James Stevens (Sturt, Liberal Party) Share this | Hansard source

I rise to support the second reading of the Telstra Corporation and Other Legislation Amendment Bill 2021, which has two fundamental components to it in response to decisions that Telstra have made to change the structure of the company to ensure the obligations that are currently on the company remain in place for any subsidiaries that they might establish—in fact, which they've indicated they plan to establish—so it's important that we pass this legislation. I note that it seems to have strong support from all members of the House, and hopefully it will equally do so in the Senate.

Telstra, of course, started way back as the old Postmaster-General's Department, when we had the telegraph system. That's why when you walk around the streets of Adelaide you often see manholes—or personholes I think we call them these days—that say 'PMG', which stood for Postmaster-General way back when. When I was a boy, we called Telstra Telecom. They changed their name to Telstra and have been a listed company for the last 20 or so years. When they were privatised, it was important that legislation was put in place to preserve two fundamental responsibilities for which Telstra have an enduring responsibility. They are a universal service obligation, and competition and access for other providers to Telstra's infrastructure. That was one of the fundamental components of that business when it was privatised. Back then it was the copper wire network. Now, of course, telecommunication infrastructure and assets are much more substantial. These are two important areas, and we wouldn't like to see in either case those obligations not to continue to be met by subsidiaries or spinoffs that Telstra might establish, and that's what we're doing here.

As a Liberal and a free market capitalist, I've got a very significant concern about monopolies. As much as possible we don't want to see monopolies operating in markets, but sometimes, unfortunately, they are necessary, and that's why they need specific and bespoke regulation. This is the case for other utilities. It would be ludicrous to suggest we have two different sets of water pipes or two different sets of transmission lines running down the same street so that we could have competition in the water market or in the electricity transmission market. These, of course, are monopolies. Sometimes they are held by governments. Sometimes they've been privatised. In most jurisdictions I'm aware of even when they're held in government hands they've been corporatised.

In South Australia, SA Water is a good example. They are still very much a state government owned entity but they operate like a business. The way in which they charge for water is set through a market mechanism. The Essential Services Commission of South Australia makes determinations on what the costs are to run a water business and what the value of the balance sheet is—ostensibly, the water network. All those things are put together, and a fair rate of return is put determined on the value of the assets. That goes into the sausage machine and comes out as a pricing indication. That's largely the same with electricity transmission as well. There's only one transmission option to get your electrons from a power station to the socket in your wall at home. You can't change providers. There's only the one business that has those poles and wires, so what they earn for that transmission is also regulated.

In the case of Telstra, it's a little bit more complex. Telstra, of course, are a retailer. They also have significant assets, some of which they compete freely in the market with. Mobile phone towers are a good example. Certainly in my electorate, Optus and other providers as well as Telstra have their mobile phone coverage that they pay to put in place, and they compete. Telstra complete with other providers. But there are some parts of Telstra's assets for which there is no competition, for which they are in fact the only holder of particular infrastructure. That's why it's important that we have competition measures in place—so that Telstra can't abuse that monopoly and that particular infrastructure by either charging exorbitant rates to their competitors for access to their infrastructure or, potentially, denying their competitors access at all. That, of course, is a very important fundamental of competition policy in this country, whether we're talking about telecommunications infrastructure, electricity transmission, water pipes or whatever it might be. Where there is a government owned business, privately owned business or a public company, as Telstra is, it's very important that we put in place measures so that they can't abuse that market monopoly where we accept that a monopoly has to be in place because of the ludicrous cost to duplicate infrastructure so unnecessarily.

That, I suppose, segues into the universal service obligation. It's critically important with essential services, whether they be telecommunications or similar examples I've been referencing—electricity, water, gas et cetera—that every Australian has equal access. Telecommunications is one of those. The universal service obligation is in place in a lot of other services. The postal system is probably another good example. The postal network has to operate evenly and equally right across the country. Regardless of where you might live, everyone's got access to a local post office and there's no difference in the cost of sending a letter to your neighbour or to someone on the other side of the country.

With telecommunications, it's equally the right of all Australians to have access to the telecommunications network and for that to be provided by Telstra under their universal service obligation. As we know with other infrastructure, at times they'll have a higher cost for particular types of properties, whether that be because of their remoteness or what have you. But that particular person living in that home can't be penalised particularly; it's spread amongst the costs Telstra have and get a return on through their charges in providing the total network across the nation.

Those two things are fundamental. Regardless of your view and without getting into debates about Telstra's privatisation, as the amendment seeks to do in the second reading, it's very important that the fundamental principles and protections that were put in place when the Howard government privatised Telstra are maintained in any circumstance. It did slightly surprise me that this was at risk. I assumed that, no matter what, it wasn't possible for Telstra to escape the requirements that they have through legislation as part of their privatisation to provide that universal service obligation and, equally, to make sure that they're providing access to their competitors to certain parts of their infrastructure that they have a monopoly over. Evidently, it is important that we pass this legislation to ensure that there is no uncertainty, when Telstra pursue the plans that they have to change their corporate structure to split, that whatever entities are spun off or spun out of the current Telstra do not, through that process, escape the obligation that was put in place. That's a very important principle.

In privatising Telstra, no-one would ever have envisaged or suggested that they would not have an enduring responsibility to do those things; quite the reverse. It's very important that, although we have a public company that is a substantial player in our telecommunications sector industry—as I've said, in some areas they do that in a very competitive market, and it's good that we have competitors to Telstra in certain segments of the market. The market, when working well, hopefully leads to consumers getting the best possible deal and value from the services that they're accessing because they have choice and can choose between a mobile phone package from Telstra, Optus, Vodafone or whoever it might happen to be. There have been other players in the market in the past and there may well be more coming into the market in the future. We encourage that. We encourage any increase in competition.

Something like telecommunications services, and mobile phone services, is an area that is only going to grow enormously in size. We're seeing already a rapid transformation in just a two-year period, where something like a pandemic comes along and people have an enormous increase in their reliance on certain telecommunications services—and that, equally, is going to see more money spent in the sector for more and expanded services. That's why we absolutely want to see increasing competition as that market increases in size and value but also in the types of things we can do through the telecommunications network. As we enter the era or the internet of things and the concept that nothing in our lives is likely to be disconnected or off the grid, from a telecommunications point of view, it's never been more important to reflect on how critical it is that we get competition policy right and that we make the right decisions in this place about the future of an industry that, in many ways, will be the most significant of all of them in the years ahead.

This legislation ensures that we continue to keep that faith and commitment that we made when Telstra was privatised to ensure that the community service obligation is preserved in any future ownership structure of Telstra, and to ensure that the competition and sharing of the monopoly and legacy infrastructure they have in place continues into the future. We want to see a thriving sector. I'm proud of Telstra as a company. I suppose I should draw the House's attention to the fact that on my Register of Members Interests you will find a very minor shareholding in Telstra, which I of course have appropriately declared. Nonetheless, I think it is very important that a great company like Telstra, through this legislation amending existing acts that govern it, is still held to account against the fundamental principles put in place when it was privatised. With those words, I commend the bill to the House.

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