Anthony Albanese (Grayndler, Australian Labor Party, Leader of the House) Share this | Hansard source

Defending the interests of his electorate against regional Australia is an interesting position for the member for Wentworth. One thing the National Broadband Network is aimed at is overcoming the tyranny of distance, by providing access to people in regional Australia, who have been denied access by the failure of the previous government.

The government does not support these amendments. With regard to volume discounts, the Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Bill 2010 as drafted provides the default position that NBN must not discriminate in the terms and conditions on which it provides access. In order to provide opportunities for innovation and differentiation by service providers, the bill allows for different treatment by NBN Co. but only where it aids efficiency.

The ability to discriminate to reflect demonstrable efficiencies is well accepted in economics. It is already provided for under part XIC of the Competition and Consumer Act 2010. While stakeholders have been generally supportive of the principle of this kind of discrimination, there have been some concerns about the possibility that it will favour Telstra in particular, which it is feared could benefit from volume discounts. The bill, therefore, includes appropriate safeguards.

Under the bill, volume discounts would also have to satisfy the efficiency test and, as an added safeguard, NBN Co. will not be able to offer a volume discount unless it is in accordance with an undertaking that has been approved by the ACCC. Any differentiated deals must be published, so there will be full transparency and the ACCC and access seekers can take action if they consider that the rules have been breached.

The government’s view is that the discrimination permitted by the bill is good policy and that there are strong protections against preferential treatment based on volume that does not aid efficiency. This amendment is unnecessary and, in fact, goes well beyond the stated intention of banning volume discounting. In fact, it prevents NBN Co. from offering any sort of differentiated terms to aid efficiency. Further, this amendment would reduce the opportunities for service differentiation and innovation that increases productivity and efficiency, which is why the government will not be supporting it.

I now address amendment (2) that has been moved by the member for Wentworth. The government also does not support this amendment. Under the proposed rules, new, upgraded or significantly extended fixed line access networks offering speeds in excess of 25 megabits per second and servicing residential and small business customers will need to offer a wholesale layer 2 service on an open access basis. The provisions do not prevent firms entering the market; they simply require them to comply with supply and access requirements comparable to those applying to NBN Co. when they do. The provisions do not require competitors to match NBN Co.’s actual terms and conditions; they simply subject them to comparable layer 2 open access requirements.

The object of these requirements is to ensure that end users have access to the same kinds of service outcomes available on the NBN regardless of the network provider. Moreover, the rules will mean NBN Co. is not hindered in delivering its objectives, particularly uniform national wholesale pricing, by strict regulatory requirements while competing against other less regulated providers of superfast broadband.

NBN Co. indicated in its corporate plan that it intends to implement the government’s uniform national wholesale pricing objective through subsidising high-cost, low-revenue regions with revenue raised from low-cost, high-revenue regions. It is not fair to simply allow competitors to opportunistically target lucrative markets while leaving the challenging high-cost, low-revenue ones to NBN Co. The requirement is forward looking and will have minimal impact on existing providers and their operations. Exemption and transitional mechanisms have also been included in the bill to provide sensible flexibility.

The opposition’s amendment has the potential to leave some communities’ service outcomes below those available on the NBN and to undermine the government’s policy that NBN Co. deliver uniform national wholesale prices. The government does not support this amendment and the government believes that this amendment is contrary to the objectives of the National Broadband Network and contrary to the government’s view that equitable delivery of NBN is vital for Australia and vital particularly for those who live in regional Australia. (Time expired)

See this speech in context