Ian Macdonald (Queensland, Liberal Party, Shadow Parliamentary Secretary for Northern and Remote Australia) Share this | Hansard source

The Department of Broadband, Communications and the Digital Economy report for 2009-10 is interesting in what it says but perhaps even more interesting in what it does not say. In the seven key achievements of the department mentioned by the secretary in the report the suggestion of a cost-benefit analysis does not appear at all. In the four-paragraph performance review of the National Broadband Network there is no mention whatsoever of a cost-benefit analysis. In fact, the phrase ‘cost-benefit analysis’ does not appear in the index to the report at all.

I remind the Senate that Dr Ken Henry said last year:

Government spending that does not pass an appropriately defined cost-benefit test necessarily detracts from Australia’s wellbeing.

The government are continually quoting Dr Henry but they ignore him when it comes to the National Broadband Network, because clearly they are not introducing or insisting upon a cost-benefit analysis in what is perhaps the largest investment of taxpayers’ money in infrastructure ever by an Australian government. This superlarge investment does not go by the same rules that apply for other assessments by Infrastructure Australia. Infrastructure Australia in looking at any of their proposals have to go through a cost-benefit analysis, yet under this government this very substantial investment of public money, some $43 billion, does not even warrant a cost-benefit analysis.

When the government commissioned the $25 million study of the whole process they did not ask for an examination of alternative options and they did not ask for the merits of the policy. In fact, those that did the implementation study particularly made the point that they had been told by the government not to examine alternative options and not to examine the merits of the policy. The government never ask themselves: what are we trying to achieve and what is the most effective way of achieving it? One assessment firm has suggested that the NBN proposal would have a net present value of minus $9 billion.

A more prudent approach in my view would be to deal with areas of underservice around Australia and then, if demand progresses as time progresses and other technologies do not overtake fixed line connectivity, build greater connectivity. We have recently had the farce of the Prime Minister lecturing us all about economic Hansonism, yet here we are with a government that is proposing to overthrow 20 years of telecommunications reform and 20 years of competition policy by creating a new government owned monopoly over the fixed line communications in complete contravention of existing competition laws.