The Temporary Chairman:

The committee is considering Australian Greens amendments (1) and (2) on sheet 7006 moved by Senator Ludlam.

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

The amendment dealing with the objects of the legislation are very, very important for us to consider, because this is all about whether this is affordable and whether or not the business case has actually been made out. From a 400-page business case, the Labor Party say they have given us a 50-page summary.

Senator Conroy was not able to count the number of times ‘NBN’ is mentioned in the legislation. Remember that he appeared on national television saying that the legislation before us does not deal with the NBN, when the NBN is mentioned in the legislation not once or twice, not 50 times, but on 62 separate occasions. That is the ignorance with which the minister has clothed himself to enter this debate. That is the ignorance with which the Labor Party, the Greens and the crossbenchers are now saying that we should rush this legislation through the chamber without proper consideration.

The summary is not 50 pages; there are in fact 36 pages. You might think, ‘Well, what’s a factor of 14 pages?’ But if you go to page 6, you see that it does not even have a full sentence on it—it is blank. And so it goes on and on throughout this document. To say that it is a 50-page document is simply wrong. One might say that it has 36 pages. Yes, there are 36 separate pieces of paper but without type on them. That is the scandal with which the Labor Party come into this place, trying to hoodwink the Australian people.

This summary document is one of the most flimsy and most pathetic documents I have read. It was prepared by NBN Co. themselves—and guess what? NBN Co. say it is a robust document. It is their business plan. Would they say, ‘We don’t have a robust case; it’s going to go broke; it’s no good’? I have never heard of a business plan that does not seek to promote itself.

I recall as a young lawyer being in the magistrates courts, and the prosecutor would always say, ‘We have a strong prima facie case against the accused.’ I got sick and tired of that after a while and I said, ‘Your Worship, have you ever heard a prosecutor admit, ‘We’ve got a pretty weak case on this fellow’? Never once. It is the same with business plans. They never once will say, ‘This is a weak business plan.’ They will always say that it is robust. And you know what? In the very second paragraph of the summary, we are told that ‘the business case includes robust sensitivity analysis throughout the plan’—robust.

This is what has convinced the hapless crossbench senators to now support this—because that is what the summary says. But they have forgotten that the government itself does not believe that this is robust, because it has engaged the services of Greenhill Caliburn business assessors to assess—and the government uses these words—‘the robustness of the plan’. The government itself does not accept on face value that this is robust and will hide from us the report from Greenhill Caliburn on whether the business case is robust until after we have voted on this legislation and until after the parliament has risen.

This is an absolute abrogation of duty and responsibility by the Australian Greens and crossbench senators. I would have thought that they would have learnt their lesson—waving through government programs that have seen the deaths of four of our fellow Australians and 200 roof fires with the debacle of the pink batts scheme. They were convinced that the government had it all in hand and that we did not need to scrutinise it in the way the coalition said it should be scrutinised, so they just waved it through. It is on their heads that there have been 200 roof fires—just as much as it is on the head of the hapless Minister Garrett.

We could move on to the Building the Education Revolution, where there has been blow-out of over $1 billion. Indeed, the pink batts scheme, costing the taxpayer $1 billion has now blown out, with remedial work being needed, by another $1 billion. That is $1,000 million to be funded by the Australian taxpayers because the crossbenchers and the Greens were not willing to do the hard yards, the hard yakka, in relation to assessing government programs. If they failed so comprehensively in relation to the pink batts program, the Building the Education Revolution program and the $850 million blow-out on the Green Loans scheme—or should I say scandal—surely, after all those experiences in the three long years of Labor that we have had thus far, they should be saying: ‘The amber light is flashing; we should take some caution in relation to this. We should be provided with the full information.’ But no, they have gone cap in hand with the government to allow a $43,000 million program to be waved through this parliament without any proper and fair assessment.

And what should make the amber light go red for those opposite is when the hapless Minister for Broadband, Communications and the Digital Economy, Senator Conroy, who is in the chamber, appears on national TV and says that the legislation we are now dealing with does not involve the NBN; that it is not mentioned. The problem is that the minister had never creased the spine of the bill. He had never opened the bill. If he had he would have seen that it is mentioned 62 times. That is the sort of ignorance with which the Labor Party have entered into this debate and somehow—I still do not know how—have conned the crossbenchers.

I refer to the media release put out by my good friend Senator Xenophon. It is headed ‘Government agrees to publicly release full NBN summary’. That is like saying that this is a full half glass of water. How can you have a full summary? You either have a summary or part of it or the full document. We in the coalition are demanding and requesting the full document because there is no doubt that this summary is flawed. You do not have to go far into the document. Indeed, on page 4, under ‘Business Environment’, part of this business plan is a simple, pathetic regurgitation of what the government’s objects are in relation to the NBN.

Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

Mr Chairman, I rise on a point of order. I seek your guidance. This debate is about perfectly reasonable amendments to the objects clause of the Telecommunications Act. Does Senator Abetz need to be remotely relevant to the amendments or is he able to just discuss whatever matters come into his head? I just seek the guidance of the chair.

Alan Ferguson (SA, Deputy-President) Share this | Link to this | Hansard source

Senator Ludlam, I have been listening carefully to Senator Abetz and I can assure you that he is being relevant.

Eric Abetz (Tasmania, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

Thank you, Mr Chairman. I can understand the Greens’ huge embarrassment, having voted for the gag time and time again to truncate discussion on this because they do not want these matters aired. I was wrong about the page number, so the point of order by Senator Ludlam was helpful to me. I was, in fact, referring to page 7, where the summary of the business plan says ‘Key objectives’. All the NBN Co. does is regurgitate:

The Government has stated its broad objectives for the NBN as follows ...

How is that in any way, shape or form giving us information about the NBN’s business plan? All they are doing is regurgitating the propaganda of the government, and they cannot even do it properly. I draw the attention of those in NBN Co. who drafted this document to page 7. It says:

The Government has stated its broad objectives for the NBN as follows:

“The new superfast network will:

Then they go through dot point after dot point after dot point, but the inverted commas stop at the second last dot point. So one wonders: is it an objective of the government:

To design, build and operate the broadband network required as the foundation of the Government’s NBN policy ...

If that is not part of the government’s objectives, what is it doing indented in the paragraph in this way? This shows that this document has been put together in a sloppy and unprofessional manner, or in indecent haste. I suspect the latter. If you recall, Labor was saying it is completely and utterly inappropriate to release any of the business plan, that it was top-secret stuff and that it would take them more than 14 days to analyse the 400 pages to determine what should be deleted. All it took was one Independent senator to say, ‘I’m not sure that’s good enough.’ All of a sudden they can produce 36 pages of documentation which allegedly does tell us all about that business plan, which only two hours earlier had been ruled out as being completely unacceptable. This is from a government that got into government doing deals with the Australian Greens and the country Independents on one very important proviso: we would have ‘Operation Sunlight’—there would be complete transparency, there would be openness and there would be no secrecy. And what do we have? The Independents and the Australian Greens, cap in hand, voting with the Australian Labor Party to ensure that there is no transparency, no accountability and no openness. Undoubtedly, a side deal has been done and we will see later on, in the course of this parliament—some time next year, no doubt—as to what that side deal is and how the Labor dog is going to be wagged, especially by its newly found Green tail.

The minister clearly has to tell us whether that is an error on page 7 of the document. He also needs to tell us the time line. We move to page 8, where it says:

Once NBN Co’s Corporate Plan is approved by Government ...

So we are being asked to vote for this legislation to help assist NBN Co. get established and underway when the NBN’s corporate plan has still not been approved by the government. How can any senator who takes his or her responsibility seriously vote for this legislation, let alone vote to gag discussion of this legislation, when those fundamental and foundational documents, which should be available to us, have not been provided and which, as a result, are denying us the opportunity to make a rational, sound and considered decision?

I have reminded the Greens and I have reminded the crossbenchers, and I do so again: you know what happened when you went along with the Labor agenda in relation to pink batts, Building the Education Revolution and the Green Loans scheme. It seems those lessons have been lost on you. Those lessons have meant absolutely nothing. You mucked up with a $1 billion plan for pink batts, an eight-hundred-and-something-million-dollar plan for Green Loans, and the multi-multi-billion-dollar plan on Building the Education Revolution. That was only small fry. Let’s see if we can really muck it up with something big and make it worthwhile, like a $43,000 million plan.

Of course, there is no business plan before us. There is no corporate plan. There is no government response to the implementation study. There is no Greenhill Caliburn consideration of the business plan before us. None of those documents are before us. How could any person seeking to parade any scintilla of independence come into this chamber and give a blank cheque to the Australian Labor Party—given its past history of mismanagement—to deal with this issue in this manner? Any suggestion of independence, any suggestion of really considering this matter in detail, is completely and utterly thrown out the window—especially when you support the gag, especially when you seek to do everything to truncate debate on this fundamental infrastructure project for our nation.

Steve Fielding (Victoria, Family First Party) Share this | Link to this | Hansard source

These amendments do go to the heart of the bill, and I want to give my views on the heart of the bill. What sort of telecommunications infrastructure do we need for Australia in the 21st century? This question is really at the heart of this debate on the Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2010. This bill proposes two key issues in regard to our future telecommunications in Australia. The first key issue is to do with setting up fairer competition with regard to wholesale access. The second, and more controversial, issue is to do with giving the green light to setting up the National Broadband Network through authorising the Telstra and NBN Co. deal.

With respect to the first issue of setting up fairer competition for access, I can say that I fully support these measures. Under the present arrangements Telstra, through no fault of its own, enjoys a monopoly position with its wholesale network. This has meant that other telcos have been put at a clear disadvantage compared with Telstra when competing in the industry. It has in effect made Telstra the price setter when it comes to determining the price for accessing its network, and it is clear that the current arbitrate-negotiate model has stifled competition. This outcome is bad for competition and ultimately bad for consumers.

From the very beginning I made it clear that I did not necessarily oppose the structural or vertical separation. What I did object to was the way the government unfairly put the gun to Telstra’s head before Telstra had a chance to negotiate with NBN Co. I strongly objected to the government rushing ahead with the legislation before Telstra and the government had a chance to properly explore whether they could come to an agreement. I believe in a fair go, and what the government was trying to do was not a fair go. Clearly an agreement has been reached between Telstra and NBN Co. and now we can rightly consider this legislation. After close to a year of negotiations, Telstra and the government have finally nutted out an agreement and that has ensured that 1.4 million Telstra shareholders have also been given a fair go. Telstra will structurally separate but it will be duly compensated, and this is the fair thing to do. I make no apologies for holding up the legislation until Telstra and NBN Co. came to some agreement. Given this, I think it is important that the reforms to wholesale access be allowed to go through.

Before turning to the second and more contentious issue of the bill—the issue of giving a green light to setting up the National Broadband Network—I want to provide some reference to where I am coming from. When I finished high school, I decided to study electronics engineering. The reason I studied electronics engineering as a young man was that I could see that technology was a critical key to helping ordinary Australians have a better life and that we could all achieve more with greater efficiency. I still hold that view today. I strongly believe that technology, including telecommunications infrastructure, is a vital building block for any advanced economy that wants to remain competitive in a global market. I have also spent time working for a telco and have a good understanding of the industry and networks.

With that background, I will now turn to the key question: what sort of telecommunications infrastructure do we need for Australia? After considering the various discussions with telco experts, Telstra, NBN Co., government, opposition, competition experts and other interested parties, I have formed the following views. (1) Telecommunications infrastructure is critical to Australia’s future productivity and it is critical for Australia to remain competitive in the global marketplace. Superfast broadband is the future, and if we are to be at the forefront of the global community we need the speed and infrastructure to be there. (2) A fibre based wholesale network will always provide superior speeds no matter how much you speed up copper or wireless. There is no doubt that fibre is the best way to improve our network speeds, as the technology has unlimited potential. (3) All Australians deserve access to superfast broadband. This means that small business will have the same access speeds as big business, which will give small business a fighting chance to compete in a growing, globalised market.

The final view that I formed is: if you continue to let the commercial business market drive access investment decisions, we will continue to see many people missing out on superfast broadband, and this will only get worse in an increasingly competitive market.

With regard to the issue of the business plan, I know that some will argue that we should wait until everyone has seen the business plan for the NBN before debating this bill. Also, there have been calls for the Productivity Commission to undertake a cost-benefit analysis. But the reality is that a business plan or a cost-benefit analysis will not change the fact that Australia needs to have telecommunications infrastructure that provides access to superfast broadband for all. What is more, any cost-benefit analysis undertaken will also be subject to counterclaims that it is riddled with uncertainties, and we will just end up going around in political circles.

In addition, how do you value the benefits of a superfast broadband network when many of the innovations that it will spur on do not yet exist? This is the reason it is difficult to quantify the full economic and social benefits of the NBN, because it is indeed transformative technology. To give just a small, simple example of this fact, let us look at the iPhone. When Apple invented the iPhone they thought it was a winner, but I doubt even they could have imagined the industries which would be created or the number of applications which would develop from it. Just look at how the iPhone has transformed the way we go about our personal and business lives. There are now entire new enterprises and technological solutions which exist solely because of the iPhone.

For the same reason, it is hard to imagine what the future will hold if Australia develops a ubiquitous superfast broadband network. For example, think how education could change as a result of having superfast broadband for all. Imagine if the government decided to offer free university with every broadband connection. Family First believes that a free online university could offer free degrees to all Australians. A free online university would make that easier and more affordable for many more Australians. This would be a real education revolution for the Australian people. Being able to do university from home at your own convenience, without a huge HECS debt, would also create enormous opportunities for mothers staying at home to look after the kids. It would also benefit people who want a career change but do not want to be burdened with a huge, midlife debt. This is the kind of innovation that can come from superfast broadband across Australia. It is a simple idea that would be transformative and help us continue to be a clever nation.

Another example to think about is how medical service delivery can change as a result of having superfast broadband for all. No matter where you live, whether in regional or suburban areas, medical service delivery can be right there. There will be no necessity for you to travel for hours and hours just to get medical services. You will be able to do that over the network, without leaving home.

I believe the upsides for Australia in developing a ubiquitous superfast broadband network are tremendous. This is a very subjective statement, I know. All I can say is that, given my background as an electronic engineer, I do believe superfast broadband for all is transformative technology and is the basic building block for Australia to remain competitive in the 21st century. Given these upsides and given that taxpayers’ money of around $27 billion will be fully repaid and the government will end up owning a public monopoly asset called the NBN Co., which will have net worth in the tens of billions, I can see no reason for me not to support the government’s National Broadband Network. I believe that fibre to the home and to all premises is the best way forward for Australia, and this legislation will give effect to that initiative. Because of this, I will be supporting the government’s bill and also supporting the amendments before the chair.

Barnaby Joyce (Queensland, National Party, Leader of The Nationals in the Senate) Share this | Link to 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.

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

I wanted to indicate the government’s support for amendments (1) and (2). The government supports these amendments. These amendments propose that the objects set out in 3(1) of the Telecommunications Act 1997 be expanded to include availability of accessible and affordable carriage services that enhance the welfare of Australians. The inclusion of this objective will make clearer the importance the parliament places on the provision of accessible and affordable telecommunications which promote the welfare of Australians. It will enable specific economic welfare principles to be more easily and openly weighed against the other objects in the act, such as efficiency and international competitiveness. The amendment clarifies that affordability and accessibility of carriage services are important factors when considering long-term interests of end users.

Michael Ronaldson (Victoria, Liberal Party, Shadow Minister for Veterans' Affairs) Share this | Link to this | Hansard source

I want to make a number of comments today. I want to put to bed some commentary from the minister both on Lateline last night and in the media again today in relation to the debate on this bill. There is some extraordinary notion that this has been 12 months of—

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

A filibuster!

Michael Ronaldson (Victoria, Liberal Party, Shadow Minister for Veterans' Affairs) Share this | Link to this | Hansard source

a filibuster from us, thank you for the interjection. But what complete and utter rubbish and what a filibuster that is! The minister has been quite duplicitous in making that claim because this bill was introduced on 15 September 2009, but the key issue is that it was introduced prior to the deal with Telstra, which happened in the middle of this year, from recollection. And on 20 October a very different bill was introduced into the House, a very different bill indeed, which took into account those quite dramatic changes that followed on from the deal with Telstra. A completely different bill post the Telstra deal. It was introduced into the Senate on 17 November, so effectively this chamber will have five to six days to debate probably the greatest spend in this country’s history. And today we have had the quite remarkable scene of the protectors of democracy—the Greens, aided and abetted by the two Independents, of whom I thought a lot more—making sure that this parliament, this Senate, is not debating matters this morning.

Prime Minister Gillard must be terribly, terribly proud of that. This is the openness and transparency—is this the new Julia? The new Julia has done a grubby deal with the Greens, walking now hand in hand to make sure that you, Minister, and your party are being removed as the party of the workers to a party that now is fully rusted on to the Greens philosophical view of life. When you leave this place and that is the legacy you have left, then I do not think you will be doing it with any pride at all because I know what your personal philosophical views are and they are so far removed from the Australian Greens. But you and your colleagues on the right of the Australian Labor Party have been prepared to sign up to a grubby deal with a grubby political party which does not represent in any way the views of average Australians. So no more, please, of this ‘12-month filibustering’; you know as well as I do that this is an entirely different bill.

I refer to press commentary today, particularly from Terry McCrann, who I think everyone would agree is a respected economic commentator. The by-line says ‘NBN “case” nonsense’:

It might have been one small step for independent senator Nick Xenophon. It proved to be one gigantic leap—backwards—for the rest of us.

The 36-page so-called “NBN Co Business Case Summary” was a complete joke. If it’s at all an accurate indicator of what’s in the “full” Business Case, NBN Co CEO Mike Quigley and his irresponsible minister Stephen Conroy should both be sacked.

I will not go on with the rest of the article. As the shadow minister, Mr Wentworth, from the other place made quite clear on the AM program this morning:

Well it’s a very inadequate document. It doesn’t have any financial statements, it doesn’t have a profit and loss, it doesn’t have a balance sheet, it doesn’t have any cash flow statements, it really isn’t an adequate basis on which to make a $43 billion decision.

The government’s recklessness is extraordinary. The Prime Minister has not read the full business plan. The Treasurer has not read the full business plan. It apparently has not gone to the cabinet.

I ask the minister while we are in committee: have you read the full business plan? The minister will not acknowledge whether he has or has not read the full business plan. From that I take it that the minister has not read the full business plan, because surely if he had he would have said so. So here we have a minister who is signing up to nearly $50 billion of taxpayers’ expenditure, who has not himself read the business case. It is extraordinary. And this government stands utterly condemned for signing up the Australian taxpayer to nearly $50 billion—and I suspect it will be closer to $70 billion or $80 billion by the time we finish. Indeed, if you look at commentary from the Alliance for Affordable Broadband, who I understand have written a letter to Mike Quigley today—and if you go through at some length the letter, which I will seek to table at the end of my contribution—the matters raised in this letter should fill every one of us with complete and utter horror. The horror expressed today by Terry McCrann is replicated by others.

I want to ask a number of questions of the minister. Is it correct that the Telstra cost is now at some $13.8 billion? The minister is refusing to answer any questions from the opposition members while he is fiddling with his BlackBerry. That is fine. I will just ask them and others will judge the minister’s inability or failure to answer questions. What is the actual cost of the Telstra payment? Originally the statements indicated, I think, that there were two amounts: $9 billion plus $2 billion, making $11 billion. This report now says it is $13.8 billion. There was also a report in one of the newspapers back in August which said the full payment from the NBN was $16 billion on a pre-tax basis. So, Minister, what are the true figures before and after tax? Are you able to say whether Telstra, for example, will have a capital gains tax bill as a result of this payment? Indeed, the last paragraph on page 30 of this extraordinary document, as it was quite rightly called by Senator Joyce—this remarkable document which says nothing, which Terry McCrann says is a ‘pure nonsense’ and a complete and utter joke—talks about, as Senator Joyce may have raised briefly, how the NBN will start paying cash dividends in 2020 and, allegedly, will repay the government’s entire investment by 2034. Minister, is the NBN paying interest to the government? I think you could probably assist me by saying yes or no to whether they are. If they are then I will not have to proceed with the rest of my questions. If they are not then I will. So are they paying interest or not?

Russell Trood (Queensland, Liberal Party) Share this | Link to this | Hansard source

I think the progress of the debate would be facilitated if you were to ask your questions and let the minister answer at the end of your contribution.

Michael Ronaldson (Victoria, Liberal Party, Shadow Minister for Veterans' Affairs) Share this | Link to this | Hansard source

Thank you, Mr Temporary Chairman. I again ask for indication from the minister about whether interest was being paid. Then I can make a decision about whether I continue with the questions. But if the minister is not prepared to do that and I have to take another five minutes to answer the question, do not come back to me with any talk about filibustering. If they are not paying cash interest, is an amount being capitalised? Is that going to be included in the total funds contributed by the government or is it, effectively, an interest-free loan? I presume the minister will answer that question when I have finished my contribution or the others have finished their contributions. Minister, are you going to table the terms of the lease which Senator Joyce referred to? What are the terms of the lease? Where is that cost included? Are you going to release the details of those leases?

I mean, this is just absolutely full of holes. In answer to the question raised by Senator Fielding about whether we need a state-of-the-art network, I will quote pieces from an editorial in the Australian the other day:

The unseemly rush to a National Broadband Network says more about the government’s political problems than about adding to national value.

               …            …            …

Labor appears willing to do anything to get the $43 billion network up …

Australians deserve more open discussion on the NBN …

               …            …            …

The NBN is a Rolls-Royce answer to communication needs when a Holden might do just as well.

Who is probably best able to make that sort of assessment? Maybe the Productivity Commission might be a body that can make that sort of judgment and give the government and the parliament some indication about the integrity of what we have been asked to vote on in the next 24 hours.

So why will this government not acknowledge that the Productivity Commission should be involved? Its case was weakened dramatically with the remarkable revelation some 36 hours ago that Greenhill Caliburn are doing a review of the robustness of the 30-year business plan and the company’s corporate plan. If the government itself required Greenhill Caliburn to come in and cross-check the comments and the NBN business case, if they were required to do that, that is an acknowledgement on the part of the government that all is not well with this. The fact that it has called them in to run their finger over this means that the government acknowledges that all is not well. So why not let the Productivity Commission do it properly? Minister, why not let the Productivity Commission, who have all the resources, do an inquiry into this and see what they come back with? If we are proved wrong after the Productivity Commission has reported then we will be proved wrong. But at the moment you are not allowing this parliament to make a proper judgment about a $50 billion noose that you are hanging around the necks of not just this generation—

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

Senator Conroy interjecting—

Michael Ronaldson (Victoria, Liberal Party, Shadow Minister for Veterans' Affairs) Share this | Link to this | Hansard source

So you think it might be 70. The minister said it might be $70 billion. I think that is probably closer to it, and I am glad we have got an acknowledgement that that is a possibility.

Let us get this off to the Productivity Commission. The opposition is happy to be proved wrong if the Productivity Commission comes back and says, ‘This business case stacks up.’ I will be the first one to stand up in this place and say that my nervousness and the nervousness of the business community, the banking community and everyone else was wrong. I will be happy to admit it if we are wrong. But I tell you what, we are not going to let you get away with expenditure of this nature on the back of a 36-page summary of a business case, which, as Senator Joyce said, said absolutely nothing at all. If you think it is appropriate to spend that amount of money and sign not just this generation but generation after generation up to this sort of expenditure then it is a gross abrogation of your responsibilities as a minister and a gross abrogation of the responsibilities of the Prime Minister to this country.

Get it off to the Productivity Commission and let the Productivity Commission make a value judgment about it. Then come back into this chamber and tell us what they said about it. Why you are afraid, Minister, and why Prime Minister Gillard is afraid to put this to the ultimate test is because it is about politics and the pull-through that the Prime Minister got last night from your colleagues, Minister—some 20, apparently, who spoke on this—when they said to her, ‘You do not have a program for this government and you have lost your way.’ These were your own colleagues telling the Prime Minister, and there is no indication to date that anything is going to change.

This is a political fix. This not a broadband fix; this is a political fix. And the fact that you have dragged the two Independents into this political fix is one of the most disappointing aspects. I have great regard for both of them but, quite frankly, I think they have been conned by you, your government and the Prime Minister into supporting this dramatic expenditure of taxpayers’ funds. (Time expired)

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

We are focusing on the objects of the legislation. In particular, Senator Ludlam was earlier talking about the objects of it, and I would like to focus on a very important object. One of the amendments proposed is the availability of accessible and affordable carriage services that enhance the welfare of Australians. I would like to pick up on that point because my biggest concern is the cost the average Australian is going to have to bear as a consequence of what is now turning out to be another debacle of this government. It really has become a very, very sorry mess.

We now have the government finally, under duress, releasing this 36-page summary, but in the end this is really just fuzzy words. Where are the financial statements? Where is the business plan? Where are the cash flow statements? Where is the profit and loss statement? All of this seems to be totally out of context. If anybody in this country—and I look at the people in gallery and ask them—wants to set up a business tomorrow and they want to go to the bank for money from the bank to set up that business, what is the first thing that the bank manager is going to ask? The bank manager is going to say, ‘Well, that’s all very well. That might be a great idea, but where is your business plan? Where is the money coming from? Where is the security? What is your profit and loss? What are your assumptions? Are your assumptions appropriate for what you want to do?’

If you do not have that business plan, you are not going to go anywhere. But here we have this government proposing to spend $43 billion—actually, it is not $43 billion; I correct myself. There is the odd figure in the document I have here, and if I have a look at page 29 of this document we are told that by the time you add it all up we are talking about $49.5 billion. So we are talking about almost $50 billion that the taxpayers of Australia are going to have to underwrite for what is a monopoly in this country and there is no business plan to spend this money—my money, your money, the money of your children and your children’s children—because by the time the $49 billion is paid off it will be your children and your grandchildren who are going to have to foot the bill for this.

The government talks about affordable broadband so that everyone can get broadband, but the question how we are actually going to get there was never really asked. That was the question that should properly have been asked of the Productivity Commission, which is best equipped to give the answer—that is, how are we going to have universal and affordable broadband so that everyone can get broadband with high speeds at a price they can afford to pay? When Senator Ludlam talks about accessible and affordable broadband, that is the question that the Productivity Commission should have been asking. The Productivity Commission should have been given the opportunity to ask that question and make an analysis so that the taxpayers of Australia could have had the appropriate answers before this Senate is called upon to vote on this legislation.

But of course millions of households, at a cost of billions of dollars, are effectively going to have their existing fixed-line telecommunications ripped out and made redundant, and they will end up getting a service which, quite frankly, is no better than what they had. I would like to focus on this, because I would like to know—and I would like to know it from the minister—what assurances consumers have that this monopoly situation is not going to do what Telstra did this week to one consumer, namely me; that is, switch off broadband at my home. Minister, are you listening to this? This week broadband at my home got switched off. I do not want to cast aspersions, Minister.

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

Guilty as charged.

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

It might well be that Minister Conroy has decided that he is responsible for switching off broadband. What happens? All this week I have been struggling to try to reconnect broadband to my home. What assurances do the consumers of Australia have in a monopoly situation that somebody is not going to come along one day and decide to just—

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

It is a monopoly fixed line.

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

We are supposed to have competition now, let alone if we have a monopoly situation. What assurances do I have, Minister, that that is not going to happen again? Out of the blue this happened, and it has taken me five or six days to try to resolve this issue. What assurances will we have, and where are these assurances in this document that consumers will have proper access to broadband, because quite frankly it is really not evident at the moment.

Labor started this whole debate on $43 billion but now, from the few words that have been released to Senator Xenophon, it is $49.5 billion. How do we know that that is the end figure? How do we know that it is not going to be $60 billion or $70 billion? If we had a proper business plan and the assumptions were tested, perhaps we might be in a far better position to ascertain that. We hear all these numbers that are flying past. I take you back to the point I made earlier in relation to any business that wants to launch a product or do something and goes to their bank manager. The business plan they present would put whatever they want to do in a favourable light. Minister, if this is such a great thing why don’t you release all the documents so that at least we can see whether those 400 pages—a lot better than what you have given us—actually try to put this in a much more positive light? I think it would be better if the public were able to access that.

Let us look at the situation. We have had years and years of microeconomic reform. We talk about getting governments out of business, we talk about ensuring competition and we talk about making sure that there has been competition out there in the telecommunications sector. What we are now establishing is a new government-owned monopoly. We are using the powers of this parliament to prevent other companies and the private sector from competing with this monopoly. It is obvious, Minister Conroy, that you have been dealing with Minister Carr for too long, because you have been infused with his rather extreme left-wing, noncompetition tendencies. You have been spending far too much time with him. We have worked hard over the years to ensure that we had competition in the telecommunications industry and suddenly this minister is going to reverse—

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

You went without broadband for five days and that’s competition?

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

No, I am talking about the bigger picture. I am talking about assurances. You talk about all the benefits of e-health and this and that. If you are going to have circumstances where consumers cannot have assurances about even day-to-day matters, then you have got problems now let alone in a circumstance where you have got a monopoly situation. Things will be far worse. Consumers will not have the confidence. Why would a monopoly care? I expect you to personally go in and investigate this matter. I expect that you will provide an answer because it is not just about—

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

I hear you have moved into the Kiama Downs area so you could get broadband.

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

I have not. In fact, you have sold the people in the Kiama Downs area a pup.

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

I hear you moved in there.

Concetta Fierravanti-Wells (NSW, Liberal Party, Shadow Minister for Ageing) Share this | Link to this | Hansard source

No, I do not live at Kiama Downs. You come in here and talk about broadband, you talk about Kiama Downs and about other areas, but what it ultimately will come down to, Minister, is whether the taxpayers of Australia will get the accessible and affordable broadband that they deserve. How do we know? Quite frankly, your plan has not been put under proper scrutiny. The Australian taxpayers are going to have to fund this. Ultimately, if NBN Co. has financial problems it is going to be the Commonwealth of Australia and the taxpayers of Australia that are going to have to foot the bill.

People out there are now starting to understand that this really is a pup because, ultimately, it is not just $43 billion, not just $49 billion but a whole lot more billions of dollars. You mismanaged the pink batts and the school halls. Everything you have done you have mismanaged. This will be your legacy. In fact, it will be the most mismanaged program ever by a government. It will have your name on the epitaph, and that is exactly what is going to happen.

You are taking competition out of the market and you are selling the Australian public down the gurgler. You are inflicting on the Australian public a tax burden that you cannot even put your finger on. Weeks ago it was $43 billion and now it is $49 billion. You cannot even get your facts right. Why? Quite frankly, Minister, you do not know what you are doing. If you were so confident about how great this plan was, you would have put it out for much more public scrutiny. What are you afraid of?

You send off all sorts of things to the Productivity Commission. You have shunted off aged care to the Productivity Commission. You have not done anything about aged care, even though you said there are millions of Australians that are waiting. You shunted that off to the Productivity Commission because, even though you have had review upon review, you said you need a proper assessment of what is needed in aged care. What about this? This is almost $50 billion worth of spending and you are not going to send this off to the Productivity Commission. You are prepared to do other things that deserve scrutiny. Surely, what is going to be one of the largest infrastructure investments in this country deserves much more scrutiny. I appeal to the taxpayers of Australia to understand precisely what it is you are being sold, and it is a real pup.

Sue Boyce (Queensland, Liberal Party) Share this | Link to this | Hansard source

I rise to follow on from the comments made by my colleagues, particularly Senator Ronaldson and Senator Fierravanti-Wells, on the Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2010. Senator Ronaldson made the point that this legislation has not been before this parliament for the length of time that the government, particularly the Minister for Broadband, Communications and the Digital Economy, Senator Conroy, would have you believe. It is a very new piece of legislation. The amendments also are new. I commend Senator Ludlam for his attempt at an amendment that assists somewhat in trying to put some fairness and some equity into the system. Unfortunately, it is still a black hole.

Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

Will you be supporting the amendment?

Sue Boyce (Queensland, Liberal Party) Share this | Link to this | Hansard source

I will not be supporting the amendment because I do not support the bill, Senator Ludlam. The availability of accessible and affordable carriage services that enhance the welfare of Australians would certainly be something that the coalition would support. As an object, we would support that. However, I do not believe that we have any more evidence than we had earlier this week to suggest that this piece of legislation will go anywhere at all towards providing that.

I was interested to hear Senator Xenophon say on television last night that he was persuaded by the intervention of the Prime Minister into this case. It is a shame Minister Conroy was not able to carry through his own legislation, which apparently he has such a passion for but which he does not want to share with anybody else. The intervention of Prime Minister Gillard by getting out her itsy-bitsy business plan and showing it to Senator Xenophon apparently was enough to sway Senator Xenophon towards the government’s view. It has not swayed the coalition and it will not sway the coalition. Nor has it swayed vast numbers of the public.

We can see, and it has been commented on, that this summary is very light on—it was referred to as being ‘number light’. Not only is it light on, it is clear that it was put out in such a hurry that it is full of language errors. In the third paragraph—you think they would have got around to checking the third paragraph, wouldn’t you?—it talks about:

… providing more information without comprising the market sensitive aspects of the Business Case …

I think they meant ‘compromising’, but we should know that ‘compromise’ and ‘negotiation’ are not words that this government understand. What we have before us is not an analysis of the costs or an analysis of the benefits.

I note that Greens amendment (2) talks about ‘services that enhance the welfare of Australians’. Yet, if we look through the itsy-bitsy business plan, we see it says nothing on that topic, nothing at all. There are all sorts of comments about assumed usage and assumed speeds, but it does not tell us a thing about what NBN Co. perceive to be the welfare of Australians. There is nothing in here at all about that. It goes on and on about rates of return, which will be a complete shemozzle for them and, in my view, unachievable. It talks about ‘points of interconnect’, which is not yet an achieved deal—and, if that deal is not achieved, this whole business plan is likely to simply collapse. But there is nothing at all about welfare in the summary. In fact, it makes the point, which I found somewhat bizarre:

Telstra will become NBN Co’s largest suppliers of infrastructure and is likely to become NBN Co’s largest customer—

its largest supplier and largest customer. The ACCC might have liked to look at that! The Productivity Commission, I am sure, would have had a view on that sort of material.

When we look at the comments and the number of assumptions they have made about growths in speed and demand and therefore revenue, we find nothing at all, except that they have used projections based on what is happening now and what they hope will happen. They hope that there will be 10.9 million premises in financial year 10 using the new service, and that would be, they hope, 9.6 million residential premises and 1.3 million business premises. They are basing the growth rates, in part, on an average growth of 177,000 new premises every year up to 2025.

Well, we have news for you: building approval rates, particularly in the residential area, have been falling disastrously under this government, and nothing is being done to fix them. So why wouldn’t we expect that to be in the figures? We have no idea what they are talking about, but they go on and on. Their only concern about the future, about what might affect their projections, is that there could be a ‘saturation of usage, slowing growth in online hours and increasing delivery of content on multicast applications’. That is all they can tell us there. They can tell us nothing about genuine welfare, about what this will do for regional Australia or any other aspect of Australian life.

The summary says that fibre to the home is the next generation of technology. Now, the only sure thing is that within the next 30 years there will be several more ‘next generations’ of technology. But have they assumed anything there? Other than under their risk management profile, they do not talk about how they would deal with that or anything else.

Another aspect of Greens amendment (2) is ‘affordable’ carriage services, which is possibly dealt with at greater length than almost anything else in the itsy-bitsy business plan—except, of course, that we do not get any figures. There are no figures. NBN Co. tell us:

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.

Sorry, but different speed tiers and connectivity capacity usage are very, very strongly related to the price, which they sort of cover in this itsy-bitsy business plan. It goes on to say:

… NBN Co. anticipates being able to reduce real prices for all products and nominal prices for all products, except the basic service offering, while maintaining an internal rate of return above the Government long-term bond rate.

The issue here is that the access to 12 megabits or more per second that NBN are apparently going to offer as their basic service will be the service that most Australians will want to take up. So once again we are back to the fact that, if you want the one with the bells and whistles, you will get a good price; but, if you want the average that this project would offer, you have no guarantee whatsoever about what will happen to prices. The prices will just continue to rise because there is no guarantee at all that real prices will be contained—not in this excuse for a business plan.

The NBN internal rate of return is, again, an interesting effort. They have used a number of assumptions to get to it. But, as they point out, other remaining government decisions could have an impact on that—but, gee, they’ll just have to wait. They are looking at their stocks, the building of new premises and speeds, but nowhere do they look at what might happen over the next 30 years in terms of people’s usage of products that are delivered via fibre to the home. Certainly, a saturation point will be reached, but there is no detail about why they are so confident that this will not be a major issue for them—yet it is something that has been raised over and over again by commentators.

In an article in the Age today there is a view that there is sleight of hand on the figures they use, that it is very clever to have moved Telstra’s expenditure of $13.8 billion to the operating expenses as though that is something that the government will not have to fund. How much are the government going to have to pay over the next few years to get NBN Co. operational? According to their latest figures, it will require $35.7 billion in capex and another $13.8 billion in operating expenses to do the deal that they had to do with Telstra and which is covered in this legislation, of which there has been almost no scrutiny up until now. I am sorry: if you add 35.7 and 13.8 you get to 49.5—that is, $50 billion. If they can explain to me how these expenses will not have to be met by the Australian taxpayer over the next few years, I would love to hear it. But, of course, that is not covered in any way, shape or form in the itsy-bitsy business plan.

The other point made in a column in the Age today is that the government claim that they will have a long-term weighted cost of capital of between 10 and 11 per cent; yet there is nothing here to suggest how on earth they intend to achieve that or how they could possibly hope, in the climate that they have not explained and that we all know is moving all the time, to keep to a long-term cost of capital of 10 per cent to 11 per cent. In fact, Malcolm Maiden in the Age wrote:

However it is configured the project is going to struggle to meet its own long-term weighted cost of capital …

We already have respected people making the point that there is a strong possibility that NBN will be a white elephant. But the government do not want anyone to talk about that. They do not want it discussed, they do not want it ventilated and they do not want to look at it properly. If they could get out such an itsy-bitsy little business plan in an attempt to win support for this legislation, why could they not have put out the real business plan, the 400-page business plan, with commercially sensitive information simply blacked out? They have had weeks and weeks to do that and have chosen not to. There is absolutely nothing in anything that the government have told us so far that gives me any confidence that what we are looking at are accessible and affordable carriage services that will enhance the genuine welfare of Australians.

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

I rise to speak to Greens amendment (1) to the Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2010 and, in particular, the clause that ‘the availability of accessible and affordable carriage services that enhance the welfare of Australians’ be added to the object of the legislation. Before any National Broadband Network can deliver accessible and affordable carriage services and broadband, the Australian people deserve some reassurance that those carriage services will be subject to some transparency and accountability in the process of the build and, in particular, in the passage of the legislation to enable the ultimate build. As the opposition has said repeatedly in this place and the other place, transparency and accountability are conspicuous in their absence. That is an understatement when considering the National Broadband Network.

The government has attempted, thus far successfully, to curry favour with the Independents in the lower house and my Independent colleagues in the Senate. With respect to my Independent colleagues in the Senate, in my view they have curried that favour with a couple of sops. I regret that I think these sops, given the fullness of time, my Independent colleagues in the Senate may live to regret. They may live to rue the day that they signed off on the bottom line they voted on, be that today or as long as it takes for the chamber to deal with this legislation. They may rue the day that they signed off on the bottom line on the basis of those sops offered by government. The lead-in to the sops was the rejection, as I understand it, by the other place of the member for Wentworth’s motion to establish a joint parliamentary committee to inquire into the National Broadband Network. The joint parliamentary committee proposed by member for Wentworth could have commenced work tomorrow. He proposed that it be equally laden with government members and opposition members and that it have, in addition to those parliamentary members, independent representation, as is appropriate.

I will go in a moment to the second of the two sops offered to and accepted by the Independent senators—that is, the government’s proposition that there be established a joint parliamentary committee, and contrast that with what would and could have been the member for Wentworth’s proposal for a joint parliamentary committee to properly and impartially assess the ongoing rollout of the National Broadband Network. I will also take the liberty of contrasting it with what could have been—had the government not so thwarted business in the Senate today—Senate consideration of what was on the Notice Paper, namely a joint motion by Senator Ludlam and me to refer the ongoing rollout of the National Broadband Network to the Senate Standing Committee on Environment and Communications for ongoing inquiry. The sop of a government proposed joint parliamentary committee is a very sorry sop when contrasted with what could have been the member for Wentworth’s proposed joint parliamentary committee and what could have been Senate consideration of a proposal that the Senate environment and communications committee consider the National Broadband Network on an ongoing basis.

First of all I want to go to the supposed business case and the business case summary—the summary, the sop—which has been accepted by the Independents and about which my colleagues have spoken at some length. I have a couple of observations in respect of that summary. The first one arises from a letter sent today from the Alliance for Affordable Broadband, an open letter to Mike Quigley, CEO of NBN Co. I know some of my colleagues, in particular Senator Ronaldson, have referred to this letter already today. That alliance, which from our experience in ongoing Senate committee inquiries comprises some nine to 10 highly respected and totally senior operators in the broadband sector, says that they have had a look at the business case summary released yesterday. It says, ‘We have some immediate take-outs and several questions, Mr Quigley, which we hope you can answer.’

They say that the summary appears to raise more questions than it answers. They say that in their view the summary shows that the costs are actually higher than they are expected to be. The price of the basic package will not decrease over time and will likely increase. The project is only viable if it is a monopoly in the last mile and in backhaul, facing no competitive pressure as to price or innovation or efficiency. The letter goes on to say ‘We still do not have fundamental information and facts to support the government’s assertion about the business case. We do not have much confidence that the rest of the business case that has not been released will provide any of this information or facts.’ The best bit—the most tragic bit—is their assessment that no investor or lender would lend money to open a milk bar based on a document with this little detail.

Interestingly, there is enough that is entirely consistent with the observations made by the member for Wentworth yesterday on his blog about the 36-page summary—the summary sop—accepted by the Independents. The member for Wentworth said on his blog:

… beyond a few scraps of information and other warm words this is a thoroughly inadequate document. It is a sop thrown to the independent Senators in the hope that they will give the Government their vote. Real accountability, real transparency requires a thorough and complete business case, not 36 pages of reassurance devoid of financial detail.

We have this 36-page sop, this 36-page apology for a 400-page business case which the minister will not even fess up to reading because most likely he has not. He will also not fess up to reading the supposed ACTU agreed enterprise bargaining principles upon which he bases his reassurance that there will be no wages blow-out in the build of the NBN. He fails to give that reassurance that he has read it because again most likely he has not. Indeed until we see that document, we do not even know whether it exists other than on the minister’s own say-so. So the minister offers a 36-page sop for a 400-page document which he will not even fess up to reading. Do you know that in this 36-page sop, which is supposed to describe the financial underpinnings of the business case, the 400-page document, you have to get to page 28 of those 36 pages before you see a frigging dollar sign for a $43 billion infrastructure investment? The government has bought off the Independents with a 36-page sop. You have to get to page 28 of those 36—that is, seven-ninths of the document—before you see a jolly dollar sign. Cheap, cheap, cheap—not.

Leaving the business case summary sop, let us go to Senator Xenophon’s agreement with the government and in particular Senator Xenophon’s reference to the government’s agreement to an:

… ongoing oversight of the NBN roll-out by a new Joint Parliamentary Committee, chaired by a Lower House Independent—

I am reading from Senator Nick Xenophon’s press release. He goes on:

to report every six months during the rollout of the NBN … Every member and senator will have the right to participate.

I have been provided with a copy of the Prime Minister’s letter of 23 November to Senator Xenophon. It says:

I am writing after our discussions yesterday to confirm the package of measures that we have agreed with you to facilitate the package through parliament of the consumer safeguards bill.

I am going to refer to the paragraph in that letter where the Prime Minister discusses this joint parliamentary committee. She says:

First the government agrees that there is a valuable and ongoing role for parliamentary scrutiny to properly scrutinise the implementation of policies. With this in mind and in the interests of accountability and transparency—

Thank you very much—

the government will move to establish a joint committee on the National Broadband Network to provide progress reports every six months. The composition of this committee will mirror the Joint Committee of Public Accounts and Audit.

Of course, if you have a look at the Joint Committee of Public Accounts and Audit, you will see that that is a wholly government dominated committee. It has 16 members—10 from the House of Representatives and six senators. Nine of those members are government, six are opposition and one is Independent. The committee is also—which should concern members in this place—dominated by House of Representatives members. What a cheap sop—in particular to the Independents. So it is a committee that is very clearly government dominated and House of Representatives dominated.

Prime Minister Gillard then goes on to say in her letter:

The Joint Committee on the National Broadband Network will report on rollout progress, report against the final business plan, assess risk management processes and look at other matters the committee determines are relevant to its deliberations.

What do you reckon they might be from a government dominated committee? Do you reckon that a government dominated committee would agree to look at things that were the subject of Senator Ludlam’s and my joint motion to refer the NBN on an ongoing basis to a Senate inquiry? Do you reckon a government dominated committee will agree to look at the cost of establishing and operating the NBN and the impact of the project on government finances? Do you reckon a government dominated committee will look at the impact on competition in the telecommunications market? Do you reckon a government dominated committee will look at alternative or emerging telecommunications technologies and the degree to which the NBN will be future proof—a point referred to by the alliance in their letter to Mr Quigley? Do you reckon a government dominated committee will look at any practical issues likely to arise during construction of the NBN, including workforce—well, Senator Conroy will not—property access and property connection issues and aerial versus underground construction? Do you reckon a government dominated committee will look at experience gained at, and principles or lessons extracted from, current release sites including cost, pricing and performance? Do you reckon a government dominated committee will look at documents, information and advice provided to the government but not made public? I hardly think so.

Even better, the Prime Minister says to Senator Xenophon that this joint parliamentary committee will not start its work until July next year. What about the taxpayers’ money to be expended up until then? This parliamentary committee will not start its job until 1 July next year. Until then its work is supposed to be done in this way—maybe:

The committee will draw on any relevant material from the Standing Committee on Infrastructure and Communications, due to report back by August 2011.

Again, have a look at the membership of that standing committee: four government, three opposition and one non-aligned member. It is government dominated and House of Representatives dominated. It is a do-nothing committee, other than what is favourable to the government.

But the best bit about the Prime Minister’s letter to Senator Xenophon, sealing the sop and sealing the deal, is:

The committee would be able to call witnesses including MPs and senators about the performance of the NBN or any other matters of local interest.

This joint parliamentary committee will become a politicians’ plaything—and a government dominated politicians’ plaything at that. How interesting it is to contrast that proposition with the repeated refusal by ministers of this government to accept repeated invitations to front the Senate Environment and Communications References Committee on the inquiry into the botched, bungled and tragic Home Insulation Program. The Prime Minister refused when Deputy Prime Minister; then Prime Minister Rudd refused; Senator Arbib refused; Minister Combet refused; and Environment Minister Garrett—as he then was—refused. Contrast that with the hypocrisy of this Prime Minister now offering a politicians’ plaything. It is a disgrace.

David Johnston (WA, Liberal Party, Shadow Minister for Defence) Share this | Link to this | Hansard source

I want to deal with some of these amendments that Senator Ludlam has put forward. I note that they are all very constricting on the powers of the minister and quite prescriptive in what they want the minister to do in dealing with this legislation. I say to Senator Ludlam—and indeed to you, Chair—that I share his concerns, and I take the time to compliment him on quite a considerable amount of work in just this one amendment. It is very clear to me that he has some grave concerns as to how this will play out, both from the perspective of accountability and from the perspective of providing a reliable and proper service to people.

The government, in answer to the very large number of amendments, lies like a dog in the manger with respect to providing transparency and openness on this particular project and this particular legislative framework. The question is: what is the problem? I have a number of questions for the minister which I hope that he will answer in this debate as to these amendments. Why is he so secretive? If this is such a robust plan, as he suggests Australians should believe it is, why has he been dragged kicking and screaming to this point in time to release any real information about the project?

The other point I should make is that the government are quite concerned that the opposition is not going with them. I want to say that, quite rightly, the opposition has an enormous number of grave reservations about the administrative and governance capacity of the individual ministers of the government. They impart absolutely no confidence whatsoever in any of the undertakings that they have carried out whilst in their present ministerial positions. The minerals resource rent tax has from its inception been an absolute laughing stock and fiasco. Climate change has been simply a running sore of a disaster. The most deficient department and the most defective minister in the government have of course been the former climate change minister and the department with no legislation, something straight out of Yes Minister. There is the current health debacle across Australia—seeking 30 per cent of, in particular, Western Australia’s GST. Asylum seekers and their positioning around Australia, and the protection of Australian coastal borders, has been an absolute fiasco. There is the issue of water in the Murray-Darling and, of course, pink batts. On the pink batts issue, this parliament—and, indeed, probably Australia since Federation—has never seen such a tragic outcome as the four dead people and the hundreds of house fires that that purely ministerial maladministration has delivered. Of course, lastly there is the issue of school halls. The question is: why would the opposition, in the face of all that, be so reluctant to go down the path of a $50 billion expenditure by these ministers? Why would we be reluctant? The simple answer is: because—

Progress reported.