Nick Xenophon (SA, Independent) Share this | Hansard source

I move amendment (16) on sheet 7005 revised:

(16)  Schedule 1, item 31, page 59 (after line 7), at the end of clause 74, add:                            

           (ca)    the principle that Telstra’s wholesale/network business unit should have discrete branding and identity to that of its retail business units;

           (cb)    the principle that Telstra’s management and personnel should be strictly separated between:

                   (i)    its wholesale/network business unit; and

                  (ii)    its retail business units;

                      and that remuneration should be tied to business unit performance, not group performance;

           (cc)    the principle that Telstra should maintain strict information barriers between:

                   (i)    its wholesale/network business unit; and

                  (ii)    its retail business units;

                      and that Telstra’s retail business units and its wholesale customers should interact with Telstra’s wholesale/network business units using the same information systems;

           (ce)    the principle that Telstra should maintain separate financial accounting between:

                   (i)    its wholesale/network business unit; and

                  (ii)    its retail business units;

        (2)    In determining the principle of equivalence covered by paragraph (1)(a), regard must be had to whether:

             (a)    the terms and conditions relating to price or a method of ascertaining price; and

             (b)    other terms and conditions;

on which Telstra supplies regulated services to its wholesale customers are no less favourable than the terms and conditions on which Telstra supplies those services to its retail business units.

        (3)    Subclause (2) does not limit the matters to which regard may be had.

        (4)    Disregard subclause (2) for the purposes of subsections 577A(2) and (3).

This amendment relates to the functional separation principles. It requires that there be separate branding and identity between Telstra’s wholesale network business and its retail business unit. This amendment further specifies that there be strict separation between their information sharing, financial accounting and personnel. This is to ensure that there is a distinct and identifiable difference between the two entities. This amendment also provides that, in determining the principles of equivalence, which we discussed earlier today and last night, regard must be had to the terms and conditions and methods of ascertaining prices to ensure that what Telstra wholesale supplies to its wholesale customers is no less favourable than the terms and conditions applied to the Telstra retail unit. I emphasise that this amendment relates to the issue of functional separation. I said previously that functional separation would be a poor second cousin to structural separation, but it enhances those principles in terms of equivalence, pricing, accountability and ensuring that the separation is as strict as possible if it is a functional separation. I know that the government is likely to support some but not all of this amendment. I will wait to hear the government’s position in relation to this amendment—and, of course, the positions of my colleagues in the opposition and on the crossbench.