Ron Boswell (Queensland, National Party) Share this | Hansard source

Labor’s attack on the telecommunications future of the regions has been further confirmed this week with this legislation, which scraps the $2 billion Communications Fund set up by the coalition to future-proof services in country Australia. The government’s Nation-building Funds Bill 2008 was successfully amended earlier today in the Senate to prevent the transfer of the Communications Fund to the Building Australia Fund.

The Communications Fund was pivotal to the Nationals’ support for the final sale of Telstra. When we passed the legislation to give this commitment life, the then Deputy Prime Minister, Mark Vaile, said:

What we are delivering today emanated from a resolution of the Queensland National Party’s conference in 2005, when they decided to support the sale of the final tranche of Telstra. There were a range of recommendations there and one of them was to create the perpetual Communications Fund with $2 billion, and it is done.

To understand how crucial this fund is to the Nationals and to the bush, I want to trace the history of the Telstra sales and canvass the issues that were front and centre for us. When I was first a senator, in the 1980s, it was not easy to contact a grazier in western Queensland unless you chartered a flight out there. Party lines meant that several families shared a single and often unreliable telephone line. STD call rates commonly applied between a homestead and a cottage on the same property. School of the Air services were also inadequate. New phone connections took months, and the onset of the wet could mean long outages of communication lines. Meanwhile, the rest of the world was improving its productivity, and cities were making leaps and bounds in communications based service delivery.

At that time, the Labor government owned Telecom. It was obvious that rural services would have to be greatly improved if primary industry were to be competitive and if rural families were to be treated the same as other Australians. The infrastructure upgrade required would be substantial. Labor had three choices: to fund the upgrade through its budget, to fund the upgrade through the sale of its shares in Telecom or to just leave Australia as it was. Labor chose the third option: they did nothing. The complaints about Telecom grew progressively worse.

Three years ago I tried to ring the same grazier out west whom I could not reach years ago because of the party line system. He took the call, on his mobile phone, out at the windmill on his property. Ten years had made a big difference to communications on the land, thanks to a coalition government that was prepared to back rural Australia with cold, hard cash—cash which has bought hundreds of mobile phone towers, abolished the pastoral call rates so that that everyone is now on untimed local calls, put the internet into remote homesteads for the cost of a local call and enabled the rolling out of high-bandwidth services. Who had ever heard of ‘bandwidth’ 13 years ago?

Where did the cash come from for this revolution? Remember the harsh decisions that had to be made by the coalition’s expenditure review committee in the first few years of government to cope with the Beazley black hole? There was definitely no room in the budget for major capital investment in bush telephones and there were many competing demands from city MPs, who greatly outweighed rural MPs. So rural telecommunications was in dire straits.

Then came the sale of the first part of Telstra, in 1997. The T1 sale saw the establishment of Networking the Nation, a general fund for regional telecommunications infrastructure, which served to highlight how thirsty the bush was for telecommunications infrastructure. The budget bottom line meant that we could not apply for help. So the Nationals eyed off the sale of T2 as a momentous opportunity to fill the gaps identified by the NFF and the Networking the Nation fund. The T2 sale only went ahead once the Nationals had secured a landmark billion-dollar social bonus package for regional Australia. This suite of programs effectively brought rural Australia online, abolished the inequitable timed local calls and saw the installation of hundreds of mobile phone towers across rural and remote Australia. Local government, education, health and even legal services were enthusiastic participants in the great hook-up that occurred as a result of the social bonus package from T2. This partial sale of Telstra, owned by all Australians, funded the infrastructure needed by the bush. There was no other way to do it.

The new millennium found rural Australia very communicative. So many options and new technologies left everyone with a taste for more—more mobile coverage, faster speeds, fewer wires, fewer faults and shorter connection times. Service, service, service! The coalition government responded with two inquiries—the Besley inquiry, in 2001, which led primarily to $163 million for mobile phone towers in smaller and smaller towns, and the Estens inquiry, in 2003, which identified broadband issues and even more mobile phone towers to be funded by the government at a cost of over $180 million. While all this money was being spent, the coalition government also moved to tighten up the regulations governing telephone companies to improve competition and enforce a customer service guarantee. All of these measures were collectively responsible for the great leap forward in the bush. This would not have been possible if the sale of Telstra had not provided the cold, hard cash to reinvest in rural infrastructure.

Then we were faced with the sale of the balance of Telstra shares. There was $1.1 million reinvested in broadband and mobile connections in rural areas. This could not be funded from the budget. There was also a $2 billion perpetual communications fund to deliver rural communications into the future where it is not otherwise commercially viable to do so. This was no time to hang up on a telephone company out of nostalgia for the times when you could never get a line. If rural Australia wanted the technology, the competitiveness, the connectedness and the education, health and other services deliverable by modern communications then there was no going back to Telstra. Telstra had to be sold to finance the major, ongoing reinvestment required. Such was the thinking of the Nationals and the people in rural, remote and regional Australia.

On 5 August 2005, state Nationals leaders from New South Wales, Queensland, Victoria, South Australia and Western Australia welcomed a unanimous resolution from a special joint conference of state National MPs on Telstra. This resolution mirrored the resolution that was passed by the Queensland Nationals conference the previous week and subsequently endorsed by federal Nationals MPs. It stated:

This meeting of state Nationals MPs from across Australia resolved to oppose the further sale of Telstra unless all Australians in metropolitan, regional, rural and remote areas are protected from telecommunications market failure which may prevent the provision of parity of technology, services and price into the future between metropolitan and regional areas.

Towards this goal, this meeting of National Party members of parliament called for the following implementation of this resolution:

The establishment of a permanent and significant trust fund with the earnings used to provide future technology and infrastructure upgrades at parity price and service with metropolitan services in case of market failure (utilising a competitive tender process that considers providers with a permanent presence in regional Australia).

Today the Senate is faced with a decision of whether to recant on this first pillar of the covenant we made with the bush. On the day we introduced legislation to live up to our commitment and had shaken hands with the people of the bush, the then minister for communications, Senator Helen Coonan, said that the telecommunications legislation amendment bill would ensure that regional Australia’s perpetual $2 billion Communications Fund could not be pillaged. She said the bill protected in legislation the $2 billion principal of the Communications Fund so that only the interest earned from the fund’s investment, up to $400 million every three years, would be spent. It would also provide certainty for the people in regional and remote Australia that the improvements in their telecommunications service would keep pace with the rest of the nation.

Labor had committed to draining the entire $2 billion from the Communications Fund, to rob the bush of its ongoing funding and to squander it on a commercially viable network estimated to reach around 75 per cent of the population. The passage of this bill through the parliament will protect rural and regional Australia from the gross economic irresponsibility of the Labor Party.

The Communications Fund was established by the Howard government in 2005 and provides a guaranteed income stream to fund hard infrastructure for regional communities such as additional mobile towers, broadband provision and even backhaul fibre capabilities. Interest earned from the Communications Fund is used to implement the government’s responses to recommendations made by the triennial independent regional telecommunications reviews.

In speaking on that bill I said that it seeks to lock up $2 billion that the National Party won in exchange for the sale of Telstra. In the party room or forums we said that, if Telstra is sold, then we want to ensure that rural and regional Australia never gets left behind as it was at the end of the Labor administration. I told the Senate that this bill seeks to lock in that $2 billion under the legislation and it can never be removed unless Labor has a majority in the Senate. I look around and I do not see a Labor majority in the Senate and we will see that when it comes to the vote.

I know that the Nationals do not walk away from a handshake with the people of the bush. We promised them this fund for their telecommunication future. They said: ‘On the basis of our trust in you to keep to that, we say, “go ahead and finish the sale of Telstra”.’ I will walk across the floor before I will walk away from that trust. I note that the opposition in the other place has just voted to insist on the Senate’s amendments. When I vote that way too, who will be really crossing the floor?