Senator SCHACHT (10:54 AM) —I rise to speak on the government's package of telecommunications bills, of which the main thrust is the full privatisation of Telstra. We in the Labor Party have consistently opposed any privatisation of Telstra, going right back to 1996.

Senator Ian Campbell —1995.

Senator SCHACHT —When you proposed the bill in the parliament. No-one else has proposed a bill to privatise Telstra. The present government was the first one to put a bill into this parliament to propose the privatisation of Telstra.

Since the first bill appeared, we have been unequivocal in our opposition to any privatisation of Telstra. In 1996, on the traded vote of Senator Colston, who was offered the job of being then Deputy President of the Senate, the coalition was able to achieve its objective of the one-third privatisation of Telstra. When the full privatisation was put before the parliament just before the last election, Senator Colston voted against it, so the bill for the full privatisation was defeated.

The issues we in the opposition raised in opposing the one-third privatisation, with the support of the Democrats and the Greens, are still relevant today. One of the issues we raised during the inquiry into the one-third privatisation of Telstra was the fact that the government was demonstrably undervaluing the asset. I remember evidence given by Professor Quiggan which was laughed at by government senators on the committee at the time. The minister, Senator Alston, attempted to discredit Professor Quiggan when the professor said he thought the full value of Telstra would be at least between $55 billion and $60 billion, therefore one-third would be around $20 billion plus. It was argued that he did not know what he was talking about. `He is ideologically opposed to privatisation. He would say that, wouldn't he?' were the remarks made by the minister and by government senators on the committee.

Senator Ian Campbell —Remember what he said about the Commonwealth Bank?

Senator SCHACHT —He has subsequently been proven to be absolutely correct. The government privatised one-third of Telstra for about $14 billion. That $14 billion is now worth double—$28 billion. The government gave away the people's asset at a loss of about $14 billion. It was the biggest loss of government assets that I know of in the history of Federation.

Senator Ian Campbell —You've forgotten about the Commonwealth Bank and Qantas.

Senator SCHACHT —It was pointed out to the government at the time that you were underselling, even if you wanted to proceed with the privatisation. But the government wanted to make sure that those who bought the shares, including foreign owners—those overseas who were guaranteed allocation of one-third of the shares from the one-third privatised—got their shares. Also foreign stockbroking companies—

Senator Ian Campbell —You sold Qantas to British Airways, you hypocrite!

The ACTING DEPUTY PRESIDENT (Senator Reynolds) —Order! Senator Campbell will withdraw—

Senator Ian Campbell —This is the bloke who sold Qantas to British Airways, Madam Acting Deputy President. I cannot believe the breathtaking hypocrisy of this. The Labor Party sold Qantas to British Airways.

The ACTING DEPUTY PRESIDENT —Senator Campbell, you will resume your seat and withdraw.

Senator Ian Campbell —I withdraw.

The ACTING DEPUTY PRESIDENT —Senator Ian Campbell, you are persistently interjecting. You will not use that word.

Senator SCHACHT —It is quite clear that the government, led by the parliamentary secretary, is extremely agitated and obviously embarrassed. The louder the noise the Parliamentary Secretary makes indicates the weaker the case the government has for full privatisation. At the one-third privatisation we had a guarantee that a third of the shares would be sold and allocated to overseas interests. Overseas stockbroking companies made millions and millions of dollars selling. On a number of occasions we were told by the minister that we had to get overseas expertise into the shareholding of running Telstra; that is why one-third was allocated. So what did we find? A day after they got the shares and the price went up, those interests in America sold their shares and made a killing. They weren't interested in providing expertise in improving the telecommunications system in Australia. They took their profit in a day and disappeared forever.

This government's administration of the process was shameful. Not only did they allow for the diddling of the Australian public—by $14 billion—but also they allowed foreign interests to walk off with a capital profit in 24 hours. Now, in the process to sell the whole lot of Telstra, we find in the bill that up to two per cent of the value of the sale can go in fees—

Senator Ian Campbell interjecting—

The ACTING DEPUTY PRESIDENT —Senator Schacht, you will resume your seat. Senator Campbell, you are persistently interjecting. I understand that there is some heat around this debate and I am being as tolerant as I can be. I didn't draw your attention to your use of another related word but I will not accept the use of the word `hypocrite'. Whatever your views are, you are not permitted under standing orders to accuse the senator of that in this place. Will you please withdraw again and will you desist from using that word in this place?

Senator O'Chee —Madam Acting Deputy President, on a point of order: my understanding was that Senator Campbell did not actually refer to Senator Schacht as a hypocrite on this occasion; he referred to the opposition as being `a bunch of hypocrites'. I understood that you could be accused of being unparliamentary not when you referred to a group of people but only when you referred to one person. But I am happy to accept your guidance on that matter.

The ACTING DEPUTY PRESIDENT —It just shows how ridiculous the semantics of this debate can be in terms of the use of certain language. I know that the use of the singular in reference to one senator is not acceptable. The use of the plural for all senators is apparently blurred. Clearly, anyone listening to this debate will say: haven't we got better things to do with our time than to engage in such semantics? I will refer that question to Madam President. But it would be helpful if we could pursue the debate, as I am sure the government is anxious to do.

Senator Ian Campbell —Madam Acting Deputy President, on the point of order: I will not delay the Senate because it is not in the government's interests, but I think the issue that you are going to refer is a wise one to refer. Obviously interjections are out of order, but perhaps Senator Schacht could reduce the interjections if he were to at least canvass within the debate—an important part of the debate—where he sees the difference between selling 25 per cent of Qantas to British foreign interests and this bill limiting foreign ownership to less than 12 per cent. I see hypocrisy in that. I think Senator Schacht could address that matter. I will then certainly cease interjecting.

The ACTING DEPUTY PRESIDENT —Senator Campbell, you are aware that that is a debating point and not a point of order. Could we continue without interjections and without debate over the use of particular words?

Senator SCHACHT —The government is clearly sensitive on this issue of Telstra. They know it is unpopular, particularly in rural Australia. At the last federal election two senators from the National Party lost their seats. Two parties, further to the right than the government on some issues, on this issue campaigned against them. The One Nation party opposed the privatisation of Telstra. One of the reasons? That party, unfortunately, got a lot of support in rural Australia. So we know why the government is sensitive about it.

I want to return to the issue of the value of Telstra. The government under the arrangements in this bill have said that up to two per cent of the gross proceeds of what they get from the sale can go as fees and charges to the stockbroking companies and the institutional and financial advisers who are going to be in charge of the privatisation process. If the two-thirds is sold for the price which the market now values it at, at around $50 billion plus, that means that two per cent, over $1 billion, could be available to stockbroking firms and financial advisers both inside and outside Australia.

A billion dollars. How many hospitals would that build? How many aged care centres would that improve? How many high schools would that improve? How many research centres at universities would that build? All of those things could be done with a billion dollars. But no, this government wants to give it to its mates in the financial sector. No wonder that group is cheering in the newspapers every day, saying: `We support the privatisation of Telstra.' They want to get their hands in the public till and get their fees and charges, worth up to a billion dollars, in the process. I think all ordinary Australians would agree that there is a better way to spend a billion dollars of the public's assets than giving it in fees and charges to the stockbroking community, including international stockbrokers.

The issue here is about what we see as our telecommunications system in a country the size of Australia, with 18 million people sparsely spread across this massive continent. We are a lucky country in that we have a continent to ourselves, but it is a sparsely populated continent. The opposition would say that all Australians, wherever they live, having adequate access to reasonable telecommunications is a fundamental right, not something that governments or the community can choose not to provide.

We all know that in the 21st century if you do not have access, wherever you are, to up-to-date communications systems, you will be disadvantaged socially and economically. A phrase that has been used before is that, in the next century, there will be groups of people who will be information rich and information poor. There will be new terminology for the definition of poverty.

We have to ensure that all Australian citizens, wherever they are, are not accidentally made poor by being prohibited from having access to the latest communications systems. In a country of our size, with only 18 million people, that is a big ask with respect to delivery. If you let the free market decide it alone, it will mean that Sydney, Melbourne and the other capital cities will have the up-to-date system but the rural and outback areas will not, or they will only get it if a higher price is charged which will make it uneconomic for them to use, whether it is for business or for social communication. We in the opposition believe that this is a fundamental issue about keeping Australia together. If you do not have a communications system that can provide that equally to all, you disadvantage some citizens. This is an issue of equity as much as it is an issue of economics or privatisation.

Some people claim that because we have a competitive market in communications it is therefore impossible to have public ownership. We in the opposition have never subscribed to that view. We believe that the communications system has been improved for all Australians by allowing competition—setting up rules that allow other people to compete with Telstra. But we know that, if you remove Telstra from public ownership, in the long run there will be no-one there at the behest of the public to provide the service to all Australians. That is why maintaining Telstra in public ownership is so important. All Australians, each day of their lives, need to have access to the telecommunications network that Telstra built as an investment when it was fully government owned, on behalf of all Australian people.

Other public enterprises in the past have been privatised. The issue of the Commonwealth Bank and Qantas has been raised. The fundamental difference is that Qantas provides a service, on a daily basis, which fewer than two or three per cent of Australians regularly use. Qantas is not an operation—

Senator Ian Campbell —Two million frequent fliers in this country.

Senator SCHACHT —But I have to say that because of the way in which the civil aviation market works, there are plenty of other opportunities in other companies. Qantas does not provide the service every day that Telstra provides to every citizen in this country. It is the same with the Commonwealth Bank: it has only about 20 per cent of the financial market. Eighty per cent of Australians choose not to use it. Eighty per cent of Australians have to use Telstra's network at some stage each day when they make a phone call, even if they are going through Optus or one of the other competitors. Overwhelmingly, they have to interconnect to Telstra's network.

Often in these debates in recent times, with the ideology of this government, public interest seems to be given a great big miss. Public interest is the issue that we in this parliament should always be fundamentally concerned about. It is in the public interest to hold Telstra in majority public ownership.

We have accepted that one-third has gone. We accepted at the last election that we will not be able to buy back that one-third; it will stay in private ownership. But we know that, as soon as you give away majority ownership and remove the right of the minister to use the power to direct Telstra in the public interest, Telstra will shift to a different form of operation. It will shift to an operation driven only by profit. That is what a privately owned company is about. The issue of providing public interest is not high in its priorities. And why should it be? That is the difference between the private and the public sectors.

If you are a farmer on the western plains of New South Wales or in the mid-north of South Australia, your public interest, your economic interest, is to ensure that in the future you have access to the best telecommunications system which everyone else is using. If we want to be a clever, modern country, that is what we must have. They know; that is why there is such strong opposition in the rural areas of Australia to the privatisation of Telstra. That is why some members of the coalition government who represent those outback areas are strongly opposed to the privatisation of Telstra. Mr Katter, the member for Kennedy, and Mrs De-Anne Kelly, the member for Dawson, representing outback areas of Queensland, are on the record as saying that they oppose the privatisation of Telstra. When they are asked why they oppose it, they say, `We know what will happen: the service will get worse, the costs will go up, people will lose their jobs and the service will be reduced.' They also say that, overwhelmingly, their constituents who vote for them to represent them in this parliament do not want them to vote for Telstra's privatisation.

On this occasion, the view overwhelmingly in the bush cannot be ignored. There are enough difficulties in the economic future of regional and rural Australia without running the risk of reducing the one area of service that provides an opportunity for these areas to have an economic future—that is, access to the full, modern communications system. We do not want to take that risk. The government is willing to take that risk because it is ideologically obsessed with this issue and wants to go to full privatisation.

The government has said it will have some form of private inquiry into or review of services to the bush before privatisation proceeds. I am not sure whether a further sale of 16 per cent is covered by this review, or whether the review will automatically take place even before 16 per cent is sold. That is unclear. At the moment, maybe the government is negotiating with Independent senators about that. What they have put up here, as we had last time, is a joke. The review would take place and make comments, but it would not hold up the privatisation process—that will take place anyway. It is already in the budget papers, before this legislation has been passed. All the budget estimates and outlays for the next four years are predicated on the full privatisation of Telstra.

So the government has made its intention clear. Any review of the services provided by Telstra is irrelevant according to the budget papers. There will be a very interesting discussion in the estimate hearings in the next two weeks about how the government can put those estimates in without the review being conducted and without any outcome being known. It is a charade and most people in rural and regional Australia know it. Most ordinary Australians know it. Most ordinary Australians, even those who own shares, do not want a majority of Telstra sold. They want to keep it in public ownership because they know that privatisation now means three things: increased charges, reduced services and a loss of jobs. That is what the sale of one-third of Telstra did. Something like 25,000 jobs went out the window. There was no excuse made by Mr Blount and others that this is the outcome in order to make a more competitive Telstra—to meet the challenge of providing a competitive service to improve profit. The profit is already substantial. The profit should remain year in, year out—going back to the bottom line of the budget—to provide increased services. We announced that policy at the last election.

The ordinary members of our community know deep in their souls that to sell all of Telstra would be a fraud on their public interest. In this Senate, we have to be very careful how we vote—that we do not allow Australia's greatest national asset to be sold off at a whim to meet the ideological obsessions of this government.

We have been told that there is privatisation occurring in many countries. That is true. But I note that, although a lot of countries have sold a part of their telecommunications companies, many of them are reluctant to sell the lot. Many of them are still holding a majority of those companies in public owner ship. Most of them in Western Europe, with a couple of exceptions, still have in one form or another public influence or public majority ownership. They know their own people do not want it. They know that there is a risk to the public interest if you sell the lot because communications, telecommunications and all the new systems are fundamentally going to organise and affect the way our societies are run. Therefore, the opposition maintains its unequivocal opposition to any further sale of Telstra. We have opposed it from when the legislation first appeared in this place in 1996, and we continue to oppose it. I hope again on this occasion there is a majority in the Senate to oppose this very awful bill.