Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Hansard source

The prospectus for the impending sale of Telstra, released yesterday, is a damning indictment of the government’s mismanagement of the sale process; it is a black mark on the economic credibility of this government. While there has been an army of highly paid investment bankers tricking up the incentives in T3 to ensure that the float is oversubscribed, these efforts have been undermined continually by the government’s incompetence. What the T3 prospectus has revealed is that, in the eyes of the Telstra board, the government’s behaviour in recent months, and the way it has structured T3, undermine the medium- to long-term prospects of the company. Whether forcing a mate of the Prime Minister onto the Telstra board, creating an overhang of shares in the Future Fund or putting Telstra’s dividend under threat through regulatory uncertainty, the Howard government has undermined T3 every step of the way.

On top of this, the childish and unedifying public warfare the government is pursuing against the Telstra board and management will serve only to undermine investor confidence in the company. How can the government look Australian investors in the eye and ask them to participate in T3 when, every other day, it is attacking the company’s leadership and direction? How can the government ask Australian investors to have confidence in the future of Telstra when it clearly has absolutely no confidence in the leadership of the company?

The fact that the government is, on the one hand, trying to talk up the sale of Telstra whilst, on the other hand, trying to undermine current management shows economic incompetence on a spectacular level. Is it the government’s position that the current board and management of Telstra are loose cannons who cannot be trusted? If so, why hasn’t the government sacked them in this row? If not, why is the government constantly attacking their leadership and direction? Is it the case that Howard government ministers and backbenchers are simply so arrogant or ill-disciplined that they cannot resist pursuing a personal grudge even when it is against the interests of the Australian public?

As I said earlier, this entire farce is a black mark against the government’s economic credibility—that is, what little economic credibility the government has in the area of telecommunications after John Howard’s recent claim, when T2 was up for sale, that T2 was ‘an extremely good deal’. It was so good a deal that those who listened to the Prime Minister’s shonky economic advice lost almost half their money. The T3 prospectus makes it clear that those who were burnt in T2 by Prime Minister Howard’s irresponsible actions should be very cautious that the same thing does not happen in T3.

The first cause for concern in this regard identified by the T3 prospectus is the government’s intention to force Mr Geoff Cousins onto the Telstra board. Let us review Mr Cousins resume—all of his resume. Senator Ronaldson stood up yesterday to defend Mr Cousins. He said that he is a big company director who has run big companies and has heaps of experience in telco. Then he proceeded to talk about everything except his experience in telco. Why is that? Let us deal with Mr Cousins’s resume. He has been a consultant to the Liberal Party and a personal confidant of the Prime Minister for almost 20 years. His only experience in the Australian telecommunications sector was a stint as the CEO of Optus Vision. You will not hear the name ‘Optus Vision’ pass the lips of any government senator or member. Why is that? It is because Optus Vision, while Mr Cousins was its CEO, cost investors more than $4 billion in losses. During that time, Mr Cousins developed an industry-wide reputation for combativeness and rudeness. It is difficult to know which of these qualifications Telstra shareholders should be more concerned about.

At Friday’s investor day held by Telstra, the Telstra CEO, Sol Trujillo, stated—