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Wednesday, 16 October 1996
Page: 4326

Senator TIERNEY(6.40 p.m.) —I rise with pleasure in this debate to support the Telstra (Dilution of Public Ownership) Bill 1996. It is rather strange that Senator Carr and I actually sat throught the same set of hearings and read the same evidence. I sat there listening to what he had to say and was absolutely amazed that he came to some of the conclusions that he did. He must have been listening to the evidence out of his left ear, I fear.

Let us return to what this bill was about and the importance of it for Australia. What it will do is bring Telstra up to world-class standard. The opponents of this bill like to play on public fear of the unknown by suggesting that this is a giant leap in the dark. In fact, it is quite the opposite.

Australia is probably the last cab off the rank in terms of advanced countries in the world and even some of those that are not so advanced. Telstra is the only one of about 20 major telcos around the world that has not been partly privatised or privatised, and this bill is proposing the sale of only one-third of Telstra. When you get Fidel Castro part-privatising his telco and selling off a fair bit of it over to the people in Mexico you know you are in a rather strange situation in Australia where we have all the opposition parties off to the left of Fidel Castro and Cuba and indeed the former regime in Albania.

Let us examine the opposition's hypocrisy on this part-privatisation of Telstra. In 1994, the then Prime Minister, Paul Keating, was asked on the ABC program Lateline about the privatisation of Telstra. Reporter Kerry O'Brien asked whether it really mattered if Telstra was privately or publicly owned. The answer from Mr Keating was both accurate and succinct: `Ah, not of its essence, no.' That was his response, and that was consistent at the time with Labor's other privatisation decisions with the Commonwealth Bank and the Qantas float.

It is very difficult to understand why you can support the privatisation of Qantas and the Commonwealth Bank and not support the privatisation of Telstra. I fail to see the ideolgocal basis of one set of decisions and not of the other. The reason you cannot sort of work out the ideology of it is that it is just purely a matter of expediency. It is expedient and it is tragic, particularly when such a sale is in the best interests of Australia.

The Australian Democrats' position is probably even more curious. They have shown some sensible approaches here today on IR, and I would urge them to do a similar thing with the Telstra bill. They claim, curiously, that they have some sort of mandate to oppose Telstra. They have got a very funny idea of what a mandate is. I thought in that last election that the coalition parties in 1996 won 50 per cent of the Senate seats. I thought we won a 45-seat majority in the lower house—an outstanding majority in the lower house—and, in the upper house, 50 per cent of the seats. I would have thought that 50 per cent was a pass, and that is exactly what should happen with the Telstra legislation.

Senator Forshaw —How do you get 50 per cent?

Senator TIERNEY —Just look at the maths there, Senator. If you get out a pen and paper and work through it slowly, you might actually work out that 50 per cent is a pass.

Let us turn to the Telstra inquiry, that famous delaying tactic where the government had totally made up its mind. The opposition sent it off to a reference committee, which was terribly dishonest, because it is a bill. It is called the Telstra bill and, as a matter of fact, at each site for our inquiry they had a sign up that said `Teltsra Bill this way'. So why did it not go to a legislative committee? It did not because they added in a few other bits and pieces to try and make out that this was about a reference. And of course they had control, they had the majority.

The real game was exposed in this place by Senator Faulkner, who belled the cat by announcing before we had the inquiry that Labor was going to oppose it. Why waste all that money having an inquiry if they were already opposed to it before we went to an inquiry? They compromised the terms of reference of this inquiry by throwing in a whole range of issues unrelated to the terms of reference.

Sixty per cent of the submissions dealt with overhead cabling. Senator Carr trumpeted the number of submissions, but over two-thirds of those submissions were only one page in length. A lot of the information before the inquiry—even by the people who turned up—was ill-informed, particularly as we could not find any opponents to the bill who had even read the bill. How on earth can you come out in a public hearing opposed to it if you have not even had a look at it? A substantial number of the submissions did express support for the part-privatisation of Telstra.

After all those hearings, all that time and all those witnesses, we ended up with what was a pretty poor report. The majority report of the opposition simply ignored the majority and weight of the evidence favouring a one-third sale of Telstra. It was intellectually dishonest and it produced a report with a very predetermined position. The majority report quotes evidence from the National Farmers Federation and Australian Women in Agriculture, yet fails to acknowledge their pro-privatisation stance. There is no comparable body of evidence to demonstrate the benefits of keeping the business in public ownership.

We had a seminar in this parliament with a speaker in favour of keeping Telstra in full public ownership. He looked for examples around the world to see where it would work better. He could come up with only one—Iceland. Iceland is the only place where full public ownership works better. I suppose the telephone system in Reykjavik goes about two kilometres out of town, and that is about it. In that sort of area, you could probably run a fairly efficient system.

The inquiry basically was a waste of time. There was no tidal wave of community support for what the opposition was trying to do here on the core issues of the bill. The number of hearing dates was cut by 50 per cent. We could not find much interest out in rural and regional Australia. As a matter of fact, the evidence that we did gain supported the bill.

It is somewhat hypocritical for the Labor Party, on the basis of that lack of evidence and on the basis of their former government's position—former Prime Minister Keating wanting to sell the lot of it a few years ago—to want to go ahead with that. What people have to remember is that it was the Labor Party that actually started this whole process by giving away half of Telstra's monopoly to Optus and then planning for it to expand further.

What we are proposing is a logical extension of that process. In every country where government owned monopolies have been changed—exposed to competition—part-privatisation or privatisation has actually followed. This government has placed telecommunications reform very high on its list of priorities for its first term. That is why we are debating it here so early in the time of the new government. The reasons for this are quite obvious.

Australia's telecommunications sector must maintain the momentum of change to ensure that we have a world-class communications infrastructure. The Australian telecommunications market has doubled in size over the last few years. It is a highly contested domestic and international environment and it cannot afford to have a bloated and inefficient Telstra that will not be able to compete in the new markets in the post-1997 environment.

We must be prepared for new growth. We must have a dynamic flexible company which will take on new demands like the Internet and other telephone based services. Telstra is also facing the reality that its operating expenses are increasing faster than its revenue growth. That also brings in the need for market discipline to get Telstra working as a more efficient operation.

There have been some advances in the efficiency of Telstra in recent years, but there is considerable room for improvement. The part-privatisation of one-third of Telstra can deliver efficiencies and these can be passed on to consumers. Benefits in the form of improved services—

Debate interrupted.