Hill, Mr Arneson, who is bitterly disappointed that the Rudd Labor government has not done more to enable him to access broadband from home. In relation to this matter, Mr Arneson commented:

I could not obtain an ADSL broadband connection where I live, and had to suffer a very slow service as a result. The promised 3G service was slow coming, and also did not work in many areas around Brandy Hill, forcing me to use a satellite service, which, because it is connected via an Optus satellite, also has some problems. The 3G solution might be the way to go, but it is almost three times as expensive as the satellite service, and thus, as a pensioner, out of my price range.

So I ask the question: at $200 a month for the government’s new plan, how will a pensioner be able to afford that? I should also mention another constituent of mine, Mr McDonald, a Port Stephens resident who was disadvantaged by a lack of broadband services in his area. Mr Mc Donald had this to say:

As a young person with a physical disability who is self-employed, I need ADSL not for leisure but for my business. I would like to be treated fairly and have the same access to ADSL as everyone else has.

I can and will continue to prove to the House how the Rudd Labor government’s mismanagement of the NBN service is disadvantaging constituents in my electorate. Earlier this year I received a letter from a constituent in Thornton who had this to say:

I have been trying for nearly two months to get broadband up and running. At present, I am waiting (not-so-patiently by now) for Bigpond to send me a second, more powerful signal booster, in the hope that most of the powerful boosters they can provide will allow me better dial-up speed, and stop the somewhat-regular signal drop-outs I now suffer.

Labor are apparently only too aware of the problems associated with broadband in the Thornton area. Before Labor came into government, the member for Newcastle had this to say in an address to the House on 15 February 2007:

There are a lot of infrastructure needs in our area and of course broadband remains absolutely critical. One constituent wrote:

Having just moved into a new housing estate [I am concerned about] the lack of availability of broadband access …

Another Thornton resident said:

We applied for ADSL Broadband about 2 years ago and are still waiting.

So whilst these appropriations must of course go through, I join with my Labor colleagues in taking the opportunity in this debate to point to the wasted opportunities of the last 10 years. It is about time this government changed its direction. I know it will not, so we must change the government. The Australian people have the opportunity later this year to say: ‘Let’s have that change. Let’s get rid of this government and vote them out of office.’

So tell me, member for Newcastle, why, when you have been in government for the past 22 months, are constituents from the Thornton area still writing to me complaining about infrastructure in the region?

The other falsity being put forward by the government is that the opposition did nothing in its 12 years in government. Mr Deputy Speaker Slipper, you were in the House during that period. Dial-up broadband did not really come online until 1997-98 and ADSL was not even introduced to the Australian market until 2001-02. So again they base their argument on false information.

Going back to the comments from the member for Newcastle: if the lack of broadband was the basis on which she sought to dethrone the former Howard government, will she announce that the Rudd Labor government is ready to pass over the reins? This is absolute hypocrisy on the part of a government which cannot provide broadband services in the Thornton area, yet has managed to waste $22 million of taxpayers’ money on disappointing, half-hearted attempts to do so.

I now draw the House’s attention to yet another example of a Great Lakes resident who has been left disillusioned by the Rudd Labor government’s inability to set up broadband services in his area. He wrote:

Recently I lost my broadband connection when I looked to change my server from AAPT to Telstra. During the cooling-off period, I found I was better off with AAPT. When I tried to change back, I found my broadband connection had been cut off and there were no more broadband ports available at the Forster exchange for any server.

I could go on, but, keeping in mind the time limits available for debate, I will press on.

It is important to remember that, whilst the Labor Party have been elected into government to represent the needs of all Australians, it seems they are doing a particularly good job of pandering to the needs of marginal Labor seats and forgetting about those electorates held by Liberal or National party members. Traditionally, townships with fewer than 1,000 people have been represented by coalition members. At present, 60.4 per cent of these towns are in coalition-held seats, so it seems convenient that Labor has excluded them from their NBN mark 2 plan. It would seem that Labor is monopolising which electorates the majority of taxpayer’s funds are being injected into to ensure that they safely manipulate voting outcomes at the polling booths on election day. This is where the coalition differs from Labor. It has always been our mission to ensure that all Australians have access to fast, affordable and reliable services with the most cost-effective use of taxpayers’ funds.

Labor promised it would select the network builder for its broadband network within six months of coming into office. Yet, 22 months into their term, neither construction into these services nor connection is still available for many disadvantaged residents in the Paterson electorate. This is in stark contrast to the coalition’s thorough and cost-effective broadband strategies. The former coalition government had a firm plan to deliver affordable and high-speed broadband services to the entire population by the middle of 2009, meaning that under the coalition this argument would be null and void, as many Australian that had wanted broadband access would have it today.

This would have all been possible under the coalition’s plan to include a targeted rural and regional Australian broadband plan, OPEL, which would have seen the Commonwealth invest $958 million to deliver new metro-equivalent broadband services to in excess of 500,000 underserved premises across the nation. The Paterson electorate would have been directly benefited by these plans as the coalition stood firm on their promise to deliver 25 new WiMAX base stations and eight telephone exchanges upgraded to ADSL2 broadband in the region. Furthermore, OPEL would have delivered new metro-equivalent broadband services to around 22,750 underserved premises. Disappointingly, the Rudd Labor government inexplicably cancelled this project despite having no real alternative to it. Also interesting to note is that, whilst Labor promised at the last election that they would have their broadband network operating by the end of 2008, they have failed. The last 22 months have been wasted by Labor due to their poor planning and incompetence. During this time, their National Broadband Plan has also become increasingly irrelevant, with more and more people taking up wireless internet services, making a cost-benefit analysis into the NBN mark 2 plan even more poignant.

The relevance of broadband has been further placed in the spotlight after comments from BBY Telecoms analyst Mark McDonnell, as reported by Communications Day, who has told a major industry conference that Labor’s National Broadband Network proposal is ‘lacking in any measure of financial or commercial rigour’. Furthermore, he said:

More to the point, no one has yet provided any real evidence relating to unmet demand for 100Mbps broadband delivery for the household. No one from government has been able to give any clarity on the prices consumers or wholesale customers could expect to pay.

The analyst said that without clarity investors would steer clear of the NBN:

Few analysts have been moved to describe it as a rational investment proposal … When it comes to risk, this is about as high risk as it gets.

Stephen Conroy and other NBN proponents have ridiculed the proposition that consumer prices of up to $200 per month would be needed for broadband to cover the costs, but completely avoid giving any statements as to what it could or should be.

Mr McDonnell’s comments are especially poignant given that in the June 2009 quarter around 640,000 new wireless broadband subscriptions came online, compared to around 80,000 fixed line subscriptions. As my colleague, the shadow minister for broadband, communications and the digital economy pointed out:

This trend cannot simply be ignored by the Rudd government, but the reality is Labor has no idea how many customers will choose wireless services over fixed line in the coming years and what impact this will have on the viability of its NBN.

The coalition fully recognises the importance of universal access to fast, affordable, reliable broadband; we always have. We also fully support the continued enhancement of broadband services so that constituents in townships such as Boat Harbour, Brandy Hill, Clarence Town, Coomba Park, Green Point, Gresford and East Gresford, Hinton, Karuah, Nabiac, North Arm Cove, Pacific Palms and Blueys Beach are not disadvantaged.

Whilst Labor now begin to start a new process from scratch to implement their National Broadband Network, we must ask ourselves at what cost. This program comes with a $43 billion price tag; $43 billion of money that we as a nation just do not have. And the bigger question of what timeframe it will all be delivered in is yet to be addressed with any surety. To quote from an article in the Sydney Morning Herald on 9 September in the Business News section, it says:

In a recent report entitled Navigating the Path to Australia’s NBN, a Goldman Sachs JB Were telecommunications analyst, Christian Guerra, predicted the network roll-out would not begin until 2011, and by 2017 it would pass only 50 per cent of homes. Mr Guerra thinks the Government’s target of 90 per cent will not be achieved until 2025.

So the government’s so-called action plan is, according to the article:

… [a] study by McKinsey & Company and KPMG which will not be finished until February 2010. This report will address network design, governance, ownership caps and ways to attract private sector investment.

I have to ask: when will rural and regional areas receive the much announced prior to the election broadband service? What the Australian public has witnessed is a litany of time delays and cost blow-outs, both of which will disadvantage the Australian public and business alike, particularly in regional and rural areas with little or no access to acceptable transmission rates.

On top of this, the cost is anticipated to be around $200 per month. This is an expensive option that I cannot imagine those on low incomes, pensioners or farmers struggling to survive on the land being able to afford. This is also a program that is city-centric at the expense of those in regional and rural Australia, particularly those in towns of less than 1,000 people. And that is where we, the coalition, come in; we are urging the Rudd Labor government, which has a history of reckless spending and project mismanagement, to do a full cost-benefit analysis and to ensure that they get key stakeholders onside, before pressing ahead with this controversial project.

The constituents in my electorate, particularly those in townships of less than 1,000 people, deserve better broadband services. They need cheap, reliable and easily accessible broadband services that will enable them to communicate online and connect with people around the world for work, play and leisure. The reality is that for those in towns of less than 1,000 people, they will get no better service than what was promised by the coalition and on the way to completion by mid-2009. Under this new NBN mark 2 scheme, as stated in the report, they may not see any action until 2025. They do not need their broadband bills escalating to ridiculous prices of $200 a month for inadequate services.

Broadband is not a new technology, and the Rudd Labor government needs to go back to the drawing board and keep in mind that they have been elected to represent all Australians, Australians living in urban and suburban dwellings as well as regional and rural areas, and not to forget those companies that are trying to survive in the competitive telco and energy industries. (Time expired)

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