Mr HATTON (12:19 PM) —This is a bill of betrayal. It betrays the Australian community and its future telecommunications needs, and it betrays the fundamental core responsibility that a national government has had for telecommunications in this country under the banner of post and telegraphs since 1901. It is a national responsibility of a national government to provide the fundamental network infrastructure for Australia’s telecommunications. This government, elected in 1996, commissioned a national commission of audit which came to the conclusion, under the government’s instructions, that the government should not provide a single direct service to an individual Australian—that the government should merely benchmark and audit.

The Telecommunications Legislation Amendment (Future Proofing and Other Measures) Bill 2005 and cognate bills are the final expression of what the government is all about. This legislation is not about national government. It is about a betrayal of its fundamental responsibilities. It is about walking away from what the government should be doing and consigning itself simply to being an auditor—a somewhat interested auditor but an auditor and no more. That is a betrayal of every Australian who is dependent on government to provide essential services. But it is a betrayal based on a fundamental philosophical approach that the business of government is to be out of the business of government. That is essentially what the coalition believes in—that they are elected in order to sweep away governmental regulation and to sweep away anything that would get in the way of the operation of the market.

Finally, haltingly, with another concession to the fact that you might have to put aside some money for that national infrastructure, we have a proposal to spend in the order of $3.1 billion, $1.1 billion on the Connect Australia fund and another $2 billion to be rolled into the Future Fund—to put aside the modern equivalent of 30 pieces of silver for the betrayal of the interests of the Australian people, money to be put aside to future proof telecommunications in Australia.

The only way that any government can future proof telecommunications is to stay in the business and continue to run the national network, maintain it, expand it and strengthen it, not sell it off to a private monopoly. This is about monopoly capitalism and transferring what was a full public monopoly of a wholly owned Telstra into a private monopoly where the vast bulk of the moneys earned from telecommunications in Australia comes to just one company—Telstra. The vast bulk of the market reach and coverage is in just one company—Telstra. The monopoly capitalist in communications in the future will be Telstra. In other areas, in the broad information, media and broadcasting areas where we have a duopoly, if you like, with a few attendant, tangential players—largely the Murdoch and Packer empires—the fact that they might actually buy into and take a key part of this fundamental monopoly is a betrayal of the interests of the Australian people.

The only way you can completely future proof telecommunications is by ensuring that the Australian government has the responsibility to provide the national network infrastructure and continues to be a key player in this area. As you know, Mr Deputy Speaker Baldwin, and as I and every other person who has been on the telecommunications committee in this parliament knows, nothing is future proofed when it comes to telecommunications. There was the plain old telephone system, the POT system, which existed 20 years ago, the same one that was in existence in the late 1960s when my brother became a telecommunications technician. He was trained in a full government institution, which provided a core of trained apprentices. This no longer happens. Telstra has gone out of the game of providing newly qualified, trained young people to service its needs and the needs of the community, as has the New South Wales State Rail Authority and a range of other authorities. Back in those days, even if you go back only 15 years, the dominant need in Australia was the plain old telephone system, but we had a telephone system in transition.

All of the measures that we have seen so far in terms of cost reduction have, by and large, come from the transition from an analog network into a digital network. Continuing cost benefits will come not through so-called competition and certainly not through selling off a public monopoly. Cost benefits will come from a move into internet telephony and from using a lower cost base in order to provide services that have been provided in the past—not only for voice services but for data services which are increasing exponentially.

Consideration was given in the past, after this government determined that it would break up Telstra, as to how best to deal with the problem of a telecommunications system where the key network infrastructure was not being guaranteed and where the maintenance was not being done. Labor has argued for the last nine years plus, since I have been in this parliament, that one of the core responsibilities this government had was the renovation of the telecommunications infrastructure. What we have had absolutely ascertained recently from the new CEO of Telstra is that that maintenance of infrastructure has not been undertaken.

This is a betrayal not only of the past but of the future. It is a guarantee that the move from public to private monopoly will be at the expense of the Australian people, not just in terms of the current 30 pieces of silver—the $3 billion that has been put aside to buy off the electorate, to assuage the fears that they have with regard to future telecommunications needs—but it will be a betrayal of the fundamental responsibilities that governments have had since 1901. In 1901, the federal government had only three responsibilities: post and telegraph, customs and excise and the defence of the realm. This government seeks to completely obliterate almost all of those prime functions.

Mark my words, Australia Post is next. Yesterday in question time, the Prime Minister said, ‘No, we won’t be touching Australia Post. We wouldn’t even dare to think about doing anything to Australia Post.’ Yesterday, and the day before, he said, ‘No, the government have always been completely up front about the fact that we wanted to sell Telstra.’ I beg to differ and give the lie to what the Prime Minister said yesterday.

As anyone in the coalition knows or should know, certainly if they were elected in 1996, the then opposition did not go to the election promising to sell all of Telstra. It was entirely conditional. They said, ‘What we want to do is sell just one-third of Telstra, 33 per cent. We don’t think we should actually sell any more.’ Indeed, when he was questioned by Derryn Hinch—I am thankful to the member for Perth, Stephen Smith, for including this research in his speech and I will utilise it—Mr Hinch said to him, ‘Why don’t you sell the lot?’ Mr Howard said, ‘Why? I’m not certain that selling the lot would be in the interests of the Australian community.’ He was conditional, as he always was—‘I’m not certain.’ What made him certain? Was it getting into government and being able to sell a third? In 1990 when there was a major debate in this chamber, this Prime Minister argued for the full sale of Telstra and he has always believed in it. He has believed in the complete destruction of government ownership of this key entity. Philosophically he is completely against government ownership and he is blind to anything else.

In the great debate before the 1996 election, Ray Martin asked Mr Howard, then the Leader of the Opposition, ‘Why sell a third of Telstra?’ Mr Howard said, ‘Well, no, no ... because we believe that the right policy mix is to sell a third and retain two-thirds.’ Did he really believe it at the time? Was it one of those non-core beliefs just as we had core and non-core promises in 1996? He has always believed that the government should not own Telstra, that it should become a private monopoly rather than being a public monopoly for which the government is responsible, because the Prime Minister believes in a government that is irresponsible with regard to its fundamental obligations as a Commonwealth government.

We have seen a lot in the time I have been in this parliament: firstly, the flogging off of the first third of Telstra, and then the proposal for selling off just another 16⅔ per cent—just another bit to earn a few billion dollars through Telstra mark 2. When John Fahey was the minister responsible, as the shareholders who bought the heavily discounted first one-third of Telstra know, the Commonwealth paid an enormous amount to sharebrokers to sell the T1 tranche at a dramatically discounted price when payment was cut into two pieces—pay part now and pay the rest later, when you can. Those who bought the second tranche of Telstra, where half as much again was sold, have paid enormously dearly and have seen the value of what they bought dramatically reduced.

There is no single reason that should drive this government in this way, except its ideological passion and commitment to sell 51 per cent of Telstra. Government after government worldwide understands this: there is nothing philosophically wrong at base with a government owning all or part of its major telecommunications infrastructure and, indeed, taking responsibility not only for having it and providing the services but for updating it and making sure that the country has an advantage vis-a-vis other countries. Other governments understand that you cannot just leave that to market forces. In Australia it is not just a question of what happens out in the bush—what happens on the national highway when you cannot get a continuous GSM service from Sydney to Canberra because the right investment has not been made to ensure that the system works. It is exactly the same in Sydney: you cannot get a continuous GSM signal from one area of Sydney to the next as you drive through it; you get drop-outs all the time. And it is not due just to the number of people using it; it is due to the fact that the network infrastructure is inadequate and not enough money has been put into it to make it work. It is a government responsibility to provide that.

Since 11 September 2001, step by step, very slowly, it has become apparent to this government and the United States government that there is a fundamental need to ensure the safety of the community at large across a range of different areas and one of the key areas where it is absolutely necessary is telecommunications infrastructure. Not only government regulation but government control, as we still have now with 51 per cent ownership, can ensure that the regulations are enforced. Does anyone out in the general market—any person experienced in the share market, any of the brokers connected with this or any of the business analysts—seriously think that an untrammelled Telstra, which is 100 per cent shareholder owned with no government ownership, will be bound hand and foot to abide by all parts by the regulations imposed by the government? History would say that, even with the government owning 51 per cent, that is not the case. We have seen that revealed recently.

It is not just a case of one CEO changing over to another. Ask any Telstra technician, anybody who has worked in the exchanges or anyone who has worked in the pits in the last 10 years and they will describe the state of the infrastructure in our telecommunications area and what has not been done by Telstra or enforced by the government. They will tell you about the parlous nature of security at Australia’s telecommunications nodes. They will tell you that it is possible for people to enter our telecommunications installations. They can do it now as private contractors who are not fully cleared for security. They know that there is an open door. Those who would seek to walk through that open door and dramatically impinge on our capacity to maintain our communications system—terrorists and so on—could do so.

All of those people involved in the share market in Australia also know that there is a giant bucket of money to be made out of the sale of the remaining 51 per cent of Telstra. They know because of the costs involved in T1 and T2. They know about the hundreds of millions of dollars that went out in fees. They know how much it costs to market this Australia wide and then overseas. They know that all of that money is a windfall for that part of the economy, but it all essentially comes out of the pocket of the normal Australian, who is being betrayed by this legislation.

What do we have? We have a new high broadband incentive scheme, gushingly announced by the Minister for Agriculture, Fisheries and Forestry as the spokesman on communications in the House. We have Connect Australia. This is the great new nirvana—the future proofing of the regional areas of the country by this government. The member for Maranoa spoke prior to me. He knows, as I do, that when Networking the Nation funds were expanded in his electorate they did not go to building fundamental new network infrastructure; they went to a teleconferencing scheme which provided high-cost teleconferencing that did not add to the fundamental capacity of the people of Maranoa to join the new network and digital age. It was an old technology that was extremely high in unit cost and really did not deliver.

The story of Networking the Nation is a sorry one, from Maranoa to other communities and electorates Australia wide. There was no combined, sensible, balanced approach to building up our national infrastructure; we had a hodgepodge of whatever was a good local idea to improve your communications system. That is not the way to do it. The way to do it is not by buying off local electorates, by throwing money at them—a few hundred million here and there and another $1.1 billion for Connect Australia in order to buy off people and say, ‘We’ll future proof it and it’ll be okay.’ We need to improve the network we have, strengthen it, deepen it and ensure that it has the ability to change as we go into the future. I do not believe that we need to do that by going off to privateers to provide it. This is a central government imperative and one that this government is walking away from, ignoring the responsibility they have to the Australian people.

The financial impact statement for the main bill that we are dealing with in this debate basically says the government does not have a blind clue about what it is going to earn from this:

I’ll bet they are.

We have heard that before, have we not? Tell that to the people who have T2 shares, and look at the value they currently have. If you combine T1 and T2—some people have a combination of both—you might be able to ameliorate that situation. But no-one knows what will happen in the current circumstances, with the plummeting of Telstra’s share price and the fact that the CEO has just said, ‘If we’re looking at profit forecasts, given that there hasn’t been appropriate expenditure on maintenance and on improving the fundamental network, we have to reduce our profit forecasts by 10 per cent.’ So it is no wonder they cannot work out when they might sell all or, more probably, part of Telstra in a series of future tranches.

The financial impact statement goes on to a series of reasons why they would have to do it: they would have to look at ‘overall market conditions’, ‘expected demand’ and all the rest of it. But the core lesson is this: if $30 billion, $25 billion, $22 billion or $32 billion is realised and that is put in part into Connect Australia and in part into the Future Fund—which will not future proof—why would you be such a dummy, as an individual or as a government, to deny yourself the future income dividend streams from Telstra of $1½ billion or $2 billion a year? Treasury itself has worked out that the minimum amount the government is denying itself as a result of deciding to sell the whole of Telstra is $140 million a year into Australia’s coffers. From now to kingdom come, the Australian government could have $1½ billion plus per year, and going up, because we own 51 per cent of Telstra. We had $3 billion to $4 billion in dividends when we owned it fully. This is a disgrace and the legislation should not go through. (Time expired)