Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Hansard source

It is very important that we try to ventilate this as much as possible and at every opportunity. This document, the business case summary, which goes to the essence of the motion, I will not even describe as flimsy. It has a paucity of detail. It is an absolute joke and should not be taken with any sense of dignity whatsoever. To respond to Senator Fielding, you just do not know what you are about to do. You do not borrow money from overseas to launch yourself into something which no-one can prove to you is actually going to work. You have got to be more provident with other people’s money. Let us just go for a little bit of a paw through this document. Right at the start, it says:

The Business Case includes robust sensitivity analysis throughout the plan.

It also says:

The NBN Business Case is based on detailed engineering, financial and business analysis …

Who do we refer to? Undertaken by whom? Give me even a footnote and a reference as to the competency levels of who is actually dealing with this. Give me something beyond just a statement. It talks about the ACCC review, and I will get on to that in a second. I believe the ACCC will have major concerns about this.

The document has ludicrous things in it. It was said to be a discussion of 50 pages, when it is actually 36, and it has pages like this one, page 3. I will tell you what is on this page:

Arrangements for the Commonwealth Government Business Enterprise (June 1997).

Full stop. That is it. That is all that is on that page. This document goes through flimsy motherhood statements. I do not know who put this together. There is no competency in this whatsoever. And if we drill down into some of the technical scenarios, on page 15, on the ‘Telstra Deal’, it says:

As no binding agreement has yet been entered into with Telstra, the Business Model includes extensive analysis of NBN Co’s No Deal scenario (which is a scenario set out in the Business Model) and a comparison between the two cases.

So we are examining the ‘No Deal scenario’. That is one of the premises of analysis of the ‘Deal’ scenario: we examine what does not happen, to work out what happens when something does happen. The minister has put this out! It is like explaining to people everything they are not, to try and work out what they are. Then there is this on pages 15 to 16:

Whilst negotiations and drafting of the Definitive Agreements are progressing well, there are no legal obligations on either party to agree—

What does that mean? There are no legal obligations on either party to agree—

and sign binding documentation other than to negotiate ‘in good faith’.

Well, there’s a good reason to borrow $27.1 billion if ever I heard one. This thing has got hairs all over it—and this has been presented to the Australian people. The reason you are gagging the debate is because you do not want us to discuss this. This is bedtime reading for monsters. It is just so pathetic.

What is on page 17? These words: ‘consideration process once the finalised special access undertaking can be lodged’—another one of those incredibly detailed pages! I will tell you what should go on that page, Minister: how the ACCC are going to have huge problems because of the ministerial discretion to override the ACCC and how that will actually affect other people in the marketplace. That is what should have filled up the rest of that page, and about 50 others. You know full well that within your legislation there is discussion about the ministerial powers that can override the ACCC so as to affect the deal. Those, of course, will stay in situ in the NBN Co. forevermore. That is yet another part that the Australian people are not to know about.

The document says the NBN’s projected internal rate of return ‘could decline by 50-80 basis points because of slower take-up of broadband and slower introduction of retail services that require higher speeds’. I would not have minded a bit more information on that, on exactly what is happening there. That is pretty important.

Everybody would like to know a little bit about the pricing; that is something I think the Australian people have a right to know about. I just want to help the Australian people out here. The document says:

The pricing structure and pricing levels have been set to achieve a viable internal rate of return (IRR) based on NBN Co’s estimates of take up of different speed tiers and connectivity capacity usage.

So the pricing is a variable. They do not have a clue about where the pricing is going on this—not a clue. All they can tell you is that it is going to be ‘viable’. ‘Viable’ means making a commercial rate of return. I do not think their current internal rate of return, at six per cent, is viable when the long-term bond rate is at 5.45 per cent. They say that is viable—it is totally unviable. Why wouldn’t they just stick the money in the bank? What is going to happen to the price of phone calls? A little bit more discussion on that would have been helpful. But this has been enough to convince the Independents, Senator Xenophon, Senator Fielding and the Greens, and the Labor Party to vote for this. This is them delivering transparency to us!

Then they start telling us what the internal rate of return is not, not what it is—the typical Labor cop-out. On page 21 it says:

This is based on a number of assumptions, the most significant of which are growth in speeds and demand and hence revenue. The stated internal rate of return is also dependant on the completion of the Telstra deal, which has a material impact on construction costs …

What exactly does that mean? It is just a nebulous statement, an amorphous blimp statement—nothingness in proxy for information. Once more again we go back to the rule-out clause:

The internal rate of return does not take account of any external benefits anticipated from the NBN to the economy, productivity or social outcomes.

Why do you need to say that? Why do you need to tell us what it does not do? What is the point of putting that in your so-called ‘forensic’ document—the document that has swayed Senator Xenophon and Senator Fielding, that has brought them across. Have they actually read this? Why would you put, in a document that you believed had some sort of prudential acumen, some sort of gravitas, a statement about what the rate of return does not do? Why not say, ‘This document does not affect the wanderings of the marauding wildebeest on the African plains,’ ‘This document shall not affect the climate,’ ‘This document is not part of any international treaty between Swaziland and North Korea,’ or, ‘This document cannot be driven around the block and used as a motorcar’? Why do we have these statements about what the return is not? ‘The internal rate of return does not take account of any external benefits anticipated from the NBN to the economy, productivity or social outcomes’—I imagine that means that this document does not help me talk to people on a Friday night at the pub. That is good—I am glad we got that off our chests!

Then there are lots of pictures. Pictures are always helpful, especially when they use up a lot of the page. It is great to have pictures in there! Then, on the capex, it says:

At the end of the contribution and deployment period, the total capital expenditure (capex) is estimated by NBN Co to be $35.7 billion.

They are lauding that as a big win. It continues:

This is lower than originally forecasted as a consequence of the pending deal with Telstra—

which we have no idea about—

This deal reduces the overall capex due to efficiencies as a result of the re-use of infrastructure and also the use of—

wait for it!—

longer term leases.

The capex is less because they are not actually buying the stuff—they are leasing it. So you get to spend this money but you will not own it at the end. This is the document that has brought Senator Xenophon and Senator Fielding across. This is it. We are not buying the pipes and the pits; we are leasing them. Telstra get them back at the end of the day unless they do not want them. Telstra had us over a barrel, and this is what you do. They saw Senator Conroy coming. They knew he was struggling. He is up to his eyeballs; even his colleagues are crawling all over him. People are a wake-up to it and all of a sudden there is panic. That is why we had the guillotine and the attempt to shut the whole show down.

Let’s continue through the NBN Co. business case summary, this magnum opus. Under 6.7, on page 30, it says:

The equity requirement from Government based on our current plan is $27.1bn.

What does that mean? Before, it was $26.66 billion. I know half a billion dollars is only loose change for the Labor Party. They just snuck that one in there—‘They won’t pick that up, will they? We won’t have any discussion as to why it has changed by half a billion dollars.’ Senator Conroy would not bother bending over to pick that up if he dropped it at the pub on a Friday night—‘Why would you worry about it? It’s only half a billion dollars; what’s that between mates?’ It is a wonder the Independents or the Greens did not ask some questions about that. Maybe, if we had not had the gag, we could find out what happened to that half a billion dollars. Maybe someone could tell us a little bit about that.

I wonder what we could do with half a billion dollars? I wonder how many hip replacements we could have with half a billion dollars? I wonder how many people’s teeth we could fix with half a billion dollars? I wonder how many roads we could build in regional Australia with half a billion dollars? I wonder how much we could spend on getting new drugs onto the Pharmaceutical Benefits Scheme with half a billion dollars? But the government do not care about this. They do not care about those sorts of details. They are too arrogant and hopeless and incompetent. I do not know what the other people are doing letting them get away with this. They show no resect for money and somebody somewhere has to pay this money back.

Anyway, the fiasco continues. It says:

Based on these parameters, a capital weighted [weighted average cost of capital] has been derived at 10 per cent-11 per cent over the 30-year period.

And what? Show me! Prove it! Give it to me in something beyond a statement. It goes on to the risk analysis. This is a clanger, the risk management; this is how we work out that we are not losing money, doing our shirt:

Whilst the execution of the risk management system aims to identify risks before they occur, for a number of reasons this is not always possible.

I will give you one of the reasons it is not always possible: because they have gagged it. That is why it is not possible. They have gagged it so that we cannot talk about it. The biggest risk to the risk analysis is the Labor Party, the Greens and the Independents. And they just dropped this in there:

Whilst the execution of the risk management system aims to identify risks before they occur, for a number of reasons this is not always possible.

What risk? Identifying what risk is not possible? Tell me more. I am curious. I am a curious person; I want to know what risks you decide not to take on board. I want to know what you have decided not to analyse, because by the look of this document it is the whole lot. I do not believe you have a clue what you are doing. Not a clue. You are totally clueless.

It is just so remarkable in its incompetence, but it is true to form. So help me, I am not even the shadow minister of this portfolio, but I do have the tendency to take the legislation and have a bit of a glance over it and after watching the minister for five seconds on national television I find out that I know more about it than he does. Why would you have a person of such utter incompetence in charge of something that we do not have the money for? We are borrowing this money.

Might I direct you also to the fact that when they say, ‘We’re borrowing $27.1 billion,’ it is with a caveat that they presume they can raise the rest of the money. If they cannot, they are going to borrow more. They are going to be borrowing more, and they will pay that money back to the people from whom they borrowed it. They are borrowing it from the good people of the Middle East, from the good people of China, from people predominately overseas, and these people will want a return on their capital. And Australians will work hard into the night—at the checkout, at the office, laying bricks, shearing sheep—doing whatever to pay for this stuff up.