David Hawker (Speaker) Share this | Link to this | Hansard source

I have received a letter from the honourable member for Melbourne proposing that a definite matter of public importance be submitted to the House for discussion, namely:

The Government’s incompetent handling of the privatisation of Telstra.

I call upon those members who approve of the proposed discussion to rise in their places.

More than the number of members required by the standing orders having risen in their places—

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Most of us in politics spend a lot of time and energy seeking win-win situations. Sadly, all too often we are not successful in that and occasionally we manage win-lose situations and, unfortunately, every now and then we end up with lose-lose situations. You may recall that the Leader of the Opposition described the outcome of the government’s latest Telstra privatisation plan as a lose-lose situation.

As can sometimes be the case, the Leader of the Opposition was being a little bit generous in describing the government’s handling of the Telstra privatisation as lose-lose because in fact it is lose-lose-lose-lose. The Howard government is on the verge of a unique political achievement—a four-loss register: lose-lose-lose-lose. The source of this achievement, of course, is John Howard’s you-beaut Telstra share sale scheme with the aid of his own person salesman, Slick Nick, the man with the gold-plated cufflinks, the designer glasses, the shiny patent leather shoes and those beautiful clipped consonants and rounded vowels. Have you ever noticed them? Probably you do not know him; I am not sure whether you know him well. But he is a guy who has all the attributes required for the job: the gold-plated cufflinks and the rounded vowels.

In John Howard’s you-beaut Telstra sale, everyone is a loser. This is a unique political achievement—four losses: everyone is a loser. Let us start with the hundreds of thousands of existing Telstra shareholders, many of whom purchased their Telstra shares for $7.40 in T2, some of them who even purchased Telstra shares at a higher price subsequently. How are they faring? They are already losing because the government’s plans are already putting substantial downward pressure on the share price and have been doing so for several months. The institutions, the institutional investors, are not silly. They could see this coming. They have been selling their Telstra shareholdings for months because they plan to buy back in, later down the track, to T3 at a lower price. Already Telstra shareholders are suffering a depressed price as a result of John Howard selling Telstra shares at a highly inappropriate time into an already depressed market.

Slick Nick says Telstra shares are doing fine. In the Senate yesterday he said, ‘Don’t worry. There’s no problem because, if they haven’t sold those shares, they haven’t made a loss. If you bought a share at $7.40 six or seven years ago and you have not sold it, and it is now only worth $3.50, it does not matter—you are not out of pocket. You have not made a loss. Everything is fine.’

Mr Deputy Speaker Causley, I am sure you would be aware that Terry McCrann is not a Labor acolyte. Terry McCrann is not renowned for pulling his punches where Labor is concerned. He is one of Australia’s premier business commentators, if not the premier business commentator. I draw to your attention some of his observations about Slick Nick in this morning’s Telegraph and Herald Sun—

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

Mr Deputy Speaker, I take a point of order.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

He is not a member of the House.

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

I request that the honourable member address senators by their correct title.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The standing orders do require the member to address members of parliament by their title or by their seat.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

No class at all. Senator Minchin is referred to by Terry McCrann in his article as ‘idiotic’. McCrann describes Senator Minchin’s statement as ‘words of astonishing stupidity’. He says:

Minchin ... “announced” he was not competent to be finance minister ... the nation’s finances should not be entrusted to his care.

They are pretty damning words from the nation’s, if not premier business commentator—and certainly no friend of Labor—then one of its premier business commentators. The government is tricking up the Telstra sale to paper over the huge downward pressure it is putting on the share price and the huge negative impact that is having on existing shareholders. Firstly, they are giving people access to the full dividend for the share in this financial year, even though the people who purchase shares in T3 will only have to pay for part of the share. They will not have to pay for the other part until, perhaps, 18 months later—John Howard’s buy now, pay later scheme, straight out of Harvey Norman. Secondly, the government has forced Telstra, only weeks after Telstra had said they did not want to do this, to commit to paying a 28c dividend in the next year. That requires Telstra to borrow further to cover that dividend, an outcome which is unsustainable—Terry McCrann has said it is unsustainable, Standard and Poor’s has said it is unsustainable and Moody’s has said it is unsustainable. The government has also muzzled the Telstra board and management in an agreement which is designed to stop them from speaking out in the debate about regulatory issues.

Finally, we are waiting for the details of the preferential arrangements the government are going to offer existing Telstra shareholders. In spite of all the gimmicks and the tricks the government still will not reiterate its claim in 1999 that ‘Telstra shares are an extremely good deal’. Remember John Howard in 1999 telling prospective investors, ‘These shares are an extremely good deal—you should sign up now’? Nothing like that is happening now. The government’s alibi for not doing that now is that legislation has changed and they cannot present themselves as financial advisors. That is a very thin fig leaf indeed. The reality is the government know they would be laughed at by investors, particularly those who have lost a lot of money on T2.

What is keeping the share price relatively stable at the moment is the fact that the details for T3 have not been finalised. The shares are obviously not yet on the market. The real negative impact is not going to be felt for a couple of years because the artificial dividend arrangement that the government has entered into will prevail for a while. But once that dividend arrangement is finished, the negative impact on the shares will manifest. If the government wins the next election, once the Future Fund is free to sell down its holdings that will also have a big impact on the share price. For the last time I will quote Terry McCrann—to illustrate what is really happening with this share offering and its true impact on the existing shareholders:

... the Government is quite deliberately setting out to artificially entice you to invest. It is doing so by giving you an unsustainable supercharged dividend income.

That says it all. So the first losers are the existing Telstra shareholders. What about taxpayers? What about the people who ultimately own the asset and who are seeing that asset sold? How are they faring out of T3? The government is selling its shares in a falling market and contributing to the decline in that market. It is giving away free dividends. So while it is still part-owning shares, it is giving away the dividends, at the cost of several hundred million dollars to the budget. It is preparing other sweeteners which are yet to be announced. In the middle of huge regulatory uncertainty and debate about the stalling of high-speed broadband in this country and the absence of any strategy on the part of the government to address this, the end result is a substantially lower return to taxpayers for the sale than otherwise would have been the case. Is this a good time for a vendor? Is this a good time for owners of large numbers of Telstra shares to be selling to the market? I don’t think so.

The government suggest that it is Labor’s fault that the value of Telstra’s shares has gone down, and that it is Labor’s fault that the government were not able to sell the shares earlier—in other words, Labor has prevented them from ripping off Australian investors to the tune of billions and billions of dollars that the government otherwise would have taken out of their pockets had they been able to sell all the Telstra shares at $7.40. It is Labor’s fault for preventing that. All of the incompetence, all of the mismanagement of Telstra since that time—whether it was for allowing line rental fees to go up to $30 a month and pushing more people over to mobile phones or whether it was for wasting billions of dollars in losses in Asian investments—is somehow our fault. Somehow the mismanagement of Telstra under the auspices of the government is Labor’s fault; in other words, Labor is responsible for the government’s incompetence.

There are two losers so far: shareholders and taxpayers. But what about consumers? What about the people who ultimately matter most—the 20-odd million Australians, businesses, families and individuals who rely on Telstra, still nearly two-thirds of the entire telecommunications sector, to get high-quality, high-class telecommunications services? What about consumers? First, they are going to lose on accountability.

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

Mr Hockey interjecting

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

Order! Minister!

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Will the government still have Telstra fronting up to Senate estimates to be questioned about their policies and activities?

Anthony Albanese (Grayndler, Australian Labor Party, Deputy Manager of Opposition Business in the House) Share this | Link to this | Hansard source

Mr Albanese interjecting

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

Order! The member for Grayndler should remember he is also on a warning.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Will Telstra still be susceptible to FOI? No. What we will have is de facto public ownership through the Future Fund but without the public accountability that used to prevail. Broadband is still on the never-never; the government has no strategy to tackle the No. 1 infrastructure issue in this country. Way more important than the question of who owns Telstra shares is how Australia is going to get amongst the world-leading countries such as Canada, the United States and Korea and the countries of Western Europe and have high-speed, high-class broadband services that are the basis for future economic activities in this country.

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

Mr Hockey interjecting

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

Order! The minister will be removed if he is not careful.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Finally, how will consumers go when a privately owned Telstra exercises its huge financial muscle and buys up half the Australian media? How will consumers fare when a giant, privately owned company controls two-thirds of telecommunications and half of Australia’s media—electronic and print? The repeal of the cross-media ownership laws the government has announced and the privatisation of Telstra mean that that possibility is now sitting there, waiting for a private Telstra to be put in place.

Joel Fitzgibbon (Hunter, Australian Labor Party, Shadow Assistant Treasurer and Revenue) Share this | Link to this | Hansard source

Mr Fitzgibbon interjecting

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Hunter has been warned too.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

The third losers are consumers. Any way you look at it, they will be losers. What is happening to Telstra workers? The superannuation entitlements for Telstra workers—for existing employees, not new starters—are being sent backwards because they are being forced out of the Commonwealth Superannuation Scheme—a defined benefits scheme that Telstra puts 21 per cent on average into on their behalf. Those employees will be forced out of that scheme into a scheme where 12 per cent will be contributed. They take a risk because it will be an accumulation scheme. Over time, they will be substantially worse off than they would otherwise have been had they remained in that existing scheme.

Why are the government doing this? What is their argument? What is their reason? The primary argument they put forward is the alleged conflict of interest between owning shares in Telstra and regulating telecommunications. They also own Australia Post and regulate postal services. That does not mean that they will therefore privatise Australia Post—although if they get re-elected perhaps that will be on the agenda.

I had a look at the Future Fund legislation the other day, and there is a very interesting set of provisions that have not had much coverage so far, in section 6 and section 8. Section 6 enables the government to transfer shares and financial assets into the Future Fund. Fair enough. Section 8 says that the nominated minister may give the board of the Future Fund written directions about the financial assets. Those directions can relate to how long they hold those assets, how they vote, the rights that are associated with those shares in the company and any other matter. Most significantly, they are not bound by the requirement that otherwise applies to the Future Fund to put the maximisation of returns ahead of all other objectives. So, in other words, within only months, the government has placed provisions in the Future Fund legislation that are specifically designed for Telstra to still be effectively controlled by the government through the power of ministers to give directions to the Future Fund on how they will utilise those Telstra shares.

Where does this leave the claim that the government are removing an iterative conflict of interest? Where is the evidence that that conflict of interest has been taken away? The government still owns the shares, it still needs the dividends, it is still relying on share price and it has specifically put provisions in the legislation regarding the Future Fund to enable it to exercise a degree of control over those shares that will not apply in any other case with respect to the Future Fund. If, as the government say, they have no intention of being anything other than a passive investor, why did they put these provisions into the Future Fund Act? What other conceivable situation could those provisions relate to?

They must have very short arms indeed if this is an ‘arm’s-length arrangement’. There is an alternative. The alternative for this country is to focus on the real problems in telecommunications—the disgraceful performance in broadband that is holding Australia back economically—to retain public ownership of Telstra and to use it in the interests of the nation; to develop high-class infrastructure instead of the dilapidated and declining infrastructure we currently have; and to give Telstra shareholders the certainty and stability that their investment is worth while into the future. Instead of the fiasco the government has created with T3, let us get onto moving to build the arteries of the future economy of the 21st century. (Time expired)

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

The Labor Party have two fundamental problems when they criticise and attack the government for its privatisation proposal for Telstra. The first is that the government has gone to the last four elections committed to selling Telstra. We have faced the voters of Australia openly, transparently and totally accountably in regard to our policy of privatisation. Each time we have been returned. This is not electorally popular. There is nobody on my side of politics who believes that privatisation policies at large, and Telstra in particular, are a net vote winner amongst all Australian voters. Of course there is a strong constituency for economic reform of this kind that believes it is in the nation’s best interest. I do not believe it is a vote loser for the government, but it does mean we have to stand our ground—to argue it. I have stood in some drafty halls in outback Australia justifying and explaining the government’s decisions.

You do win people over when you go through it sequentially and weigh up the benefits against what might be philosophical or ideological concerns and objections; people will agree to the selling of Telstra. The point is that you have to get to a lot of people more directly than is physically possible. So the government believe that we have a right to put these matters before the Australian people, as we have done at election times. There is no ducking and weaving to avoid the issue, which is a trait of the character of the modern Labor Party. It fails to take a stand. It lacks intestinal fortitude. It is lazy. It will not do the hard work. What we have heard from the shadow minister for communications, who is amongst the brightest thinkers in the opposition, is just a jumbled, garbled attack on the government.

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Mr Deputy Speaker, I rise on a point of order. I request that the minister refer to me by my correct title, which is shadow minister for finance.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The Minister for Agriculture, Fisheries and Forestry will ignore that point of order.

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

I stand suitably admonished, but he was shadow minister for communications for a very long time. I had not noticed that he had switched portfolios, such is his lack of impact on the government. In any event, whilst he is credited as one of the opposition’s best thinkers, he is not one of their best doers. They are very short on thinkers, but they are even shorter on doers and achievers. That is the problem with the Labor Party, so it is very hard to take them seriously. We do, of course, because we do not regard government as an entitlement or an inheritance. So we do tend to take the Labor Party seriously, or at least more seriously than the general public does.

The second problem that the Labor Party have is that they were rabid privatisers when they were in government. The Australian people do not believe for a moment that the Labor Party would not privatise Telstra or any other government business that they could possibly get their hands on if they were in government. Indeed, some pollsters have said that, despite the government’s wearing the political pain and cost of arguing for the privatisation of Telstra before each of the last four elections, there were no surprises afterwards that it has not been a vote switcher. According to the pollsters, people believe overwhelmingly that the Labor Party would do the same in government. And why wouldn’t they? They are now led by a former minister for finance himself. The now Leader of the Opposition addressed the Commonwealth seminar on the future direction for the Commonwealth public sector on 14 July 1994. How is this for chest beating and boasting! He said inter alia:

The government today—

the Labor government—

has completed a number of sales, including the Tokyo embassy land, the Defence Service Home Loans Scheme, the Moomba Sydney pipeline system, a large share of the Commonwealth Bank and CSL. Total net proceeds are up to about $5 billion. Sales of Qantas, ANL, AIDC Ltd amongst others are being planned.

We now know that the Labor Party went through with most of those privatisations. There he is, parading his credentials as a privatiser of note and of historical proportions. Soon afterwards, on 1 February 1995, he actually criticised a previous Liberal government for not privatising enough. Why don’t we let the Leader of the Opposition’s words speak for themselves? He said:

We as a government have a considerable rate of success in relation to privatisation.

…            …            …

We have two airlines undergoing privatisation. One is completed and the other is going through. We are getting the airports in place.

You did not; we had to get the airports in place. But let me continue. The now Leader of the Opposition also said:

We have privatised nearly 50 per cent of the Commonwealth Bank.

They went on to privatise 100 per cent soon after.

We have privatised the Commonwealth Serum Laboratories and the bulk of defence industries. When you were in office—

referring to the Liberal Party—

there was one effort and that was with the Belconnen Mall. The total number of privatisation projects under the Fraser-Howard government amounted to the Belconnen Mall, and you did not succeed in delivery on that.

Here he is in the parliament on 1 February 1995, abusing the Liberal-National coalition for not privatising enough. He is accusing the Fraser-Howard government between 1975 and 1983 of being spectacular failures on privatisation. Now, really, does a leopard change its spots?

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

No.

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

Or does an old dog learn new tricks?

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

No.

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

Let me resort to more cliches. On the one hand—

Lindsay Tanner (Melbourne, Australian Labor Party, Shadow Minister for Finance) Share this | Link to this | Hansard source

Mr Speaker, I rise on a point of order. I would ask you to draw the minister back to the question, which is T3 and the government’s incompetent handling of it and not a history lesson about stuff that has nothing to do with Telstra.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Melbourne would be well aware that a matter of public importance is a wide-ranging debate. The minister is in order.

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

This is a debate about the privatisation of government business, and I feel that we should establish our credentials. The government’s credentials are on full show, having been consistent and considered over a long period of time, and the opposition have been hiding their credentials on privatisation. I just want to remind them that their leader has been up to his neck in the privatisation of Commonwealth government businesses over the years. He was proud of it and was actually abusive of previous coalition governments that did not reach his lofty standard and record number of privatisations. Forgive me if I have embarrassed the opposition by quoting the words of their now leader.

The Labor Party therefore comes to this debate without conviction or credibility. We believe that the government has had a massive conflict of interest as both the industry regulator and the owner of Australia’s largest telecommunications company. There is no getting away from that. Of course, so much of the debate and public controversy which has been generated in recent months by the current management of Telstra—it is in conflict with the regulator, the Australian Competition and Consumer Commission—highlights the fact that the government, on the one hand as a majority owner of a telecommunications giant which is in a not too private nor too polite conflict with the regulator, cannot go on. It is unfair to Telstra’s competitors; it is unfair to the company; it is unfair to the shareholders; and it is most certainly unfair to consumers. It lacks certainty and transparency.

The simple fact is that governments should not be in the business of running businesses; businesses should be running businesses. The government’s role is to regulate appropriate consumer protections and to encourage a competitive marketplace, which we have done. Remember: the government does not have to own Telstra in order to regulate it. The government regulates all participants in the telecommunications industry, and this would continue regardless of the ownership structure of Telstra. The safeguards include, by way of regulation, the universal service obligation, the customer service guarantee, price controls and other important consumer protections. As a result, our strong regulatory regime has ensured fairer prices; untimed local calls; minimum service standards; mandated repair times; reasonable, improved mobile phone coverage; encouragement of competition; and an increasing rollout of broadband across Australia. These consumer protections remain in place as the government moves forward on the sale of Telstra.

At the same time, the government is investing an additional $3.1 billion in telecommunications through the Connect Australia package and the $2 billion Communications Fund. These investments will help roll out affordable broadband across Australia, improve mobile coverage, roll out high-capacity networks for health and education initiatives and provide affordable telecommunications services to many more remote Indigenous communities.

So the government has a strong record of achievement in telecommunications. We do not believe the job is anywhere near done. There is a great deal more to be achieved. We have a heavy responsibility to provide an equivalence of service between non-metropolitan consumers and communities and to bridge the telecommunications gap between urban and rural Australia, and we will live up to that responsibility. All of these commitments, policies and safeguards of the government, proven over our time in office, will continue to apply to Telstra and all carriers, regardless of ownership, because they are all provided for in regulation.

There have been enormous benefits from the government’s oversight and stewardship of Telstra in our 10 years in office. As we have moved towards the full privatisation of Telstra, the reliability and availability of telephone services have improved while the cost of services has reduced. Let us look at some of the facts and figures, so that even the Labor Party—

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

Mr Gibbons interjecting

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Bendigo will have an opportunity if he remains quiet.

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

cannot contest or argue against them. And the Labor Party might very well—if they were to be objective, fair and balanced about this—give the government credit. Since 1997, the average price of telecommunications services has fallen by more than a quarter, by some 26.2 per cent. It has fallen by a quarter. For instance, a three-minute call to China in 1997 would have cost $7; the same call today can be made for as little as 56c. On average, households are $717 better off than they would have been without the government’s competition and privatisation policy, and the economy is some $12½ billion dollars larger today than it would have been. So the Labor Party may want to take those facts on notice, give them a considered examination and reply—and give credit where credit is due. There is no doubt at all that consumers believe that the government’s policies, which include privatisation, have been of material and calculable benefit to them.

Governments all around the world, of all political persuasions, from the Left to the Right of the political spectrum, recognise that there is little point in owning telecommunication carriers. There is a whole list of countries in Europe—Germany, France, Italy, Norway, Portugal, Denmark; the list goes on—or our near neighbours such as New Zealand, Japan, Korea and Taiwan. The governments in all of these countries are getting out of telecommunications ownership. Even the Chinese Communist Party is selling its shares in China Telecom.

So it would seem that the Labor Party are the last of the planned economists and that they believe that the government should still be the majority or whole owner of telecommunication carriers such as Telstra. It just lacks credibility in the constituency. I believe the Labor Party are underestimating the judgement and, may I say, the economic nous of the Australian electorate. The Australian electorate have moved on a great deal since 1997, when we began the part privatisation, and they have experienced the benefits of the government’s policies. I believe they are broadly supportive—and, I even confidently predict, by a majority—of the government’s full privatisation, because they know that privatisations are a vital part of liberalising and strengthening an economy.

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

Why didn’t you sell the lot of it then?

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The member for New England!

Peter McGauran (Gippsland, National Party, Deputy Leader of the House) Share this | Link to this | Hansard source

The government, after closely studying Telstra and the share market for the past 18 months, believes its offer in the order of $8 billion in shares will result in a fair price for those shares. Our public commitment has always been that we would not sell Telstra until we could receive an appropriate return for taxpayers. We believe we can get a fair price at this time in this way.

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

Mr Windsor interjecting

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

The member for New England is warned!

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

Let there be no doubt that the political interests of the Howard government are dictating the agenda on the Telstra sale decision based on the short-term political gain for the government rather than the national interests of Australia. The Howard government’s T3 sale is already putting downward pressure on share prices, as institutions have sold existing shares to enable them to buy in at cheaper rates in the T3 offer. The government has loaded the sale with the sweetener of a full dividend even when you have only paid for part of the share. But, once that runs out and the Future Fund is allowed to sell its shares, the pressures on share prices will be enormous.

The timing of the sale could not be worse, even under the Howard government’s poor record: fibre rollout stalled and regulatory conflict went unresolved—in fact, Telstra’s Phil Burgess had the audacity to tell a meeting in Bendigo recently that the Australian telecommunications regulations are holding back the country’s economic progress. Telstra’s current American-styled national leadership have to understand that the American way of running big corporations is just not applicable to our culture. The regulations in place are there in Australia’s national interest on behalf of Australian consumers, something that Mr Trujillo and Mr Burgess do not and will not understand. And, of course, adding to the appalling timing of the T3 sale, we have the share price falling.

The Howard government would have us believe that a conflict of interest exists under the current arrangements. What absolute rubbish. The government still owns and regulates the ABC and Australia Post. It will still own one-third of Telstra, so there will still be an alleged conflict; and the Future Fund legislation, specifically sections 6 and 8, allows it to direct the fund regarding its Telstra shareholding, including to act non-commercially.

The government would also have us believe that it is Labor’s fault that we are in this situation. If all of Telstra had been sold at $7.40 in 1999, as per the Howard government’s preferred position, shareholders would have been in a far worse situation. The government cannot blame Labor for its incompetence in allowing Telstra to lose billions in Asia, chase Fairfax and Channel 9, and jack up line rentals to $30.00. This is a politically driven fire sale that hurts shareholders, taxpayers, consumers and Telstra staff. It is a shambles and it is being done to suit the Prime Minister’s political interests.

Whilst Telstra appears to be concentrating its efforts in the capital cities, it has failed to adequately provide broadband services across all metropolitan areas. Even with existing facilities attempting to provide reliable, efficient and cost-effective services from regional areas, there is an increasing push to centralise and so remove the benefits of regional employment from the bush. The move to full private ownership would effectively stop any future government with genuine concerns for the bush having any say in how services are delivered. ‘Commercial viability’ will always be available to protect all telecommunications companies from their responsibility to the Australian people.

Labor is committed to maintaining a strong influence on telecommunications to ensure the needs of country people are met and to keep Telstra connected to regional Australia’s future. Most regional Australians slammed the proposed $3.1 billion Telstra deal announced in September 2005, designed to sweeten the Nationals to guarantee the telco is fully privatised.

The decision to press on with the sale through this bill represented a ‘dirty deal done dirt cheap’, and the National Party stands condemned for agreeing to it. In fact, I stand in awe of National Party ministers especially, and backbenchers, when they defend the full sale of Telstra. It is a courageous act for them because I know just how unpopular the sale of Telstra is in their own electorates. As I have said before, the Nationals continue to remind me of a flock of frightened and bewildered sheep being kept in a small and tight bunch by the Liberal dogs running around them, barking and snapping at their heels. Every now and then, one of these frightened and bewildered sheep gets spooked and hares off in the other direction—this sheep’s name is ‘Barnaby’—only to be run down and turned around by the Liberal Party dogs, usually ‘Heffo’, the blue-blooded heeler, and of course always followed by ‘Cossie’ the cowardly cocker spaniel, who aspires to lead the pack but is always let down by his inaudible bark and the fact that he has no teeth, hence his timid and almost non-existent bite.

The Nationals have never been anything but sheep in wolves’ clothing. When they are in their electorates they growl like wolves as though they are going to bare their fangs and rip into anyone who laid a hand on the country. Then, from 1996 they signed up as the country branch of the Howard Liberal government, dropping the pretence of being wolves and now they just bleat like sheep. The Howard government has stated repeatedly that it would not sell its remaining shares in Telstra until services in rural and regional Australia were up to scratch.

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

On a point of order, Mr Deputy Speaker: I have been very patient, but the member for Bendigo is making a number of offensive remarks about colleagues and not addressing them by their proper names.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

Minister, the references are very broad and, while you may not like them, I think the member is in order.

Steve Gibbons (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

Mr Deputy Speaker, I was referring to sheep, not whales! The Howard government has stated repeatedly that it would not sell its remaining shares in Telstra until services in rural and regional Australia were up to scratch. Anybody who lives in or visits rural and regional Australia will tell you that Telstra services are nowhere near adequate and in some areas are getting worse. To add insult to the people of the bush, the Howard-Costello government have not only reneged on their commitment not to proceed with a sale until services are up to scratch but also announced the $3 billion dollar taxpayer funded bribe to get Telstra to do what it is already supposed to do under its charter. The Howard government has thrown in the towel in directing Telstra to lift its game and is using taxpayer funds to attempt to improve the very services that Telstra should already be providing.

The only way that services for rural and regional Australia can be improved is for Telstra to remain in public ownership and for the Howard government to direct the telco to carry out its charter and deliver the services it is supposed to provide. Most Australians do not want Telstra privatised. Telstra returned profits of around $3.2 billion this financial year, so what is the rationale behind the sale? Obviously sheer ideological obsession by the Howard government has driven this ridiculous policy, and rural and regional Australians will suffer the consequences.

The Howard government should direct Telstra to honour its charter and provide the same opportunities for services in rural and regional Australia as in the capital cities. Selling Telstra will only worsen services in remote areas because a fully privatised Telstra will concentrate its resources in the big-volume metropolitan areas. Country people had every right to demand the truth about Telstra in the wake of the telecommunication giant’s posting of $3.2 billion profit. People in rural and regional centres are demanding answers to questions such as: why are the Australian taxpayers being asked to flog off an operation which clearly delivers enormous profits back to the major shareholder—the government of the people of Australia? Why, if Telstra is so obscenely good at sucking money from the accounts of ordinary men and women, is it better to have this organisation under full private ownership? Why is it that parts of Bendigo—even some very urban parts—cannot be connected to modern basic communications, such as broadband, yet Telstra itself can cream off such eye-popping profits? And why does Telstra forecast that it will not be able to continue to service regional Australia, yet its profits bloat boardrooms around the world?

Telstra’s profit statement is a sad indictment of 10 years of Howard government complacency. Under the Howard-Costello government, Telstra has been allowed to continue to cold-shoulder regional Australia while gorging itself on a captive market. The coalition has seen this obscenity as a reasonable way to set up an Australian communications service to be sacrificed on the altar of the Prime Minister’s free market ideology. Why anyone—let alone the government—should be happy at this rip-off of the Australian people and country people in particular is beyond me. Whose $3.2 billion do they think it was in the first place?

We tend to get bamboozled by the big numbers. However, the latest Telstra profit represents taking around $230 from every man, woman and child in Australia. It represents sucking more than $28 million per year out of the Bendigo electorate alone. The whole Telstra scenario is coming apart at the seams for the current government. Telstra’s new American boss, Sol Trujillo, is demanding more freedom from the government to make even more money, while admitting he has a multibillion dollar problem meeting his country commitments.

I am proud to say that Labor will continue to oppose the full sale of Telstra and is committed to retaining Telstra in public ownership. We believe that the rationale for the privatisation of Telstra is fundamentally flawed because of the government’s own incompetence. We are concerned about the impact of privatisation on services and employment, especially in regional centres like Bendigo.

Labor believes that the government must take the lead in implementing a national strategy for the adoption of new information and communications technologies and services, especially access to broadband. The ability to take such a lead will be far greater if Telstra remains in public ownership. The government, the major shareholder, is able to direct Telstra to make investment decisions which may be justified on broader terms rather than on purely commercial criteria. Labor is concerned that the interests of private shareholders will dictate investment decisions based on short-term financial gains, rather than on the national interests of Australia. Labor firmly believes we should keep Telstra connected to regional Australia’s future.

Steven Ciobo (Moncrieff, Liberal Party) Share this | Link to this | Hansard source

Perhaps the truest words in this debate were spoken by the member for Gippsland when he said that Labor lacks conviction and credibility. If there is one key message that we hear from Australians about the high level of cynicism that they have towards the political process, it is the fact that so often the rhetoric does not match the action. What do we see from the member for Bendigo and the member for Melbourne? They like to make the talk. The Australian Labor Party will say how committed it is. Just a moment ago we heard from the member for Bendigo that the Australian Labor Party is apparently committed to Telstra remaining in public ownership.

Mr Deputy Speaker, you will note that the member for Melbourne was remarkably silent about the ALP’s proposal with respect to the future ownership structure of Telstra. The member for Melbourne, the shadow finance minister, made no comment about what the Australian Labor Party would be doing with the balance of Telstra. We know from the shadow communications minister, Senator Conroy, that the Australian Labor Party would be looking at retaining the 30 per cent or so of equities that would be going into the Future Fund. Is that going to be the benchmark level of future ownership that the Australian Labor Party has?

Or perhaps we can go to what the member for Bendigo said. The member for Bendigo basically said that the Australian Labor Party’s view is that Telstra should have either majority public ownership of some 50 per cent and over or ownership in the vicinity of 100 per cent. That is what the member for Bendigo was saying about Telstra ownership, with his traditional Labor Left approach and ideology.

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

Labor is unrepresented in the chamber.

Steven Ciobo (Moncrieff, Liberal Party) Share this | Link to this | Hansard source

The Minister for Human Services, who is at the table, makes a very good point. The Australian Labor Party launched this MPI today. The Australian Labor Party came into the chamber and claimed that it is very concerned about the future of Telstra. At present there is not a single representative of the Australian Labor Party in the chamber for this debate. The Australian Labor Party, which says it is so concerned about the future of Telstra, is so unable to legitimise this rhetoric that it cannot even have a member sitting at the table for this debate.

Joe Hockey (North Sydney, Liberal Party, Minister for Human Services) Share this | Link to this | Hansard source

Oh!

Steven Ciobo (Moncrieff, Liberal Party) Share this | Link to this | Hansard source

Oh, finally we get a representative of the Australian Labor Party coming into the chamber. It is a delight to have a representative of the Australian Labor Party here to actually match the rhetoric. As I said from the outset, the whole thrust is that time and time again we see that Labor’s actions do not match the rhetoric.

The member for Melbourne said that the major problem is that the government is selling shares when the share price is falling. But let us turn that on its head, Mr Deputy Speaker. Can you for one moment imagine the Australian Labor Party’s reaction if the government was selling shares at a time when shares were increasing? If the government had a situation where we were actually putting equities into the marketplace when we thought we could get a higher price in 12 months or 24 months time, you can imagine the Labor Party’s reaction. It would be a little odd for them to say, ‘Well, now’s a good time to sell because in two years time you’ll be able to get more money for them.’

I do not know what the Telstra share price is going to do. I am not one of those who come into the chamber and profess to have some crystal ball and know where the share price is going. But I do know that on four separate occasions this government has been to the Australian people indicating our desire to privatise Telstra fully. The reason is the same reason we have heard from the Australian Labor Party, the same arguments that have been advanced by the Leader of the Opposition on privatisations: we know that privatisations are good for the Australian economy because governments should not be in business.

It is that simple. What we see as a result of the partial privatisation, and what we know will be the case through the full privatisation, of Telstra is that the Australian people will continue to benefit from a much more competitive, robust telecommunications sector than they ever would have under a monopoly telecommunications company like the old Telecom.

Despite the rhetoric—and this is the reason why the member for Melbourne is completely silent on what Labor’s policy is with respect to the ownership of Telstra—we know that the Labor Party would do exactly the same thing as the government: the Labor Party would privatise the remaining equity in Telstra. Despite the talk, the action does not match Labor’s words. That is the reason why people become so cynical about politicians and why they should be so cynical about the Australian Labor Party. There can be no doubt that if Labor were in government their actual policy would be to privatise the remaining equity in Telstra. That is very clear.

With respect to the way in which Australians have benefited from the privatisation of Telstra, what we see is that the average price of telecommunications services has fallen by more than a quarter—some 26.2 per cent. Mobile phone prices have fallen by 36 per cent and mobile phone subscriptions have risen from around four million to 18½ million. Through a more deregulated telecommunications sector, the number of carriers in this country has increased from three to 153 telecommunications companies. There are now more than 600 internet service providers. All of these service providers—new entrants into the marketplace—come from a more deregulated telecommunications industry. When we go back and look at the GDP growth that is attributable to this more deregulated industry, it is very clear that there is some $12.4 billion of value added to the Australian economy as a result of this government’s commitment to the liberalisation, increased competitiveness and full privatisation of Telstra—money which would otherwise not be there if Telstra had been left in public ownership.

In addition to that, I was interested in comments that the member for Bendigo made. These are weasel words, if ever I have heard them, because the member for Bendigo made the remark: ‘Labor is committed to maintaining a strong influence on Telstra.’ What does that mean? Does that actually indicate in some way that the Labor Party is going to retain public ownership of Telstra? As I said, the member for Melbourne made no remark on it. Does that mean that the Labor Party is committed to retaining 30 per cent equity in Telstra? Or is the Labor Party’s position a commitment to 51 per cent ownership of Telstra? Or is the Labor Party’s commitment to actually nationalising Telstra again and taking 100 per cent? Which one is it? What do the words ‘Labor is committed to maintaining a strong influence’ actually mean? They are weasel words. They mean nothing. It is rhetoric. We see from the Australian Labor Party that their actions do not match their rhetoric. The Australian people have every right to be exceptionally cynical about an opposition that lacks conviction and that lacks credibility. When the Australian Labor Party stand up and say, ‘We’re committed to maintaining a strong influence on Telstra,’ they know that those words ring hollow and that they mean nothing.

It is this government that has put in place the regulatory framework to ensure that we have a universal service obligation. It is this government that has put in place a Communications Fund. It is this government that has put in place the Connect Australia fund to ensure that we have regional communities with access to broadband. It is this government which actually moves beyond the rhetoric. It has invested billions of dollars in improving telecommunications and establishing a more competitive communications market in this country.

One of the key reasons that we have seen a decline in Telstra’s share price is because of the inherent conflict that exists between a former monopoly that is highly regulated and the situation where, through that regulation, we are delivering the services that the Australian people desire. What is very clear is that had this government not been thwarted by the Australian Labor Party but had actually been able to sell off the balance of Telstra years ago, when we first sought to do it, there would not be a problem with respect to the share price. One could only speculate on what the share price would be. If there is anybody that T1 and T2 shareholders should be concerned with, let it be the Australian Labor Party, because the Australian Labor Party have kept in place and exacerbated this fundamental conflict between regulation and shareholder value. It is the Australian Labor Party that have kept that position entrenched. So the decline in the share value should be sheeted home to where it belongs, and that is the Australian Labor Party, who have stood in blanket opposition to this full privatisation.

I urge the Australian people to cut through the rhetoric and actually seek some kind of commitment as to what the Labor Party’s position really is. They will attempt to weasel out of it, but they know a fully privatised Telstra represents a more competitive telecommunications market in the future. I am very, very pleased to support the full privatisation of Telstra.

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

I think we just saw a very good example of why people are very cynical about parliamentary processes and representation. Mr Deputy Speaker Causley, I was interested to see that you did not remove the member for Bendigo a moment ago for using the word ‘bribe’. I remember you took offence at that word when I used it.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

I have to admit I did not hear it, I am sorry, member for New England.

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

I believe you have used it in the past yourself in relation to speeches in this particular place. The debate that we are having today relates to the future of Telstra, and government members have spoken very strongly in favour of privatisation and the full sale of Telstra. What they have not mentioned is that they are not selling it. Thirty per cent of the business is going to be hived off into the so-called Future Fund, which is still public ownership. It is still owned by the people of Australia. Just because David Murray and a few friends of the Prime Minister are going to be the so-called custodians of the people’s asset does not mean it is sold. If the government was serious about this spiritual guidance that it follows in terms of privatisation being good for everything, why didn’t it sell the lot? If the government was serious about this spiritual divine guidance in terms of privatisation, why did it reverse its stand on the sale of Snowy Hydro? I will tell you why it reversed its stand on the sale of Snowy Hydro: because the Prime Minister started to listen to the people.

This government has not listened to the people on this issue. The National Party has been referred to on a number of occasions, and the Minister for Agriculture, Fisheries and Forestry made probably the worst speech I have ever heard him make in trying to defend something that is indefensible in terms of his own party. No-one from the National Party was in the chamber, other than the Deputy Speaker. There was no-one from the National Party here to represent their communities, who are obviously opposed to the full sale of Telstra. Any surveys that have been done by National Party members themselves, by Independents, by members of the Labor Party or by members of the Liberal Party—the member for Hume, for instance—have all demonstrated that country people in particular, but all Australians in general, do not want this sold.

Is it any wonder people are cynical about the political process when the people they put into this parliament do not represent the basic views that they themselves have made representations about; when their representatives do not represent their views in the parliament? I will tell you something, Mr Deputy Speaker. A lot of country people will have a choice at the next election, and this will be one of the issues at stake because there will still be 30 per cent of Telstra owned by the public. The Future Fund, as I understand it, has a two-year period before it can sell any more of our assets. I am not an expert in corporate law; maybe the minister at the table, the Minister for Human Services, is and he might like to speak about this. But my understanding of corporate law is that 30 per cent is a controlling majority. So the people will still have a say on this particular issue.

I urge country people and Australians generally: when they vote at the next election, look very closely at whom they are voting for, particularly those in the country who will have real choice in their members of parliament at the next election. They will be able to determine who represents them instead of those who turn up every three years or so and wander about, saying, ‘We are here to represent you,’ as the National squad often say. ‘We are here to represent you; we are here to represent you.’ We have seen what has happened with that sort of depopulation representation in the seat of Gwydir. Gwydir and Parkes have lost the greatest numbers in population of any region in Australia. Tasmania was in front of Gwydir a few years ago, but it has picked up in recent years. Then those people wonder why this is being brought upon them. Why are these dreadful people from the Electoral Commission perpetrating this dreadful event? I do not agree with it either, but one does not have to be Einstein to work out that the massive depopulation of some of these areas in country Australia is related to the policy of the people who are purporting to represent those people in the parliament—and they have failed.

The other word that I picked up on, other than the term ‘bribe’—which apparently you overlooked, Mr Deputy Speaker Causley—was ‘scratch’.

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

If the member for New England wants to reflect on the chair, I will deal with him.

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

It is the word ‘scratch’. This term seems to have been deleted from parliamentary language as well. It is not so long ago—I am sure you will remember, Mr Deputy Speaker—that the National Party in particular and government members in general were not going to sell Telstra until it was up to scratch. It is not all that long ago that the President of the National Farmers Federation, Mr Peter Corish—in fact, it was on the day that the sale bill went through the Senate and I happened to attend the press conference outside the Senate doors—said the words that I am about to recall and that persuaded Senator Barnaby Joyce to support the sale. I agree with Barnaby Joyce on some things, but I think he will carry to his grave the day he voted on this issue. I understand he was new to the parliament at the time and probably under enormous pressure. I fully understand that, but so will the people he purported to represent, when this operation is fully privatised at some time in the future.

The President of the National Farmers Federation said he had a guarantee in writing that would guarantee country people equity of access and pricing levels of basic telephone services and internet services, and it was called ‘up to scratch’ at the time. Here today, we still have this argument between Telstra and the ACCC—and the government, for that matter, who are putting their little wheel in there in relation to de-averaging the pricing regimes between city and country customers.

I will give some examples. Loomberah is in my electorate—not in the bush, not stuck out in the middle of Australia—15 kilometres from Tamworth. Telstra Country Wide did the appropriate thing: they conducted a survey to find whether there were a number of customers who would be available for connection to ADSL. That was done over six months ago. The numbers were obtained. Since then, customers in that area have been told a number of times that there would be a date when they would be connected to ADSL. They have been told that the firm from which Telstra gets its enabling devices to hook up ADSL in that particular exchange has been on strike. Then they were not on strike and now apparently they are back on strike. Apparently these people are in Spain. The same crisis is happening in other exchanges in my electorate and many other electorates, but the Dumaresq exchange, the Dangarsleigh exchange and the Loomberah exchange in my electorate have been told they cannot get the equipment. Even though all the processes that Telstra Country Wide put in place have been met, they cannot get the equipment to enable the exchange to give internet services to these people.

In conclusion, many people speak about how good it is where telecommunications have been privatised overseas. I was recently in the mid-west country area of the United States. The mobile phone service there is absolutely appalling. There are so many competitors that they cannot speak to each other. For three days I could not get service while travelling. One day, when I had to get a message to someone that I was running late for a particular engagement, I went through four medium-sized towns and I could not find a phone. I went to a post office and they said: ‘A public phone? A public phone? No, we do not have public phones.’ In the end I booked into a motel to access a telephone. For people to come here and say that in the American experience the consumer is much better off—go and look at what is happening in country areas. It may well be in the city, but the sale of Telstra is—(Time expired)

Ian Causley (Page, Deputy-Speaker) Share this | Link to this | Hansard source

Order! The discussion is concluded.