Nick Minchin (SA, Liberal Party, Minister for Finance and Administration) Share this | Hansard source

In response to that question, I reiterate that it is indeed the board which has the sole authority in relation to the dividend policy of the company. It is a matter that they take very seriously and they do so in accordance with Australia’s corporations laws. It is certainly the case—and it is something that we made very clear in the public arena—that, in relation to the question of whether or not the government proceeded with any further retail offer of Telstra at the current time, the government as a potential seller of shares would require before it could proceed, as a precondition to a further offer of shares, clarity in relation to dividend policy going forward and some understanding from the company as to the nature of the commentary that it might or might not be making with respect to the regulatory arrangements during an offer period.

Those preconditions for the government to proceed were of course conveyed to Telstra, indicating that we were in the situation where the clear advice to us from our professional advisers was that we should not go to the market unless there were those preconditions. They were entirely, of course, a matter for the board. It was reiterated in my meetings with Mr McGauchie that these were matters entirely for the board. It was my task to convey to Mr McGauchie, representing the board, that we could not proceed if they were not in a position to provide that clarity in relation to dividend policy or indeed to provide assurances to the government as to the nature of their commentary on regulatory matters during the offer period. The board considered those two matters.

The board then, of its own volition and in accordance with its authority, issued a statement based on its financial advice and its perspective on the position of the company that it would be paying the same dividend that it has been paying—28c per share in 2007—but it could not give specific guidance in relation to 2008. The government received requisite assurances with respect to the company’s position on its commentary on regulatory matters during the offer period. On that basis, the government felt that it was in a position to make the announcement that it made some 10 days ago that it would proceed with its offer. I reiterate that this is a matter entirely for the board. Indeed, what Senator Conroy is at the very least implying is an utter slur on the board—that the board has ignored its corporate responsibilities by being coerced by the government. That is a slur on every single one of the board members at Telstra, and Senator Conroy should withdraw it.