Luke Hartsuyker (Cowper, National Party, Deputy Manager of Opposition Business in the House) Share this | Hansard source

I am pleased to be able to speak on the very important issue of the failure of the government to bring its spending under control. The member for North Sydney chronicled the waste of this government. He mentioned pink batts, Building the Education Revolution and sending cheques to dead people and pets. But the biggest waste of all is not a budget item. The biggest waste of all has to be the National Broadband Network—and it is not even on the budget, so Australian taxpayers will be unaware of the financial carnage that this government is wreaking in Australia. The National Broadband Network has a cone of silence around it. You cannot inquire into the actual position of the NBN; it is shrouded in secrecy. It started as a $4.7 billion fibre-to-the-node network across the country. But it has morphed. It has had the mother of all cost overruns. And now many industry commentators say they do not think it will be finished for $50 billion—a tenfold increase in cost.

We have had no cost-benefit analysis. The Minister for Broadband, Communications and the Digital Economy, Senator Conroy, worked out the details on the back of a beer coaster on a VIP jet with then Prime Minister Rudd flying from Sydney to Perth. The $4.7 billion project morphed into something much more expensive. The member for North Sydney chronicled a number of fairytales earlier. We had the Wizard of Oz and the Magic Faraway Tree. But there is a bigger fairytale, and that is the NBN Co. corporate plan. The NBN Co. corporate plan is one of Australia's great fairytales. But it does tell us a few things. It claims that the actual cost, the capex, to build the network will be $37.5 billion but it will cost around $44.1 billion to complete the total project.

When you look at their figures, NBN Co.'s capital expense will be $1.4 billion more than originally planned, operating expenses will be $3.2 billion more than originally planned and, at the same time, revenue will be $600 million less than originally planned. That is a $5.2 billion adverse budget outcome in only two years. If you can achieve that in around two years, what hope does the Australian taxpayer have for any protection from the waste of this organisation over the life of the project, which is going to go well beyond a decade? The reality is that the government have no idea how much this project is going to cost. At every turn, they conceal the true position of the National Broadband Network.

The corporate plan for the NBN Co. has changed so much over the last couple of years that any forecasts made within it should be seen as nothing more than politically motivated guesses. We can have very little faith in NBN Co., because they miss every target. They are the gold medallists in missing targets. They missed every target in the 2010-12 corporate plan. The original corporate plan said the indirect costs were supposed to be $800 million by 2013. That has been revised up to $1.5 billion. This spending was on advertising, staff, vehicles, fit-outs, beer fridges—all the essential things. But building activity, spending on the actual network, was $1.7 billion less than actually planned. So NBN Co. was busily fitting out its offices, buying a fleet of vehicles and all that sort of stuff but the rollout of the network was actually proceeding at a snail's pace.

By 2013 the NBN fibre rollout was supposed to have passed 1.26 million premises; the new corporate plan says only 341,000. By 2013 the NBN fibre was supposed to be connected to over half a million premises; the new corporate plan revised that figure down by a princely 89 per cent to just 54,000. Total customer numbers, including wireless and satellite, have been revised down by 84 per cent from 562,000 to just 92,000.

But there is some good news. In the recent past, we finally got to the point where NBN Co. have more customers than staff. That is certainly a substantial improvement. Finally they have got to the point where they have got more customers than staff. NBN Co. is purely a financial disaster. If you believe the corporate plan, NBN Co. will have spent around $6 billion by 2013 for a grand total of 92,000 customers hooked up to its network—by any measure a colossal failure.

Despite the government rhetoric, the taxpayer is really paying for this. It is an absolute furphy to try and claim that this is somehow a project that can be kept off budget; it is a cost that is going to be met by the taxpayer. This project has little chance of being commercially viable. They did not even include in their figurings the cost of interest. My colleague the member for Wentworth quite rightly pointed out that a cost of around $10 billion in interest has not been included in the project cost. No developer would exclude interest charges on the cost of a development. But NBN Co. do, and they do it because they are trying to create an illusion that this project is somehow viable. I think Australian taxpayers deserve to know the true cost of the NBN. They deserve to know what it is costing them. They deserve to have the shroud of secrecy raised so that there can be actual transparency. Just as the government cannot get its spending under control, NBN cannot get its spending under control. In the current financial year NBN Co. will spend $1.1 billion on operating expenses, $3.2 billion on capital expenses and will only connect 54,000 customers.

The issue of how NBN Co. will run the satellites is of great concern. They will spend in the order of $2 billion on the satellite program. The program to have high-speed services delivered via satellite will be welcomed by regional Australia. But the reality is that there is no need for the government to own satellites, operate satellites and own the ground stations. When you talk to people in the satellite industry they are aghast at the fact that the government would go into the satellite business when they could have set a performance specification and had the private sector deliver the product, with utmost reliability, at a fraction of the cost. The government obviously have not learned from the Aussat debacle, where they lost $700 million in the early nineties. Nowhere in the world is a government getting into providing communication services via satellite.

We have the Joint Committee on the National Broadband Network. It is supposed to be the eyes and ears of the parliament, supposed to be a watchdog that looks over the project. When we have Mike Quigley, the head of NBN Co., appear before the NBN joint committee, all we get are elusive answers. We never get answers to the questions that we want, we never get frank and concise answers; we always get an attempt to shroud what is actually happening in NBN Co. I asked a question about some remediation works needed for Bonnyrigg subdivision. I asked what the cost was and, as is always the case, the CEO of NBN Co. said that he did not know.

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