Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

I thank the member for Lyne for agreeing to put me ahead of him at this time. It certainly helps my diary immensely and I thank him for that. I welcome this opportunity to speak today on the National Broadband Network Companies Bill 2010 and cognate bill. I really am very concerned at the way the government is trying to push these bills through so quickly to avoid part of the public scrutiny. We have seen much in the media but there should be more public scrutiny of the flawed NBN plan. The National Broadband Network Companies Bill will govern ownership. It will also be about the operations and the legal status of NBN Co., the Commonwealth owned builder and operator of the broadband network. It limits NBN Co. to business activities directly related to supplying wholesale communications services and sets out some arrangements for its eventual privatisation.

The Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Bill 2010I know it is a long title—also amends the Competition and Consumer Act 2010 and the Telecommunications Act 1997. It requires the NBN Co. to provide open and non-discriminatory access to retail carriers using its wholesale services and imposes similar access rules and NBN compatible technical requirements on non-NBN fibre rollouts.

I, like many of my coalition colleagues, am committed to ensuring that there is a universally available, high-quality broadband—‘high-speed internet’ is probably a better term—available at affordable prices. The National Broadband Network is a $50 billion investment—let us be clear about this—on behalf of the taxpayers of Australia. Whilst it may not be on budget it is still a Commonwealth funded proposal.

I have no doubt that we have to build our nation’s network, and it is the government’s role to ensure that where the network fails—and there have been many failures in the past, dating right back to the days of the PMG—the government should be there to invest in what I call the nation’s backhaul. In other words, we are building the nation’s network infrastructure—I call them our highways—through optic fibre cable and the network. The government should be there where there is a market failure. Markets do fail.

We need to develop the nation’s backhaul. We should be replacing, as part of the NBN proposal—we are still waiting to hear from the government on this—those single-channel radio systems that are the legacy of the PMG and Telecom, before Telstra, out in the outback of my electorate. There are single-channel radio systems in this day and age! There are microwave links going right out into the outback and up into the gulf and the Torres Strait Islands. These are technologies of more than a century ago and we should be replacing them. But the market will always fail to provide the upgrade of those facilities and that is where there is a role for the government.

The government rolled out, through NBN Co., a $250 billion optic fibre cable link between Darwin and Toowoomba. Many out in those committees thought, ‘The optic fibre cable is coming through my town; we’re going to get access to high-speed internet.’ I have had to tell them, ‘No, it is actually a duplication of existing optic fibre cables that are owned by Telstra.’ NBN Co. have upset many of my constituents because they felt that they could go through people’s properties and just advise them by letter, ‘We’re coming through.’ We have had many fights on the way with NBN Co. They thought they had greater rights than the title deed holder who pays rates on this land.

Maybe it is going to be good infrastructure in the long term but, even when they came from east of Mount Isa through to Cloncurry, if they had used the Landsborough Highway between Cloncurry and Winton it might have made a little bit of sense to me. But no, they went further east, to Marathon, and cut across Mitchell grass plains to Winton. They could have used the national highway—and the communities of Kynuna and McKinlay are along that highway. That would have enabled providers at some time in the future to connect national phone towers along a national highway that links Brisbane, Melbourne, Sydney and Darwin. But, no, they did not take that 300 or 400 kilometre route, which would have made sense. It is that backhaul, that connectivity, that would have enabled a connection to be made at some time by third parties rolling out mobile phone and wireless networks, albeit along a lonely stretch of highway north-west of Winton.

The other thing that concerns me is that this bill will mean there will not be appropriate parliamentary or public scrutiny of the NBN Co. The NBN is the single largest public works project in Australia’s history and it should be subject to some parliamentary scrutiny. It should be subject to investigation by the Productivity Commission as to whether it is appropriately funded and whether the money is being spent appropriately. Public works is part of it, but we on this side of the House are suggesting it should be investigated by the Productivity Commission. If the government believes it is such a good project then surely an independent analysis would be the best way to ensure we get value for money to provide the best services at the best possible prices. But no, the government is not going to let Public Works or the Productivity Commission oversight the greatest investment by the Commonwealth in any public works in our history.

This is probably only the tip of the iceberg for taxpayers, who are ultimately going to fund this project, but it does concern me that we have not had that public scrutiny. I am the voice of the people of the seat of Maranoa, which covers 45 per cent of the landmass of Queensland. The distance between the east of Maranoa and the west is further than the distance between Brisbane to Melbourne, and from north to south it is further than from Brisbane to Sydney. Across my electorate, communications are very important. I believe communications are a fundamental right. It should not be considered a privilege to have affordable modern communications—not only voice but increasingly data as well.

The tragedy of this legislation thus far, unless there is going to be a change of heart from the minister, is to see some of the nation’s backhaul, the nation’s network, being built where markets fail. We have not really heard from the minister; we have had soundings from him. I only hope he will listen to some of the councils in my electorate. What the coalition said prior to the last election was that we would have a fund that would be available to third parties to build an open access network where markets fail. One of those areas, in my own electorate, is the outback shires of Diamantina and Barcoo, where a single channel radio system connects Birdsville to Bedourie. They have a single channel radio system from Windorah to Jundah-Stonehenge. These could connect with Defence’s over-the-horizon radar facility. There is an optic-fibre cable from Stonehenge through to Longreach. It is the network they use to receive information from the over-the-horizon radar. These shires are prepared to put something like $2½ million to $3 million on the table. They have said that to the minister. I have supported their letters to him to replace those single channel radio systems. So in my electorate and, I am sure, and in other parts of remote Australia there are communities that are desperate to see that old technology replaced with optic-fibre cable. Because of the importance of it, it will be there in 20, 30 or 40 years time servicing those communities. It will allow a whole lot of other activities, including e-medicine. There is also a growing tourism market out there, so small businesses would be established around outback tourism.

We have got to upgrade the infrastructure. I have not yet seen any proposal put forward by the government that is going to guarantee to those communities a partnership arrangement between the Commonwealth, through NBN Co., and those two local council areas. I use them as an example because they are in a very remote part of Australia. From the coalition’s point of view, they are not forgotten people, and I just hope they are not forgotten people from the government’s point of view. The coalition government provided for this with the Future Fund. We put it into law that the money earned by the Future Fund would be spent every three years where there were market failures.

I would like the minister to also respond fully to the Glasson review of communications in rural and remote Australia. The coalition lost government in 2007. From 2007 to 2009 there was, we understood, some $300 million to be spent on addressing market failure out in those rural and remote parts of Australia and, in some cases, metropolitan parts of Australia, where markets also fail. I am sure the member for Macquarie can understand that—when you get into the Blue Mountains. There are market failures close to our large metropolitan cities.

The Glasson review and its recommendations have not been fully responded to by this minister. When we left office there was a fund of $2 billion that was earning something like $300 million over a three-year period that was to be used without having to go back to budget. The Treasurer cannot use the argument, ‘Oh, we were hit with the global financial crisis and we had to find savings.’ The money was there, invested by the Howard government to make sure that, where markets fail, we could address those market failures without going back to the taxpayer. I would like a minister to respond to that.

I want to touch also on Telstra Country Wide. I really want to know, with the agreement between the government and the board of Telstra, what they intend to do with Telstra Country Wide. Telstra Country Wide is out in those rural and regional areas. We put them there by regulation to ensure that they would be in regional Australia when Telstra was fully privatised. We did fully privatise it. Telstra Country Wide has been out there in the community with across-the-counter, face-to-face services. They have been invaluable, I can assure you, in the recent devastating floods and natural disasters. The minister at the table, Minister Bowen , would know. He came to Charleville in the March floods of last year. He knows how important it was to have Telstra Country Wide in the community, providing mobile phones and replacement phones for those people who may have lost them as a result of the floods. We saw it again in Dalby, Chinchilla and Condamine this year. They were there again. I wonder whether under NBN Co. and the separation of the wholesale and retail operations of Telstra what will happen to Telstra Country Wide. The Prime Minister says that this is a government for regional Australia. I am sure the member for Lyne heard that. This is a government for regional Australia. As part of this bill the government should tell us what they are going to do in relation to Telstra Country Wide and make sure that they continue to build the outback networks. (Time expired)

Darren Cheeseman (Corangamite, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak on the National Broadband Network Companies Bill 2010 and the Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Bill 2010. The National Broadband Network Companies Bill is about telecommunications, but it is also important to note that it is about the future of our health system, our education system, our commerce system and, importantly, our economy. This bill is about the long-overdue change that creates a telecommunications market that has integrity. As usual, it takes a Labor government to achieve this.

The bill consolidates the separation of the wholesale and retail parts of the telecommunications markets. It is also the mark of one of the most important economic reforms that the Australian government is undertaking. It is perhaps the most important thing we can do to increase the productivity of businesses in this country and particularly in areas like Corangamite. It will lead to a revolution in the use of household technology and it will open up new horizons for household entertainment. The Australian government’s national broadband strategy, which this bill addresses, will also lead to a revolution in the delivery of health services. Similarly, the NBN will lead to a revolution in educational services delivery.

This legislation goes to four things. The primary bill, the National Broadband Network Companies Bill 2010, limits and focuses NBN Co. on wholesale-only telecommunications activities, consistent with its mandate as established by this government. It also sets out the Commonwealth ownership arrangements and provides for the eventual sale of the Commonwealth’s stake in NBN Co., subject to parliament’s approval. The accompanying bill, the Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Bill 2010, establishes new access, non-discrimination and transparency obligations for NBN Co., and it provides a level regulatory playing field for superfast broadband infrastructure.

It surprises no-one that the Leader of the Opposition continues to oppose the deployment of the NBN network. He is opposing this great economic reform that the Gillard government is delivering. Mr Abbott is opposing the health service delivery revolution that will take place as a consequence of the deployment of the NBN network across this country. He is opposing the billions of dollars that will open up our economy and open up our health system. He is opposing the speedier, more timely delivery of health services to regional and rural Australians, and in particular to remote Indigenous communities. Mr Abbott is opposing the educational services delivery revolution that the NBN can bring. He is opposing the expansion of educational services to regional and remote communities. He is opposing the billions of dollars this will ultimately save the Australian government in educational services delivery. For years people who have a passion for this policy area have been dreaming of the day on which the NBN would be deployed, the day the retail arm would separate from the wholesale arm, and the day there were clear transparency obligations in how wholesale telecommunications business operate.

The Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Bill 2010 amends the Competition and Consumer Act 2010. This bill introduces open access, transparency and non-discriminatory measures for NBN corporations under clear oversight by the Australian Competition and Consumer Commission. It also requires owners of superfast networks that are rolled out, upgraded or altered after the introduction of this bill to parliament to supply a wholesale layer 2 bitstream service on open and equivalent terms. The NBN access bill also simplifies the making of industry codes and standards for fibre infrastructure and services so new fibre-to-the-premises networks are NBN consistent.

I think this is great legislation. We have listened for a long time to what industry are saying. We have listened to what consumers want. We made changes in the exposure bill, taking on board the suggestions of industry, such as the scope for the minister to allow NBN Co. to directly supply specific end users. We have listened to industry about matters such as that.

I just want to make the point that this important bill, covering these parts, will cause significant, economy-wide opening up of my region. My region—the City of Greater Geelong and the G21 region, as it is sometimes known—has been working very closely with my office to ensure that it can take full advantage of deployment of the NBN. We have in my region some 25,000 small businesses, with the lion’s share of those businesses in my seat of Corangamite. Many of those small businesses are tourism operators, and of course they rely upon the internet to market and sell their businesses on the world stage. There is no doubt that the NBN will assist those businesses to access the world stage, and I certainly believe the National Broadband Network will dramatically increase productivity coming out of my region as a consequence. We also have within my region many design companies, architects, tradespeople and building companies who need to send very large files to their customers, and the current network is inadequate for them to be able to do that.

We also have very large areas within my electorate where year 12 kids cannot actually email files from their school to their home or from their home to their school because of the inadequate telecommunications infrastructure that is in place. The NBN will very much assist those students in being able to undertake those very important activities, and I certainly believe that, as a consequence of the deployment of the NBN, educational opportunities will open up, enabling those students to achieve the very best of marks.

Also within my electorate we have Deakin University. Deakin is a critical institution for our region. It is one of the largest employers within the region and certainly is the largest employer within my seat. Deakin also has campuses on the Geelong waterfront—in the federal seat of Corio—in Warrnambool and in Melbourne. Deakin, as I said earlier, is the largest employer within my seat, and it has thousands of students studying there; it is providing that educational opportunity. Deakin University is also driving economic and business reform across our region, producing new industries and new jobs. The NBN again will play a vital role in enabling Deakin University to assist our economy in innovation, which is very important.

Deakin University is training many GPs, nurses and allied health professionals, who will service our region into the future. Of course, we know that there is going to be a revolution taking place in the health profession over the coming years, and I believe that internet based technology will play a very important role in enabling those doctors, nurses, surgeons and the like to communicate with a much wider audience than they have been able to in the past. I certainly believe the National Broadband Network will play a very significant role in that. This is a very large and important investment, and I think it will be the foundation for productivity growth going forward.

Of course, with all of these very tough and challenging reforms, Tony Abbott has consistent form on this. He continues to oppose everything that this government does in terms of opening up our economy and providing opportunities for this nation going forward. The NBN is critical to my region, it is critical to the nation and, as a consequence, I implore both sides of the political divide to support this legislation to enable the government to deploy the National Broadband Network as quickly as we can and particularly to assist regional Australia to get a leg up and get on a level playing field with our metropolitan cousins.

Robert Oakeshott (Lyne, Independent) Share this | Link to this | Hansard source

I also rise to support the National Broadband Network Companies Bill 2010 and the Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Bill 2010. I am quite obviously a supporter of better information and communication technology for regions such as the mid-North Coast and for regional Australia generally. I consider this more than just an NBN; I consider it an NDN—a national decentralisation network. Many members of parliament have talked about decentralisation, the importance of that and its place in building and empowering regional communities. This is, if done correctly, the opportunity to achieve that. I know many members have long been advocates for better ICT and for getting as close to equity as possible in the delivery of ICT services in the regions, whether mobile phones, television services or the internet.

Something that has been a frustration for a long time—in fact, it was mentioned in my first speech—is the example of a year 9 student living five minutes from a regional town who had to access the internet via dial-up, as much for technology reasons as for financial reasons. In all of this, we should not forget that while, yes, this is about technology it is also about the financial situation of many people and their ability to tap into the technology improvements that we are seeing rapidly coming into Australia. So this is fulfilling my commitment to her as a student in a regional area—trying to allow her as many opportunities as a metropolitan student. Hopefully we will allow the issues around rates of participation in education to finally start to be addressed in a way that we have not done before.

Also, there is the issue of employment opportunities, and I know the previous member talked about business opportunities. I quote the example of a veterinary business just outside of Wauchope that has been growing successfully and has become one of Australia’s leading veterinary oncology services. When I first heard about it I did not know and I suspect many people here would not have known that there was such a thing as a veterinary oncology service. They obviously now want to send files of a decent size, and they want to stay in a regional community to do their business. They are enormously frustrated by the lack of support with regard to both the speed and bandwidth abilities of existing services. If they want to grow their business then we have to provide better speeds and bandwidth to allow that innovation and entrepreneurship to flourish in a regional location. That is an existing business; we have not even started to explore the opportunities for innovation and entrepreneurship that may and will come if we do this right for Australia.

I separate the issues to do with the National Broadband Network into three areas: the technology, the spend and the politics. I am not going to talk about the politics tonight—I think that has been played out by plenty of others—but I will talk about the technology and the spend. The technology, I would hope, is broadly recognised across this chamber as a sensible approach to the future for Australia. Fibre cabling is unmatched for both speed and bandwidth. I was having a look inside the blue cabling the other day, and it is worthwhile for everyone who is interested to have a look at one of these pieces of cable, to see just what we are actually using now and the opportunity for technological improvement still within the scope of the fibre cabling. Inside one of those blue cables there are about 12 mini cables, and inside each of those—correct me if I am wrong, advisers in the chairs—there are 12 of what are the equivalents of mini cables within cables. To use 100 megabytes per second, I was informed that we are only using two of those 12 within the 12 inside the cabling. There is enormous opportunity for technological improvement of speed. It is about the connections at the ends. I gather we are up to one-gigabyte connections in the technology at the moment. And this same fibre cabling can handle that technological improvement.

So the argument that this is a rollout that we are going to pull out in 15 years and that everything will have moved is wrong. There is opportunity within this rollout for technological improvement. That is an important fact that I think gets lost in this debate. That room for growth in technology within the fibre structure is a huge opportunity for Australia in innovation. Hopefully, over the 15-year life of the cabling, it will be taken up and we will all be the better for it in our education and employment and our general life opportunities.

The issue of complementary measures is also an important one. I saw some of the commentary around the 4G release by Telstra. I know that in communities such as mine, and right around Australia, there are sometimes arguments thrown up that wireless or WiMAX or other technologies are competing with fibre. I would strongly argue that these are complementary, not competitive, measures. We do need a base network if we are going to run these complementary measures. We are not going to be able to get 4G in regional locations without the backbone of this fibre technology. So, if we do not want to just replicate what we have already done in the past, which has been the great criticism of our approach to ICT, and allow the market to solve the problem; if we are not going to just have 4G in capital cities and maybe a few regional locations; if we are genuinely going to chase the principle of equity; and if we are to allow the technology to do its job of allowing 22 million Australians to communicate with each other and with the world, then we have got to build the backbone—the backbone that will allow those complementary measures to hang off it—for that innovation to really be worthwhile. We need the backbone. As to the wireless technologies—the WiMAXs—I think they are all valuable and important contributions. I hope we see more of them and I hope that technology improves. But I think we sometimes get lost in the woods of the debate around speed and forget the importance of bandwidth. I think it is the dual contribution of speed and bandwidth which make a fibre network and platform important.

From that, we then get into some conversations around the costs. I have said many times before that that is the fertile territory for all of us: to try and minimise the initial costs and maximise the efficiency in the rollout. That is the challenge that I hope this parliament is willing to take up.

I am pleased to take on a role in the proposed Joint Committee on the National Broadband Network and I hope there are 15 other members in this place who, with similar intent, with me will do what they can to make sure we get value for money, we have an efficient spend and we minimise the overall costs to government for this important rollout for Australia. I am particularly heartened by the terms of reference. There is a whole range of issues for the committee to monitor in the progress of the rollout, particularly paragraph (2)(g) which gives the members of the committee fairly open scope to look at ‘any other matter pertaining to the NBN rollout that the Committee considers relevant’. In the debate that has happened until now there has been concern that the government is hiding something or that there is a fear of scrutiny or a fear of anyone having oversight to look for value for money. I hope with 15 other committee members we can provide that oversight and scrutiny to make sure we get the efficiency from taxpayers’ dollars that I know we are all looking for.

I also give my private members’ bill, the Auditor-General Amendment Bill 2011, a bit of a plug. To many people’s surprise, the Auditor-General has some limitations on jurisdiction in any oversight or auditing role regarding government business enterprises, one of which is NBN Co. I hope the bill currently before the House will broaden that scope and allows for an auditor-general to follow the money trail from the point of receipt from taxation to the point of delivery. That point may be through a state, a national partnership agreement, a GBE such as NBN Co. or a contractor—and there will be many people working on a contract basis for Commonwealth dollars in this rollout. The Auditor-General Amendment Bill is important in allowing the Auditor-General to provide backup support so that we really do chase those principles of value for money and efficiency in this rollout.

I think a wholesale platform built without vertical integration is an important starting point in this technology improvement. The concept of bundling is one I hope the government talk a lot more about than they have in the past because people are generally confused about why we are upgrading one internet service with another. People forget that this is a bundling opportunity for all technology to the home. Telephony services and television services will potentially come down the one fibre line and the cost to the household needs to be considered in the context of all those bills received by householders. That is the bundling opportunity in a rollout such as this. I think when most people do that maths they will see a huge opportunity for a reduction in their living expenses through what will be done by this rollout over the next decade.

As well, I hope the commitments given about the roll-in stay in place. I think it is a very important part of engaging regional Australia in this technology advance. I even encourage, if possible, some point-to-point rollout that allows for networks within the network to be built as quickly as possible: for example, a hospital-to-hospital network or a school-to-school network as an approach to trying to get as much benefit in the build process as we can as quickly as possible.

My final point is that we should not be nervous about having a conversation about an end point and where and how any sale opportunities at the end could or should arise. Again, my personal view is that economic forces on the platform do not stack up. More than likely government is going to be a monopoly owner of this platform for a long time. But where they do stack up—and metropolitan areas would be the obvious location—I do not think this parliament should be shy of that conversation and starting to frame how we would look for sale opportunities at an end point to reduce the cost to the taxpayer, so long as we keep vertical integration as a core principle behind the wholesale platform. That is a conversation I hope we can start alongside the rest. I hope we now can get on with the job of building the thing.

Tony Zappia (Makin, Australian Labor Party) Share this | Link to this | Hansard source

I take this opportunity to speak briefly in support of the National Broadband Network Companies Bill 2010 and cognate bill. Before I get on with my remarks, I commend the member for Lyne for his contribution to this debate. Few issues that I can recall from my time in this parliament have been debated as often as this matter has been. The claims and counterclaims have been expressed time and time again and the coalition’s criticism has been rebutted time and time again. The Australian people are quite understandably losing their patience on this matter. It was a key election issue in 2007. It was a key election issue in 2010 and, in particular, the cost of the NBN was a key election issue for the opposition in the 2010 election. Australian people have not been persuaded by the coalition misinformation and scare campaign on this issue which continues to date. It is a campaign which would have you believe that the cost of this project is something like $50 billion when the coalition know full well that the taxpayer contribution is about half of that.

If members opposite do not understand the importance of the NBN, let me assure them that the Australian people do. The people I speak with in my electorate do; the Independents in this place do, and we have just heard from the member for Lyne; the Australian people do. Clearly opposition members do not understand the significance of the NBN. They simply do not get it. Over 12 years in office they did nothing, and Australia fell further behind the rest of the world in the provision of high-speed broadband internet services. For the past three years the coalition have opposed the government’s NBN legislation every step of the way and at every opportunity available to them, most recently with a matter of public importance on this very matter only last Thursday. The member for Wentworth, who led that MPI as shadow communications spokesman, I believe does understand the importance of the NBN, so I asked myself, ‘Why the objection?’ I can only conclude that their political strategy is to block the NBN rollout so that at the next election they can go to the Australian people and say to them, ‘The government has failed to deliver the NBN.’

What is extraordinary is that the opposition, as the alternative government, do not have a credible alternative policy of their own, again highlighting that they simply do not understand the importance of this issue. Their view is that the market will sort itself out and that the private sector will build the necessary networks and provide the necessary services. That simply has not happened, and it did not happen during the 12 years of the previous coalition government. Again, there has been no credible alternative policy put forward by them—or, in fact, by the private sector—to provide the services that are needed.

Other speakers have spoken—I notice the member for Corangamite did earlier this evening—with regard to the productivity efficiency gains to be made from a modern, high-speed NBN. Those productivity gains would run into billions of dollars each year. Each year the rollout is delayed costs the nation billions of dollars. If there were ever a sustainable charge of costing Australians billions of dollars it would apply to the coalition for their opposition of the NBN rollout. But it is not just about dollars. It is as much about the personal and human benefits associated with a high-speed NBN. Whether it is in health, education, research, social life or entertainment—in fact, in every aspect of life—there are noticeable personal benefits from a high-speed NBN.

In Makin, the electorate I represent, poor access to reliable internet services is one of the most common issues raised with my office. The patience of the people waiting for decent internet services is wearing thin. They understand what the government is proposing and they want the government to get on with it. They have heard the opposition claims and simply are not persuaded by them. I welcomed the announcement last year that the national rollout of the NBN would commence in a number of areas, including the north-eastern suburbs of Adelaide, which is the area that I represent. I know that when I speak to residents in those areas they are quite excited by the thought that they might be one of the first communities to finally get some decent access to broadband services. I am also aware of the importance attached to a high-speed national broadband network by business. During the Howard government years businesses in the northern region of Adelaide had to enlist the support of Salisbury council to secure a decent broadband service. Salisbury council, to its credit, was able to deliver for them where the Howard government had failed to do so.

I have listened to this debate at length and I have listened to all sides of it, and it seems to me that the debate comes down to what I would suggest are three critical areas. The first relates to the cost of the NBN. The second relates to the monopoly situation that is being created as part of this proposal. The third relates to the cost and benefit of it. I want to talk about each of those areas briefly. In respect of the cost: yes, of course the cost is substantial. This is a significant national project, and if you compare the cost of the NBN rollout to the cost of other significant national projects in years gone by, it is not unreasonable. From my recollection, we went through an extensive tender process to come up with the proposal that we have before us right now. For all of the criticism by the opposition, they have not been able to put forward a credible alternative policy that delivers the same service at a better cost. I am also pleased to see that the government—we heard this only an hour or so ago in this House—will be establishing a committee to oversee the NBN rollout process.

Finally, cost comparisons have been made with similar systems in other countries and the costs of rollouts in those countries. It is my view that you cannot properly compare what is required in Australia to what is required in another country. Issues such as population density, distance between cities and other unique Australian factors simply cannot be factored in such a way that you can get accurate comparisons to other countries. If it could be done cheaper, I am sure it would have been.

I turn to the question of monopoly and the criticism that this will create a monopoly for the NBN network. National infrastructure has quite often been owned by governments in a monopoly situation. It is not at all unusual for governments to do that. In fact, there are still many examples of government monopolies over key public infrastructure. For example, if you look at who owns much of the water systems, the electricity distribution systems, the gas distribution systems, the postal services and telecommunications of this country, you see that they are all essentially either federal or state government owned monopolies. Previously we also had the government involved in things like aviation and a whole range of other areas where today a monopoly no longer exists. The roads throughout this country are owned by the government.

So to suggest that there is something unusual and something wrong about a company being a monopoly owner of key government infrastructure is, I believe, a very flawed argument. In fact, more often than not it has taken a government to make the necessary investment and then in subsequent years, once the system is running, to sell off the asset to private investors.

The third matter I want to talk about is the cost-benefit analysis. Again, this is a matter that you can debate at length, and it is very, very difficult to come to any finite conclusion. It is extremely difficult to accurately assess the benefit that will accrue as a result of having a modern, high-speed national broadband network. Let me use a couple of examples. Recently, with respect to the floods in Queensland, I heard several speakers commenting on how important it was that people were able to communicate with one another at critical times during emergency situations. It was because of that communication that people perhaps were able to save lives. How do you ever put a value on a life saved as a result of having the communications ability that a modern national broadband network would be able to provide?

We know that the NBN system will be able to provide cost benefits for our health system throughout the country. There are proposals in hand which will ensure that a high-speed broadband service in this country will be of immense value to our medical system and our health system around the country. Again, if one life is saved as a result of that system, how do you put a value on that?

But, if you want to go to productivity gains, I do not think anyone in this House would deny that having a high-speed NBN around this country would generate millions and billions of dollars of productivity gains for this country. I do not think that is in dispute. The sooner we have the system up and running, the sooner we will be able to benefit from those gains.

Finally, with respect to the cost-benefit analysis, I say this: we still do not know today what the infrastructure that we are dealing with will be able to do for us in the future. The applications and the systems through which we will benefit are still evolving and, in some cases, perhaps have not even been thought out. So how do you value something like that? I do not believe you can. I believe that there are questions that we need to ask. What systems do we have available to us today? Is there a shortfall? I think the answer is yes. How do we best proceed to ensure that we have the most efficient system for this country as quickly as possible?’ I believe the proposal before us does exactly that. That is why I support it. I commend these bills to the House.

Patrick Secker (Barker, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the National Broadband Network Companies Bill 2010 and cognate bill. I think it is interesting to construct the story about the cost of this huge white elephant. People sometimes get confused about ‘a million’ or ‘a billion’, but as I point out to people a million seconds is about 12 days but a billion seconds is about 34 years. So there is a lot of difference between a million and a billion. This legislation is proposing a $50 billion cost, which will end up being a cost to the Australian taxpayer. To put it in those terms, it is about $2½ thousand for every man, woman and child in Australia, whether or not you use the service. It is about $10,000 for the average family.

The Labor government’s broadband policy is to construct the National Broadband Network—or NBN, as we have come to know it. This will be a Commonwealth owned monopoly. The estimated completion date is 2021. I find it interesting that my friend over the other side, the member for Makin, suggested that they would do it as quickly as possible. Well, 2021 is hardly quick, Member for Makin. It is 10 years—and there is no guarantee that it will actually happen in that time.

Labor believe—and they keep telling us—that when the NBN is completed it will reach all of the nation’s 10 million homes and business. That is poppycock. Connectivity will be provided by fibre optic cable to 93 per cent of premises—but that does not mean that they will actually use the service—and by fixed wireless or satellite service to the remaining seven per cent of premises in regional and remote areas. Of course, that is where an electorate like mine, Barker, will come in. We will be a large part of that seven per cent. A large part of my electorate will be paying for a service, at $2½ thousand per person—man, woman and child—and they will not actually have access to that service. That is hardly fair. Labor’s stated objective is to ensure that 93 per cent of households have fibre to the home. That has become Labor’s so-called single solution and the end of the policy, when it should only be one of several possible means. It is also the least cost-effective available.

It is worth looking at the history of this National Broadband Network. I think colleagues on both sides would understand that at the 2007 election Labor promised a system for $4.7 billion—not $50 billion or $43 billion—and it was going to cover 98 per cent of Australia’s households. We said at the time—before the 2007 election—that that simply was not possible. And guess what? They got into government and after about a year they worked out that it was not possible. So, instead of saying, ‘We can’t do this for $4.7 billion and get 98 per cent of homes covered,’ they said, ‘We’ll have the big bang theory—$43 billion; we’ll go for a $43 billion system,’ even though most Australians, at the rate of five to one, are actually connecting up to wireless as we speak. That is the market. They are connecting to wireless, for the simple reason that those speeds are also increasing and it is far more flexible. More and more homes in Australia are not actually connecting to a telephone line; they are just using a simple handpiece, mobile phone or a dongle on their computer to get a wireless service, because they can take it anywhere and do not have to worry about a hooked-in line.

Fibre networks may be fine if you live in the city or if your business is in a built-up area, but the Labor government are selling this broadband plan to the whole of Australia and, realistically, not all of Australia will be connected to fibre—and they know that. Many of the residents in my electorate of Barker reside in areas that are considered black spots. The NBN will be of no use to these people. It will be of no use to the farmers in my electorate. It will of no use to the people who live in the smaller towns—of which there are many in my electorate. About 100 towns in my electorate will not be able to get fibre to the home, because they are considered too small—villages, perhaps. Most of these residents are already connected to the internet via a wireless service—which, interestingly, was brought about by subsidies that we brought forward when we were in government during the Howard government years. We did that on the basis of equity. We actually had a plan in 2007 that would have been completed by June 2009, and 99 per cent of Australians would have been covered. This government scrapped the OPEL plan and, as a result, we have still got a lot of people out there waiting for connections because there has been no replacement program.

I think it is very instructive to note that Dr Jay Guo, the leader of CSIRO’s Broadband for Australia research theme, says that wireless is eminently suited for regional Australia—I believe so; I have got it at home—since it can be rolled out more quickly and cheaply than the fibre network. As I said, in many places in my electorate they will never have that fibre service—not in my lifetime. Dr Guo said:

In terms of the cost to cover rural regional areas, especially given the fact that most rural regional areas have sparse populations, the wireless solution will be much cheaper.

This is exactly what the coalition had planned. We were not one-eyed when we developed our policy. We looked at what would be most effective and, more importantly, what would be cost effective.

More and more people are using mobile devices. You only have to look around this chamber. Everyone has at least two—and maybe three or four—electronic devices, such as personal computers, smartphones and iPad style tablets. Those are predicted to outsell traditional PCs this year, for the first time. Let us just think about that fact for a minute. In 2011 we are faced with facts suggesting that wireless style computing devices are going to outsell fixed devices, and that trend is growing. Yet the Labor government thinks it is a good idea to push ahead with a fixed-line monopoly that will not be completed for another 10 years.

I cannot begin to fathom why the government would still continue with the National Broadband Network. I am concerned for the residents of Barker, who will be paying for a network for years to come that, on completion, will be outdated and hugely expensive. How can this government present a model such as NBN and promise speeds and advances in technology in 2011 but then tell everyone that it will not be rolled out completely for another 10 years? This solution might be up to date right now, but let us be honest: what are the chances that this model will still be relevant in 10 years time? I would not bet on those chances.

Interestingly enough, Telstra unveiled its newest 4G technology. This will be a significant upgrade to its mobile network that will allow users to obtain speeds similar to home ADSL broadband connections while on the go. This will boost mobile internet speeds in capital cities and some regional areas by the end of the year—not in 10 years time but by the end of this year.

The Minister for Broadband, Communications and the Digital Economy, Senator Conroy, is confident that Telstra’s new technology will not interfere with his fibre-optic plan. He said, ‘Wireless is an important complementary technology to fibre.’ It is complementary, but it is more than that; it is actually taking over. The minister has said that wireless is important; so why has he forgotten all about wireless when developing the NBN policy? Why has he presented this inferior model for the NBN that does not utilise the best technology, which is changing every day?

The technology used in the NBN is not the only problem; it is one of many. The cost is a huge concern. It concerns me, and the rest of Australia should be concerned also. The government estimates that NBN Co. will require around $27 billion in equity funding and will need to borrow a further $10 billion to roll out the network. This $27 billion in equity funding has not been forthcoming. Nobody is putting their hand up and saying, ‘We want to invest in this. We think it’s a goer. We think people would be prepared to pay $200 a month.’ They are not coming the way of the government. If they do not, who is going to pay for it? The taxpayer.

If the NBN Co.-Telstra deal currently under negotiation goes ahead, NBN Co. and the government—hence the Australian taxpayer—will make payments to Telstra worth $11 billion in present-day post-tax terms for the use of its conduits and migration of its customers. The commonly used $50 billion price tag for the NBN adds these together: equity, debt and payments to Telstra. The head of NBN Co., Mike Quigley, has been quoted in CommsDay acknowledging that his construction budget is under pressure from the skills shortage, which has been made worse by the demand for skilled labour to clean up the damage caused by the storms and floods in Queensland. Mr Quigley said:

… we’ve done a detailed analysis of the skills we need in the company in order to build the network … there is a straight issue of will there be enough people to do this type of work in the construction industry? What I can tell you is that the view of the company won’t be such that we will just keep building regardless of the cost—if we find that costs are going up regardless of labor, we will go back to the shareholder and talk about that very carefully …

The shareholder will be the Australian taxpayer. In other words the NBN chief is saying that, if labour shortages mean his construction cost estimates are going to blow out, he will go back to government to get an okay to proceed at a higher cost or, alternatively, slow down construction until labour shortages have eased.

It beggars belief that a government could proceed with the NBN when the cost blow-outs have already made this an outrageously expensive rollout of technology that is very likely to be outdated before it is completed. What sort of arrogant government digs its head in the sand whilst the alarm bells are ringing? Taxpayers have every reason to be worried, as am I, that these problems are a sign of things to come with the NBN. Going by Labor’s track record of ‘easier to beg forgiveness later’, the NBN cost blow-outs could be massive. Will Labor just wait till the project is half rolled out then ask for more money from taxpayers to finish it, essentially giving them no choice in the matter?

I have seen this previously with the Labor government, in schools in Barker affected by Labor’s flawed Building the Education Revolution program. One school in particular had their hall ripped down and half rebuilt before they were told they would need to find half a million dollars of their own money to finish it. This government expected a drought ravaged town struggling to survive to come up with its shortfall. This ruthless government has exercised this sort of careless behaviour in the past; the NBN will be no different. As the price rises, so will the cost for taxpayers.

The problem with the NBN is that the government has kept it secret. Taxpayers should be concerned when a government refuses to let a huge, costly project go under the microscope. Only 160 pages of the 400-page NBN Co. business plan were made public. This is very concerning in itself. Then the government asked MPs who viewed the whole business case to sign confidentiality agreements. This is outrageous. It is deeply concerning. Australia has the right to know what is in those pages. You would not invest in shares without studying their performance and you would not buy a house without looking at the plans, so why is this government asking the Australian taxpayer to fund a $50 billion broadband model that they have no proper details about?

The bills before us today attempts to prevent the NBN from being scrutinised by the Public Works Committee Act 1969. Since 1988 all major government infrastructure projects have been subject to joint parliamentary committees, so why not this one? What have Labor got to hide? This is the first time to my knowledge that such a major project, the greatest project in cost of any government outlook in the future, is not subject to parliamentary scrutiny. Labor, you should hang your heads in shame.

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

in reply—I believe that the people who are opposing this bill and opposing the National Broadband Network should indeed hang their heads in shame. We have known for years that those opposite had countless plans—perhaps 20—which amounted to us being in the position of falling behind the rest of the world.

As government speakers have made clear, the NBN will provide broadband infrastructure to underpin productivity, prosperity and creativity into the future. Even opposition members have agreed that there is a need for much improved broadband services, noting a litany of poorly served areas. These bills ensure that NBN Co. delivers key objectives. Together the NBN companies bill and NBN access arrangements bill will ensure that the NBN operates on a wholesale-only, open and equivalent access basis, both now and into the future, subject to strict ACCC oversight.

Under this legislation there is transparency of the services NBN Co. provides and the terms and conditions on which it offers them. As a wholesale-only, open access network and without the conflicts that occur with also having a downstream retail operation, the NBN will drive fair and effective retail-level competition in the telecommunications sector across the country. It will mean more choice, more affordable prices and higher quality services for Australian households and businesses. Industry is crying out for this legislation to ensure NBN Co. adheres to the mandate the government has set it and to provide for its future operations.

The bills provide a clear framework for the operation of a superfast universal national broadband network with genuine retail-level competition for the first time across the country. In fact the bills are an important part of this government’s plan to transform the industry and provide genuine access to vastly improved broadband services across Australia. This is about advancing the future agenda in the national interest. Passage of these bills will ensure the new arrangements are in place as soon as possible, providing certainty for NBN Co., certainty for industry and certainty for the community. I commend the bills to the House.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.