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

To you. When Senator Hinch asks a question of any official in front of him he will expect the truth to be told. Well, you are in for a very, very sad time—through you, Mr Acting Deputy President. When they sit there and say, 'We bought the HFC network believing that we could use it,' we know that internal documents say that they knew that it was not fit for purpose.

There is a lot of technical jargon in this particular world. You will, tragically, come to have an understanding in not too short a time. The document went on to explain that the nodes were oversubscribed—this is about the HFC network—that equipment was nearing the end of life and that NBN Co was considering overbuilding it entirely at 'significant cost'. So the internal document said, 'It is not fit for purpose, the equipment is at the end of its life and we actually have to overbuild it rather than use it.' That is what the internal working document said. That is the national security issue; that is the commercial-in confidence issue; that is the intellectual property issue—all of the defences they are using.

In 2012 Mr Turnbull himself said that this network that they bought—and we are talking hundreds of millions of dollars, not 50 bucks; we are talking $800-plus million—could be upgraded for 'a modest cost to provide NBN equivalent services'. It was rubbish then and this document proves that it is rubbish now. So little wonder that, in all of the hullaballoo and excitement that Senator Hinch has enjoyed—or endured, depending on your perspective—over the last few days, the NBN snuck out their report last week. Do you know what they did? They said that they were going to connect 1.5 million fewer premises to the HFC than they had predicted the year before. So 1.5 million Australian homes were not going to get, as they had been promised, the HFC connection, with many to be forced to use Mr Turnbull's favoured, even slower, second-rate copper network.

So 12 months ago they promised to connect about four million Australian homes using this network, and they already knew about the issues. I publicly said it was a dog. I did not buy it. I refused, because I knew that it was a dog and that it could not deliver 21st century broadband speeds. It was built in the last century and Optus had not spent a cent on it. But, no, Mr Turnbull knew better than all the experts and all of the advice. So last week the board themselves had to fess up to this 'national security' issue, this commercial-in-confidence' issue. Then, in December 2015, another document appeared which revealed two key things about Mr Turnbull's botched administration of the NBN. First, it showed that the cost of patching up the old copper network was estimated not at $55 million, as Mr Turnbull had claimed in 2013, but that it was going to cost $641 million. That is a blow-out, if you do the maths quickly, of 1,000 per cent. These clowns got it wrong by 1,000 per cent. Three years ago, when talking about his fiction of $55 million, Mr Turnbull assured the parliament:

… very conservative assumptions have been taken about the level of proactive remediation of the copper network …

Three years on—despite the best advice and despite, in an incoming government brief, being given categorical statements from people who know something about the copper network that it needed massive remediation—he told parliament that 'very conservative assumptions have been taken'. That is what happens, Senator Hinch—through you, Mr Acting Deputy President Bernardi—when you hire your mate whom you own a yacht with in Sydney into the company at $800,000, and you tell him the outcome you want before you start: he comes up with a very conservative estimate of $55 million to repair the copper network. Seriously? I know you are going to sit there and go, 'No, he's making this up.' I promise you, on my daughter, that is what he did. So, he hired his mate whom he owns a yacht with, he stacked the board with his old telco-sector mates who he has worked with before, and he came up with a 'conservative assumption'.

The document shows a 1,000 per cent blow-out in the cost. Apparently this is another national security issue, another commercial-in-confidence issue and another reason why we have to send the police in. But the document went further. As I said, it showed that the cost to the taxpayer of fixing the old copper network increased by more than 10 times. But the second thing that the December leak revealed was that in 2013—when Mr Turnbull was already the minister and had his yachting mate prepare the report—the report said that the second-rate copper network would only cost $600 per home, when in actual fact the cost has nearly tripled to $1,600 per home.

Senator Hinch—through you, Mr Acting Deputy President—you might think that it could not get any worse. There cannot be a set of steak knives to go with this fine meal that has been served up! Well, another document from December 2013, a document from inside the company while Mr Turnbull was the communication minister, revealed that Mr Turnbull was warned by experts in the company about the high cost of fixing up the copper network. NBN Co's input to the incoming government brief in 2013 made this clear. This is what the experts in the company told Mr Turnbull on his first day in office in that brief:

… significant network remediation will need to occur in the copper plant …

But Mr Turnbull knows best! Senator Bernardi, you have experienced it yourself. Mr Turnbull is the living expert. Mr Abbott, the then Prime Minister, described him as the man who invented the internet in Australia. I am not joking, Senator Hinch. Mr Turnbull ignored all of this advice. He hired his yachting mate, who had the cost of the NBN Co network presented to the parliament under his name. He got it wrong by nearly $30 billion and the time frame wrong by four years, and that bloke—believe it or not, Senator Hinch—has been promoted inside the company and given a bonus. Mr Turnbull's yacht-owning mate got a bonus. He did not get shown the door because he got the costing wrong by $30 billion, he did not get shown the door because he got the time of the build wrong by four years—he actually got a bonus and was promoted and given more responsibilities.

In February 2016, just this year, another document came out from inside NBN Co and it revealed that the NBN Co was running hopelessly behind on its internal targets. You might say, 'But just last Friday'—just yesterday in the parliament—'the minister claimed they had met all their targets.' This document revealed that the low-ball targets that NBN Co publishes once a year are so low, Senator Hinch and Senator Bernardi, that the three of us together could meet them if we got out there and said that we were in charge of connecting the homes. Just the three of us could meet their external targets.

But this document showed that the NBN Co were not actually meeting their own internal targets. It completely contradicted all of the claims of the Prime Minister, the minister, the CEO and the chairman of the company. Well! National security has been invoked! Official secrets have been called upon and the police have been unleashed to get to the bottom of who has dared to contradict the Prime Minister—who has dared to show that inside the company they know that they are not meeting the targets, because that contradicts what the Prime Minister and what the minister are saying. There are actual internal targets that they are failing to meet, and the documents showed that NBN Co has hit less than a third of its internal targets—less than a third for Mr Turnbull's second-rate solution—due to the poor quality designs and problems with connecting nodes to the electricity networks. You might think, 'How could you possibly not work out that you need electricity to run a node—those cabinets in the street? How could you get this so wrong?'

In April 2016, just a few months ago, another set of documents was leaked that revealed that not one single fibre-to-the-node area built by NBN Co itself under its own steam had been completed on time, not one. So in March—just go back one month—another document revealed that, under Mr Turnbull's fabulous brand-new $56 billion network to be built using the copper, up to five dropouts a day on this network were considered 'acceptable'. Fifty-six billion dollars of taxpayers' money to build a network that can drop-out five times a day is 'acceptable' to Mr Turnbull's mates on the board.

Acting Deputy President Bernardi has the NBN. He has got the real NBN. Do you get five dropouts a day, Mr Acting Deputy President? I know you are not in a position to answer from the chair. But ask Acting Deputy President Bernardi: does he get five dropouts a day on his fibre network, on the real NBN? He will tell you. He is trying not to embarrass the Prime Minister—the first time this year. There is a reason they will send you, Mr Acting Deputy President Bernardi, to New York three times in the next three years. Okay?

Mr Turnbull wants to flog off NBN Co in the future. I tell you what, Mr Turnbull is turning the NBN Co into the FAI of the telco sector. He is going to have one valuation for the public when they want to buy it and he is going to have his own private valuation where he knows it is a dog. He has destroyed the internal rate of return, and is now going to try and borrow $20 billion. You and I are all going to pay the extra tax tab on that. (Time expired)