Wilson Tuckey (O'Connor, Liberal Party) Share this | Hansard source

This Telecommunications Legislation Amendment (National Broadband Network Measures—Network Information) Bill 2009 is interesting legislation for the precedents it creates, the purpose of its very large sums of government money, the priority of government spending and other matters relating to the normal practice of business. It is interesting to consult the history of this matter. The Rudd opposition, as it then was, went to the last election saying that for $4 billion it would provide a fibre-to-the-node network throughout Australia. No doubt a lot of people were interested in that concept, and to those people in the industry $4 billion would not be much—and that might have influenced their vote. The government then went to tender on this principle—I think it was $4 billion or it might have been $8 billion; it does not matter—and said to the operators of electronic communication systems in Australia, ‘We will give you this money if you will build it.’ They called for tenderers and of course the biggest provider, Telstra, looked at it, realised that it could not get within a bull’s roar for that sort of money or with that sort of subsidy considering the areas of market failure that would be involved and eventually lodged a non-conforming tender for which they were strongly criticised. Their competitors also lodged tenders.

It appears they were all non-conforming tenders because one day there was a press conference and the government said, ‘We have scrubbed all that. It is going to cost $44 billion, not $4 or $8 billion subsidised. Nobody has come anywhere near it.’ They did not say a kind word about Telstra who had come to the commercial judgment that their shareholders could not carry the burden of what the government promised for the money that was available. As a result of all that, the government announced on 7 April 2009, as the minister advises us, that it would establish a company—a commercial enterprise—NBN Co. Ltd. I have never seen a government enterprise that was limited. As money is required they just keep pouring it in. But it is limited! They announced that they would invest up to $43 billion in partnership with the private investors to build a new superfast fibre optic based national broadband network. So the government is going in to business. It expects to attract some partners at a point of about 49 per cent. There are some very well-known comments made by big business about investing in something and always having 51 per cent, but the government proposes to retain 51 per cent.

The next thing we find is this House debating—and I do not think the coalition is necessarily opposed—over entitling a business owned by the government to have access to its competitors’ commercial-in-confidence information. It is amazing that BHP has not rung up and said, ‘Can we have that on Rio? Can we go in and search their books?’ I find it astounding that in this current climate a government is saying, ‘We are going to run a business but we are going to have the opportunity to virtually commandeer other people’s commercial-in-confidence information.’

When we go to the explanatory memorandum we find that:

The Bill provides that the obligation on carriers and utilities to provide specified information to an authorised information officer would apply for a period of 10 years. Although it is anticipated that the roll-out—

of the proposed business outcome—

… will occur over an eight-year period, this provision permits flexibility.

It sure does—even if you have got the company up and running, you can still go and access your competitors’ information. There are also a couple of clauses referred to in the explanatory memorandum designating to whom this information will be disclosed. It is headed ‘Disclosure to and use by entrusted public officials.’ So there is apparently someone in the public service to whom this information will be given so that, one would think, it will not be leaked to anyone else. But then it says:

Under the amendments made to Division 3 by the Bill, protected network information may be disclosed to, and used by, an ‘entrusted public official’ for the purposes of the Implementation Study—

which, by the way, the minister provides. He tells us, ‘This is really all that is happening so far and there is good reason for that. There has been no funding authorised for this $43 billion experiment. There is no appropriation.’ But it goes on to say—

… for the National Broadband Network, or for a purpose that is specified in the regulations.

I do not think the parliament has seen the regulations yet, so goodness knows what that means. But then there is another section referring to ‘Disclosure to, and use by, entrusted company officers.’ And we get similar advice. In other words, notwithstanding some promises of privacy, this information will be floating around all over the place and that is the purpose of the legislation. So far as I am concerned, I think it is an amazing abuse of the power of government. Yet, of course, it is the only way that this particular company can go into business.

The other thing that annoys me about this whole process is that, in the interests of competition, in the interests of letting the commercial or private sector manage a mature telecommunications industry, the coalition sold Telstra and I think mistakenly made a very large allocation of shares to the Future Fund. I am highly critical of the behaviour of Mr Murray, the entrusted chairman of the Future Fund, and his pursuit of the board of Telstra to force them to comply with the government’s wishes. I am not sure that did much for the share value. Having forced the share value down somewhat, I notice that the Future Fund has recently sold a large tranche of those shares. Of course their responsibility is to future superannuants from the Public Service. That is what the Future Fund is there for. I do not think any of this did any good for the value of that fund. That is an issue that might be raised on another day.

I have looked very closely at this proposal and I have had communication with people within and outside my electorate. A lot of hoo-ha was directed towards Tasmania, an area about which you, Mr Deputy Speaker Sidebottom, would be aware. A big publicity campaign was produced, and what have we discovered? We have discovered that somewhere around 15 or 16 per cent of Tasmanians want this new service. On its announcement, the AAPT chairman made a rule of thumb assessment that if every household in Australia signed up for this, and the business was run as a business, it would cost $200 a month to participate, at 100 per cent sign-up. So far the level of interest in Tasmania, an area where in many respects the service would be needed, is at 16 per cent. So not even a quarter of people think they will sign up.

So what is the revenue potential of this business? For most Australian households, the only advantage is being able to download movies a bit quicker. Yes, for the medical profession and others it is a case of the faster the better, and for certain business enterprises that is also the case. But I am quite sure that Telstra, Optus and the other suppliers in this region were quite cognisant of that and were developing programs to connect those particular interest groups to high-speed networks. They would have done that, and they would have made commercial decisions on whether traffic would pay for the capital expenditure involved. This proposal is clearly not going to be capable. The member for Canning complained, as I would, that many sectors of our electorates will be bypassed anyway, and in some instances getting a service to a very small community with fibre optic cable is just not practical. What is more, as time goes by, the wireless services are probably going to meet a lot of the demand throughout Australia anyway. It is technology that is expanding at a tremendously fast rate.

When a government commits to an ongoing program which it estimates at $43 billion, I think it is the responsibility of both sides of this House to ask whether that should be the highest priority for government investment in infrastructure. Of course this House has debated and will be called on to debate again the carbon emissions system. We are told by the Prime Minister and others that, if Australia does not address this problem, the end of the world will be nigh—the Barrier Reef will turn white, farming properties will close down, the Murray River will dry up. Why, then, is the government not seriously investing this sort of money in that sort of problem? We seem to have with the National Broadband Network more of a convenience than a necessity and, what is more, the private sector has been moving at a reasonable rate—though I would not say a satisfactory rate; I frequently have to correspond with Telstra and others about improved services, the coverage of black spots et cetera. That is a fact of life—it is not perfect. Maybe people feel that perfection will arise from this proposal. But is it worth $43 billion—and that could possibly be half price, if one is going to attract a 49 per cent partner—and should it have the highest priority?

Today’s Australian Financial Review carries the sad report of a renewable energy company going into receivership, not through bad management but through their inability to raise funds to build a project in which the federal government was going to put in $75 million and I think the Victorian government $50 million. The reality is that they could not raise the balance to go on with this project. More importantly, as the article proceeds we get to a very serious issue. I quote:

The Australian Geothermal Energy Association this week released modelling that concluded the early construction of transmission lines to geothermal plants in northern South Australia, at a cost of $171 million –

a bit different from a $43 billion –

would deliver benefits to electricity consumers on the eastern seaboard worth about $2.8 billion by 2030.

They went on to say:

Terry Kallis, managing director of listed geothermal company Petratherm, said the report demonstrated the need for regulatory changes to encourage the fast-tracked construction of transmission lines.

“This report shows early investment in transmission will allow low-cost geothermal energy to push electricity prices down along with the cost of renewable energy certificates [under the RET]—

the renewable energy target. Surely that is a priority. It is not uncommon for governments to invest in transmission lines.

And it goes much further than that. The world is embracing high-voltage DC transmission. The Chinese are presently building one of 2,000 kilometres at 6.2 gigawatts. I happen to know that that is double the installed electrical generating capacity of Western Australia—and you, Mr Deputy Speaker Sidebottom, might like to compare that with the full capacity of Tasmanian hydro. The line that now connects Tasmania and the mainland is a high-voltage DC line. It is used because energy losses in that technology are minimal, and that is the only reason that you can get electricity from one side of Bass Strait to the other. The Europeans are looking at putting a solar plant in the Sahara desert and transmitting the energy by high-voltage DC lines under the Mediterranean to Europe. There is other discussion—and, I might add, some controversy—that they are also proposing to fund the building of a big hydro project on the Congo river, for the same purpose. That is going to be a pretty fair trick. So that is available.

The other day, the Prime Minister gave his deputy an extra $1.7 billion to plug a hole in her BER—Building the Education Revolution. Had that money been invested in a power line of this nature, between the Pilbara and the Western Australian AC network, it could have saved hundreds of thousands of tonnes of emissions caused by pumping gas down the existing pipeline for the purpose of electricity generation in Perth—as compared to generating it where the gas comes ashore in the Pilbara and sending it down on electrical wires to that network. How does $1.7 billion compare with $43 billion? Is it a better investment? Were those lines then extended from the WA network to the eastern states network—and this type of technology already connects South Australia with Victoria, and Queensland with New South Wales—there would be massive opportunity to improve the efficiency of electrical transmission.

Of course, if you can get more electricity from one end of a set of wires to the other, you generate less at the feed-in end and you reduce emissions from the type of generating technology we use today. Three billion dollars or $4 billion—or say $5 billion or $10 billion, if you like—would create that network and it would open up huge opportunities for very reliable new technology in renewable energy that can compete with coal. In other words, you do not have to put financial burdens upon the coal generators. If you can connect it to the community through this technology you can save large amounts of electricity that are lost in present-day transmission. There is the real opportunity for government to invest money and, in my mind, it rates much more highly in priority than running around and starting a company to virtually compete with an established and mature commercial sector that is so far looking to be very reluctant to invest the other $40 billion, or whatever it is, and expect to make a profit. I think they know they cannot, and that is why, when they eventually made submissions, they failed.

Debate (on motion by Mr Byrne) adjourned.

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