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

The Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2009 is one of the most disturbing pieces of legislation that have been introduced in this parliament in my 29 years here. I underline ‘disturbing’. It is the first time that I have seen a government deliberately bypass the Constitution by way of a device that denies an established and recognised business access to the means of doing its business. In this case, the government is virtually forcing Telstra to transfer its fixed line traffic to the government’s new business. It is backdoor nationalisation.

The major losers will be the 1.4 million shareholders around Australia who bought shares believing they could trust this parliament. They bought a product from the previous government, and they knew what it was. All of a sudden there is a change of government and the issue of sovereign risk arises again. When commercially can you trust the parliament to protect your interests? Maybe the parliament will protect shareholders’ interests if the minor parties in the Senate reject this nationalisation bill. They are stealing the value of the investment of 1.4 million shareholders.

There will be divisions in this House and a list will be available in Hansard of members of parliament who voted for this device. It will be interesting to know, as we publish it around Australia, how those 1.4 million shareholders will react. Telstra has the most diversified shareholding membership in Australia. They will all be very disappointed with those members of this parliament who do not offer them the adequate protection that they expect for their investment. That is the fundamental of the issue.

Of course, it gets a lot worse than that. I remember in my parliamentary history when Telecom, as we knew it, was a government monopoly. We would all hang around on budget night to find out how much everyone was going to pay for their phone calls. That was a government decision. You did not read ads in the paper saying, ‘Come buy my telecommunications product,’ or see Dodo fly in to tell you what his deal is. You did not get any of that; you waited for the arbitrary increase in the cost of doing business.

If you were a rural resident who wanted a phone on the wall and your farmhouse was up the road from the highway or where the main line went through, in the early 1980s you paid A$6,000 to get the wire put up the laneway. Nobody else was allowed to do it. Who is going to set the charges to run the fibre optics up that same laneway when the copper wire has been disconnected by Telstra under the instructions of this government for fear that it will otherwise lose access to the new dimension of telecommunications spectrum?

I think of the implications of a government wanting to deal with a business that has upset it. If that business is heavily reliant on water, you cut their water off—‘I’ll teach you a lesson. You will do as I tell you.’ Have I purchased your property? Have I exercised section 51(xxxi) of the Constitution, which enables this parliament to acquire property on just terms? No, I just cut your water off. When your business ceases, you either come to heel or hand it over to me or the government company I have established that wants it and does not want to pay for it. Of course, if it is not that, it might be electricity. Do you cut that off? This is a process by which the government renationalises Telstra, which has been sold to the Australian people and has a very significant body of competition.

The message of this legislation is: ‘You, the consumer, will be happy. You’ll get better prices.’ That is pretty interesting because it is not the consumers who feel they are so badly done by; it is the other operators in the market who do not think they are making enough profit competing with Telstra. That is where the whingers come from. Telstra does a few stupid things, like putting a $2 fee on people paying in cash. It enrages people and it was silly and it was stupid. The fact that Optus did it six months before is not a matter of dispute. Optus, for instance, does not do much in my electorate. It was a silly thing to do.

There are occasions when Telstra let the people down in giving them the service they are entitled to. But they are out there wherever anyone wants communications. And it is no longer the telephone on the wall I mentioned. I get complaints from time to time, and I am surprised how often they come by email. My recollection of being in this job was, after the first time I was elected, the town of Denmark in the southern area of my electorate—a little town—had 160 outstanding applications to connect an ordinary phone. That was the level of service that the government provided. And here we are saying, ‘Let’s go back to the future’, on the argument that there will be a competitive advantage to consumers. Not as far as the cost of the network is concerned. The government is going to run that and Treasury will tell you how much to charge for it.

There were some estimates made when this announcement was made about the cost to the consumer, and one of the managers of one of these competing industries—AAPT I think it was—got on the radio and said, ‘We’ve done a back-of-the-envelope calculation, and if every household in Australia takes a connection to this service at the estimated cost’—I repeat: ‘estimated cost’; no-one knows what it is going to cost—‘then in fact we estimate the monthly fee will be $200.’ That is if every household takes a connection. There has been a lot of hoo-ha in Tasmania, and so far about 16 per cent of people have said they might take it on. A big seminar, a big publicity stunt was organised. They had to cancel it; nobody wanted to come. So outside of running some blue wire down a conduit somewhere down in Tasmania, nothing has happened. I might add the town of Burnie got full cable connection from one of the sale packages of Telstra, I think. This was organised with Senator Harradine, who had a pretty simple view about Tasmania: if you did not look after it, he did not vote for you. That was a fact of life. But they got that, and that is working and it would be an interesting test case of just how many people have connected to that system. And that was for free.

It is interesting that when one turns to the explanatory memorandum, the opening paragraph says:

The Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2009 (the Bill) introduces a package of legislative reforms aimed at enhancing competitive outcomes in the Australian telecommunications industry …

The clerks who wrote the legislation were not game enough to say ‘which will deliver competitiveness’. They gave themselves a bit of wriggle room: ‘aimed at increasing competition’. Of course the second reading speech, which has been repeated by a number of speakers here today and others, makes much of this ‘vertical’ problem. Let me read the second paragraph:

The package has three primary parts: addressing Telstra’s vertical and horizontal integration; streamlining the access and anti-competitive conduct regimes; and strengthening consumer safeguard measures …

It all sounds pretty good and one after the other, including the minister in his second reading speech, made much of the benefits to the consumer. The minister said:

These reforms are not without cost.

I say ‘amen’ to that!

However, international precedents where governments have made reforms to the underlying market structure indicate that the benefits will outweigh the costs.

Well we are entitled to consult history in that regard. History is dominated by reforms of this nature introduced in the United States of America—an extremely big market. The state of California is the fifth biggest economy in the world, and it gives you some relative example of where Australia would stand in that listing. But they had the company—I think it was ATT or ATM. Anyway, it dominated—

See this speech in context