Mary Fisher (SA, Liberal Party) Share this | Link to this | Hansard source

I wish to speak on the annual report of NBN Co. Limited, noting of course that the annual report of NBN Co. relates to the NBN Co. when it was in its infancy and covers a period of less than 12 months, ending in the financial year reported upon. What Australians are looking for is any sort of projection into the future from NBN Co. as to its ability to support what the government seems to continue to be hell-bent on implementing in terms of the $43 billion taxpayer spend on the National Broadband Network.

The concern about NBN Co. arises in large part from the significant taxpayer investment in NBN Co.’s infrastructure and in the employment of its people and, thus far, the lack of delivery of any significant services and any significantly new access to broadband by NBN Co. itself, with lots of megadollars being spent but very, very few, if any, megabits being delivered to this stage. The Australian people are looking to NBN Co. as a partner—at the moment, the stakeholder—in the government’s $43 billion National Broadband Network to reassure them that it can deliver its part in the government’s $43 billion National Broadband Network.

The CEO of NBN Co., Mr Quigley, did not much like it when his comments given to a Senate committee were reported—that is, his comments that the NBN project would not return a profit for some 30 years. Mr Quigley considered that the reporting of his comments to that end had been misconstrued. So, in the process of attempting to clarify the alleged misconstruction and misrepresentation and, in his attempt to clear the record, Mr Quigley said that NBN Co.’s business case showed that the project ‘would generate a return on its costs before the end of the construction period’. He then attempted to argue that the NBN Co. ‘would generate a positive return on its costs’ before the end of the eight-year construction period.

That bold projection—as pointed out by Terry McCrann in separate media—sounds pretty good except for the fine print. As pointed out by Mr McCrann, what Mr Quigley was essentially saying was that the NBN project would end being what is called in technical speak, EBITDA positive—‘that it would be in the black,’ as Mr McCrann said, ‘before you took out those four little letters ITDA.’ So it would be in the black with the EB bit—the earnings before. But if you actually took into account the ITDA, the interest, taxation, depreciation and amortisation—the significant costs, the big hits for NBN Co.—as Mr McCrann said:

The devil is actually in the IDA—interest, depreciation and amortisation.

Mr McCrann goes on to say:

The NBN will be in the black before IDA? Big very little deal. The NBN will have hardly any operating costs. But IDA—

interest, depreciation and amortisation—

will be huge. The NBN will be bleeding real—your—money big time for decades.

Mr Quigley said it was all fine because the business case would show that the project would generate a return on cost before the end of the construction period. When he was asked at Senate estimates to provide a copy of the business case, what happened? When I asked Mr Quigley to provide the hard numbers to support his earnings forecast, Senator Conroy overruled his answer. And what did Senator Conroy say? ‘You’re not going to be privy to them today, tomorrow, next week or after we receive the business plan.’ So Minister Conroy has effectively told taxpayers, ‘Not only will you not get a cost-benefit analysis, but we won’t even show you the numbers. I seek leave to continue my remarks.

Leave granted; debate adjourned.