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TELSTRA (TRANSITION TO FULL PRIVATE OWNERSHIP) BILL 2003
- Parl No.
- Question No.
Buckland, Sen Geoffrey
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- Start of Business
- KYOTO PROTOCOL RATIFICATION BILL 2003 [NO. 2]
- FOREIGN AFFAIRS: UKRAINIAN FAMINE
- CHRISTMAS ISLAND: MINING PROPOSALS
- SENATE: COMMERCIAL CONFIDENTIALITY
- CONSTITUTIONAL REFORM
- CONSTITUTIONAL REFORM
- CONSTITUTIONAL REFORM
- FORMAL MOTIONS
- TELSTRA (TRANSITION TO FULL PRIVATE OWNERSHIP) BILL 2003
PETROLEUM (SUBMERGED LANDS) AMENDMENT BILL 2003
OFFSHORE PETROLEUM (SAFETY LEVIES) BILL 2003
FARM HOUSEHOLD SUPPORT AMENDMENT BILL 2003
- Second Reading
- In Committee
- Third Reading
- FINANCIAL SECTOR LEGISLATION AMENDMENT BILL (NO. 2) 2002
- TELECOMMUNICATIONS INTERCEPTION AND OTHER LEGISLATION AMENDMENT BILL 2003
QUESTIONS WITHOUT NOTICE
Defence: Defence Capability Plan
(Evans, Sen Chris, Hill, Sen Robert)
(Colbeck, Sen Richard, Minchin, Sen Nick)
Foreign Affairs: Dr Mahathir Mohamad
(Ray, Sen Robert, Hill, Sen Robert)
Law Enforcement: Gun Control
(Macdonald, Sen Sandy, Ellison, Sen Chris)
(Faulkner, Sen John, Ellison, Sen Chris)
(Bartlett, Sen Andrew, Hill, Sen Robert)
Arts: Playing Australia
(Lundy, Sen Kate, Kemp, Sen Rod)
(Murphy, Sen Shayne, Macdonald, Sen Ian)
- Family Services: Child Care
Insurance: Public Liability
(Watson, Sen John, Kemp, Sen Rod)
(Faulkner, Sen John, Hill, Sen Robert)
Indigenous Affairs: Children
(Harris, Sen Len, Vanstone, Sen Amanda)
Customs: Illicit Drugs
(Bishop, Sen Mark, Ellison, Sen Chris)
Employment: People with Disabilities
(Ferris, Sen Jeannie, Patterson, Sen Kay)
- Defence: Defence Capability Plan
- QUESTIONS WITHOUT NOTICE: ADDITIONAL ANSWERS
- MINISTERIAL ARRANGEMENTS
- QUESTIONS WITHOUT NOTICE: TAKE NOTE OF ANSWERS
WORKPLACE RELATIONS AMENDMENT (COMPLIANCE WITH COURT AND TRIBUNAL ORDERS) BILL 2003
WORKPLACE RELATIONS AMENDMENT (CODIFYING CONTEMPT OFFENCES) BILL 2003
WORKPLACE RELATIONS AMENDMENT (IMPROVED REMEDIES FOR UNPROTECTED ACTION) BILL 2002
- DELEGATION REPORTS
- LAOS: SEPON MINE
- AUSTRALIA-UNITED STATES FREE TRADE AGREEMENTREGULATION OF GENETICALLY MODIFIED FOODS
- SYDNEY OPERA HOUSE
- EDUCATION, SCIENCE AND TRAINING: ROAM CONSULTING
- KYOTO PROTOCOL RATIFICATION BILL 2003 [NO. 2]
QUESTIONS ON NOTICE
France: Australian War Graves
(Bishop, Sen Mark, Hill, Sen Robert)
Defence: Security Clearances
(Evans, Sen Chris, Hill, Sen Robert)
Attorney-General's: Military Compensation
(Brown, Sen Bob, Vanstone, Sen Amanda)
(Allison, Sen Lyn, Hill, Sen Robert)
Immigration: Parent Visa Applications
(Hutchins, Sen Steve, Vanstone, Sen Amanda)
Science: Chief Scientist
(Brown, Sen Bob, Vanstone, Sen Amanda)
Defence: HMAS Kanimbla
(Evans, Sen Chris, Hill, Sen Robert)
National Radioactive Waste Repository
(Allison, Sen Lyn, Vanstone, Sen Amanda)
Romania: Australian Mining Companies
(Brown, Sen Bob, Hill, Sen Robert)
Environment: Ningaloo Reef
(Brown, Sen Bob, Hill, Sen Robert)
- France: Australian War Graves
Thursday, 30 October 2003
Senator BUCKLAND (11:22 AM) —I seek leave to incorporate Senator Carr's speech on the Telstra (Transition to Full Private Ownership) Bill 2003.
The speech read as follows—
Like all other Labor senators I rise to oppose the provisions of the Telstra bill 2003.
The privatisation of Telstra has been a shibboleth of the new right since the 1980s. It's a tragedy that this government still seeks to pursue such an old fashioned notion.
What is an even greater tragedy is the National Party. As a party it has demonstrated yet again its craven capitulation to the free market ideologues of Collins Street and Pitt Street. The grovelling support of the National Party for this bill highlights yet again why it is that this party has lost its political integrity.
The National Party no longer represents the interests of rural voters—if it ever did. This is why citizens living in regional areas are, in increasing numbers moving, switching their support away from the National Party to the Labor Party and to progressive independents.
In Victoria, New South Wales and Queensland we see that at both state and national levels, the National Party is losing seat after seat.
In 1996 the National Party held 18 House of Representatives seats and six Senate seats. In 1998, the National Party lost the seats of Capricornia and Hume. After the 2001 election, in which it lost the seats of New England, Farrer and Kennedy, the National Party had only 13 members of the House of Representatives and four senators.
Let's look at the states. In 1988, the National Party held twenty seats in the New South Wales lower house. It now holds only twelve. Between 1992 and 2003, the National Party lost two states seats in Victoria. In the same period, the National Party representation in the Queensland legislature has fallen from 26 to a mere twelve.
What is the National Party's response to this crisis? It is to grovel more completely to the very forces that have led to its destruction.
At its recent conference, the National Party sought to re-badge itself. Quite clearly it is no longer the party of McEwen and Page. It is the party of lickspittles and servants of the big money interests in Melbourne and Sydney, and in New York and London.
A perusal of the Senate committee's report highlights the inadequacies of this government's processes in its crusade to sell off one of our great national assets. The privatisation of Telstra has been characterised by a dirty and grubby rush to put this national asset on the auction block.
It is very sad to see just how beguiled the National Party really is. They are told that there is some electoral advantage in their support of this travesty. It is plain for all to see how mistaken this advice is. The privatisation of Telstra is nothing short of electoral poison. And every piece of electoral evidence that the party machines have produced through their own polling demonstrates this.
The Australian people know the dangers of putting profits and share prices ahead of the values of consumers and the nation. This is particularly the case in rural and regional Australia. The Australian people know that economic ownership brings with it control, and the proposed regulations aimed at limiting that control can be changed. And further they know that regulation can become obsolete by fiat of technological change.
Australians know that under conservative governments the pressure is always on to reduce the capacity of the government to intervene in the economy in the defence of the public interest.
Australians know that the market itself does not produce equity or equality of opportunity, nor does it guarantee lower prices or improved services. Australian history is replete with examples of market failure to produce these very cornerstones of a democratic society.
The minor competitors of Telstra in the mobile market are deeply concerned about the prospect of a privatised Telstra exercising effective monopoly power.
AAPT, Optus, Primus Telecom, numerous consumer groups, trade unions, and peak industry associations such as the National Farmers Federation have all expressed concerns about the prospects of Telstra's market dominance under a privatised regime.
The process that has led to the partial privatisation of Telstra shows what damage has been done to the social infrastructure of many rural communities.
The road that led to Telstra's partial privatisation is strewn with sacked workers, who were cast aside in a vain attempt to improve share price value. 30,000 jobs overall have already been lost. In 1996 Telstra employed 76,522 people. In 2003, Telstra employed 37,169 people.
The government claimed that these job losses have been the result of competition. The evidence is clear. Job losses were a result of the attempt to increase the return on invested capital. Maintenance staff have been cut as services have been outsourced. Capital investment which peaked at 2000 has declined by 25% from 4 billion to 3 billion.
The loss of the jobs and the declining capital investment has led to a deterioration of customer service and maintenance, yet still the government claims that the regional licence conditions outlined in this bill—the so called `future proofing measures'—should reassure us that this trend won't continue.
However, according to the evidence presented to the Senate committee, these so called `future proofing measures' are entirely a matter for the discretion of the minister, and can be removed should the political circumstances or the commercial realities require it.
The benefactors of privatisation claim that a modern and dynamic communications environment requires privatisation so that competition will be allowed to drive service delivery. Yet in the same breath they argue that because of the monopoly power of Telstra, a regulatory framework is needed to protect consumers and promote competition. Ever since the establishment of this schema there have been persistent arguments that the regulation of Telstra, even in a partially privatised state, are ineffective in limiting the effects of market dominance or in protecting consumers.
And so we have this argument about whether or not services are up to scratch. We have those that have a vested interest in the sale of Telstra claiming that services are quite satisfactory. The overwhelming weight of evidence points, however, to a contrary conclusion. I'm sure National Party senators sitting here today need only ask their constituents whether this is the case. We all know that the existing services and landline network are not satisfactory and not able to cope with demand.
This is a direct result of the failure to invest. This is a direct result of shifting the mindset of Telstra away from community service obligations and nation building to that of a profit drive model.
In the mobile networks, where there is gross under-capitalisation, it is still a hit-and-miss proposition as to whether you will get a reliable mobile telephone service when you need it. The system is often overloaded, even in a most densely populated and profitable area. We know that just 120 kilometres from Canberra you cannot get a telephone signal. Not to mention the black spots a mere ten kilometres from Parliament House.
These difficulties are apparent in cities across the nation. And there wouldn't be a senator here who doesn't know how hard it is in rural and remote areas to receive a signal.
The real danger is that there is no provision within this bill to bring future services within the universal service obligation regime. The government has no intention of making the internet part of the USO. We saw the recent collapse of the Big Pond where the failure to invest has meant that Telstra simply couldn't cope with the traffic.
It is myopic in the extreme to have excluded email—now an essential service—from the guarantee of service obligations. The internet is just as important these days as the standard telephone and public phone services. These services are essential to ensure reasonable equity of access for all Australians.
If we turn to the broadband provision, we see that Australia is currently 1,000 times inferior to our international competitors. Our regional universities, our regional research laboratories, our businesses in regional areas, are all seriously disadvantaged by our failure to meet international standards in regard to broadband. The parlous state of Australian universities was acknowledged in a National Office for the Information Economy report entitled `broadband in education: availability initiatives and issues' august 2002.
The report states that:
“for universities outside capital cities, bandwidth is limited. Regional universities have reported difficulty attracting and retaining high calibre academics because of their limited capacity to engage in collaborative research.
“Regional universities are important employers, providing direct economic stimulus in their communities. They have the capacity to attract overseas fee-paying students, which represents an important export market for Australia.
`access to higher education capacity networks should attract academics and students and improve employment prospects in these regional areas.
“James Cook University (JCU) in Townsville provides an example of the impact of these problems. While the Grangenet backbone connecting Sydney and Brisbane have a capacity of 5 gigabytes (Gbs)., the backbone that connects Brisbane and Townsville is only 22 megabytes (Mbs). James Cook University has recently launched its access grid which supports next generation video conferencing. This facility will have applications for research, help consulting and teaching. Access grid can run on as little as five megabytes, but requires up to 100 megabytes to work to its full potential. The cost of such capacities to Townsville from traditional carriers is prohibitively expensive.”
Turning to on-line learning, the report highlights that in regard to international education on-line learning is critical. A broadband technology is vital for the success of on-line learning.
International data indicates that in the decade to 2010, thirty million people will not be able to secure a university place. It is argued that on-line learning may have a huge potential to assist meeting this otherwise unmet demand.
On a cost recovery basis, these services will simply not be upgraded by the private market. It will require very large sums of public money to do this.
Yet these telecommunications services are essential for our national long-term economic prosperity. The telecommunications industry is a strategically vital sector of our economy. Our manufacturing base, and our service industries, are heavily dependent upon an effective and modern telecommunications sector.
Our national interest requires that these key sectors of the Australian economy be held in Australian hands. We simply cannot afford to have our telecommunications sector controlled by foreign capital.
Our national interest requires that monopoly power be publicly controlled to ensure that the lifeblood of the economy is not choked off by those who have a stranglehold on economic development.
A privatised Telstra will not guarantee that Australian industries develop in our national interest. A privatised Telstra would not guarantee that our economy is modernised to keep pace with the very best in the world.
The private market does not guarantee competition, nor does it guarantee equality of opportunity for all Australians.
The value of Telstra is in itself an unresolved question, however it cannot simply be measured in financial terms alone. The privatisation of Telstra may well lead to an injection of capital, and an impressive bottom line on the balance sheet on a one-off basis.
But the true value of Telstra amounts to much more than this simple figure. Any debate limited to such a narrow evaluation is inherently flawed and unhelpful.
Then again, if we want to talk about bottom lines, try talking to the people who bought shares in the T2 sale. They will soon point out that the great marketplace does not guarantee golden financial benefits.
No, the value of Telstra is much more than its book entry. For this reason, I argue that Telstra—a great national asset, a great key to economic development, to technological change, to social development, to community well being—can not be easily valued, can never be sold for its true worth to this nation, and as such, is simply too valuable to sell.
That is why I so strongly oppose this bill.
Senator BUCKLAND —I seek leave to incorporate the speech of Senator George Campbell on the Telstra (Transition to Full Private Ownership) Bill 2003.
The speech read as follows—
This legislation empowers the government to privatise the remaining government shareholding in Telstra. It empowers the government to ensure that Telstra becomes a fully privatised company and ceases to have any government ownership.
It is worth reminding the Australian people that there is only one political party that is represented in this parliament that has stood steadfast in its opposition to the privatisation of Telstra. The government want to privatise it. The National Party have cravenly buckled to pressure from the Liberal Party, have abandoned their rural constituents and are going to support the privatisation of Telstra.
The various minor parties, such as the Greens, the Democrats and One Nation, have all had the wobbles on the issue at various times in the past year or two.
The only party that have consistently opposed the sale of Telstra is the Labor Party, and we will continue to oppose this legislation. We do so for some pretty fundamental reasons. Our starting point in this debate is that telecommunications services are essential services.
All Australians need telecommunications services, particularly the traditional telephone, in order to function and participate in our society as equal citizens. Telstra delivers essential services to all Australians. It is still predominantly a public utility. It is a monopoly in most respects and, for those reasons in particular, the Labor Party continue to support government ownership of Telstra.
The reality is that this bill is not about good public policy. It is not about doing something for our communications environment that will benefit all Australians. It is an ideologically driven agenda in the same way most of the legislation that this government has brought before this chamber has been driven by ideology, not by a commitment to good public policy.
We have seen it in unfair dismissals, we have seen it in youth wages, we have seen it on the waterfront—we have seen it in a whole range of areas. In fact, one would have to say that this has been the most ideological government we have witnessed in this parliament for the past 50-odd years.
There are obviously more benefits to the Australian community in keeping Telstra in public hands than there are in allowing it to fall into private hands. We currently all share in the dividend that Telstra provides to the Commonwealth budget; as Australians we all reap the benefit of that contribution.
The reality is that that will be lost to the Commonwealth. But, more importantly, if Telstra is fully privatised, our capacity as a nation to determine the direction of telecommunications development will be severely restricted.
This government has used the great mantra of debt reduction to justify the sale of Telstra. Like most things with this government, it is all ideology and no substance. All this government has done is transform public debt into private debt. Privatisation only makes sense if the Government has better uses for the sale proceeds.
It does not.
The government freed up 30 billion dollars in the first 2 tranches of Telstra to repay debt. This saved 5 billion dollars in interest payments, but this was in place of 9 billion dollars in dividends foregone. That's a 4 billion dollar loss due to the ideological agenda of this government.
And who will benefit from the sale of Telstra?
Investors in the first tranche of Telstra were mainly the big end of town and foreign investors who made $3 billion on day one. Investors in the second tranche, of which the overwhelming majority were ordinary Australian families, have made a capital loss of $6 billion.
The government is projecting the cost of the sale in commissions and fees at around $500 million, will accrue to professional rent seekers who manage the privatisation. 500 million dollars! All to transfer public debt to private debt. And this is after the farce that was Telstra 1 sale.
According to the Auditor General “the total cost of the Telstra sale road show to the Commonwealth was $3.06 million ... despite the significant amount of Commonwealth expenditure involved, payments to the global coordinators were not independently verified ... through appropriate supporting documentation and an effective audit trail was not maintained of this Commonwealth expenditure.
Later on, an audit revealed that the road show had received overpayments of $151 000, including $105 000 of air travel tickets that were refunded but not passed on to the Commonwealth, $20 000 for private and excessive use of limousines, and $12 000 on personal expenditure and sightseeing.
The sale of the first two tranches netted $440 million for those involved in the sale process. Now we're talking about $500 million. Just how many limousines do these people need?
But this is the point of this government.
It is more interested in nice ideological headlines about debt reduction than confronting the real economic issues. Under this government asset sales have totalled $55 billion while debt was reduced by only $50 billion.
At the same time Commonwealth taxation has increased from 23.5 per cent of GDP in 1996 to 25.4 per cent of GDP in 2003 after adding back in the proceeds of the GST which is a Commonwealth tax. The results of these policies are that the burden of debt has been shifted from Government to households. Household debt has grown from $290 billion in 1996 to $660 billion now.
We are hearing plenty from Coalition senators about debt reduction, but do you know the one debt issue we don't hear from the government?
The debt truck!
Foreign debt has doubled under this government. And it will get worse if Telstra is sold. It will get worse because Australians will borrow money to buy Telstra shares. And where will this money come from? Since our net savings ration is minus 0.5 percent it will have to come from overseas. And private investors will be charged higher interest rates than the rates being charged on our government debt that the Telstra sale is supposed to pay off.
So our foreign debt will inevitably increase.
It will increase also because the Telstra sale will reduce our exports. Why will it reduce our exports? It will reduce our exports because selling Telstra will reduce our national competitiveness.
As a public company, Telstra has, one, had a responsibility to the Australian community to provide telephone services to all Australians; and, two, it has had a commitment to Australian jobs—both direct employment and indirect employment—through its support and development of secondary industries in Australia.
Our electronics industry has been built around servicing the needs of Telstra. Already we have seen a drop off in the local content that has been going from the telecommunications industry to the electronics industry since total deregulation occurred on 1 July 1996. We have seen our electronics industry grow to an industry that is worth about $1 billion a year, from an industry that was worth about $50 million some 10 years ago.
But that only represents a tenth of the expenditure that is occurring in electronics associated with telecommunications. There are a lot more opportunities that can be harvested for Australian companies and Australian businesses by them supplying to a publicly owned telecommunications operator.
Efficient telecommunications in all its facets, particularly with the new technologies that are around, are an integral component of business opportunity and business costs. There is no guarantee of the significant policy of purchasing locally in order to support Australian industry and the focus on small and medium sized businesses continuing if Telstra is fully privatised. Not only do the employees of Telstra lose, but many of those small and medium enterprises that have been built up around Telstra will also lose in terms of their providing significant employment opportunities.
Communications is integral to the development of our industries. It will become more and more critical as the factor which will determine the success or failure of many industries into the future. It will be the nature of their communications systems, how they use communications and how they are utilised as a tool to access markets.
Telstra's prices for its basic products have been going up, its performance has been deteriorating, its service in the network is deteriorating, jobs are being slashed, investment is being slashed and it is losing huge amounts of money in Asia. While all of these things have been occurring, in the most critical area of new technology for Australia and the Australian economy—namely, broadband—Telstra is letting Australia go backwards. We are now 19th in the OECD in terms of the number of broadband connections in households. We are way behind equivalent nations like Canada. We are 19th because Telstra has been dragging the chain.
Why? Because it is under virtually no pressure from its majority owner, the Australian government, to push hard to get broadband out to all Australians. It is so dominant in the marketplace that it is not under much competitive pressure within the market to do it, either. Because Telstra controls Foxtel, the main potential source of competition in broadband, it is able to protect itself from unwanted competition and ensure that its existing products, like ISDN, can be milked for all the revenue they can provide, even though they are outdated and do not deliver the kinds of speeds that Australians, and Australian small businesses in particular, will increasingly need.
According to the OECD, Telstra's R&D expenditure has fallen from 0.3 per cent of total revenue in 1997 to 0.1 per cent in 1999 to zero in 2001. Under Labor, Telstra was driving force in ICT research and product development, that is no longer the case.
Labor's position on these issues and on the future of Telstra is very clear. Not only do we oppose the privatisation of Telstra. We will return Telstra to its core responsibilities of delivering high-quality telecommunications services accessible for all Australians regardless of where they live or what their income level is, we will diminish Telstra's involvement in speculative foreign ventures and investments in sectors such as the media.
We will intensify the focus on the delivery of broadband services to ensure that Australia is leading the world in high-quality telecommunications access for our businesses as a crucial platform for Australian exporters and Australian businesses generally to be able to advance our economy, deliver jobs and deliver advanced services for all Australians.
We will ensure that Telstra is more strictly regulated and that there is a clear internal separation between Telstra's activities as the wholesaler, owner and manager of the network and its activities as a seller of telephone calls and communications capacity. This will establish a clear and genuinely competitive environment and a genuine level playing field between Telstra and its competitors as they use Telstra's network.
Finally, we will be introducing strengthened protections for telecommunications consumers in a range of areas that apply not only to Telstra but also to its competitors. Under Labor, Telstra will be a carrier, not a broadcaster. Telstra will be a builder, not a speculator.
Labor has been the only party to stand firm on this issue. We will not sell Telstra. We remain committed to opposing this legislation. I urge the minor parties—the Greens, the Democrats, the Independents and One Nation—to join us and to give voice to the overwhelming view of the Australian people that Telstra should not be sold.
If democracy means anything in this country, Telstra should remain in public ownership. It is still predominantly a public utility. It is still essentially a monopoly. It completely dominates the sector and it needs to remain in government ownership to ensure that all Australians continue to enjoy access to essential telecommunications services into the future.
Senator BUCKLAND —I seek leave to incorporate my own speech on the Telstra (Transition to Full Private Ownership) Bill 2003.
The speech read as follows—
The Telstra (Transition to Full Private Ownership) Bill 2003 repeals the provisions of the Telstra Corporation Act 1991 that require the Commonwealth to retain 50.1 percent of equity in Telstra, enabling Telstra to be fully privatised. Labor has always opposed the full privatisation of Telstra and we will continue to do so.
Why Labor opposes the full privatisation of Telstra is because we believe that telecommunications systems are essential services and essential services like Telstra must continue to be provided by the government. This is particularly important because of Australia's geography. We are disproportionately reliant on telecommunications as a public utility because of the vast distances between major centres. This issue of distance makes telecommunications vital to the social fabric of our nation as well as contributing to our economic performance. It is only through majority government ownership of Telstra that we can be sure that delivery of high quality telecommunications services to all Australians occurs.
We opposed the full privatisation of Telstra because we believe that a fully privatised Telstra would put profits and shareholder value before the interest of the consumers, especially in unprofitable rural and regional areas of Australia. We all know that private companies have a principal loyalty to their shareholders and not to their customers. Evidence received during an inquiry into this Bill suggested doubt over the government's ability to regulate a fully privatised Telstra.Maintaining majority public ownership of Telstra ensures protection of the public interest and also ensures accountability through the parliament.
We also oppose the full privatisation of Telstra because of our belief that continuing government ownership of Telstra has a beneficial effect on the Commonwealth budget. The Commonwealth budget is reliant on dividends generated by Telstra. The flow of this dividend stream would be terminated if Telstra were to be fully privatised and in turn there would be an adverse effect on future government revenues and budgets.
Labor Shadow Minister for Cabinet and Finance, Bob McMullan MP, estimates that the sale of Telstra based on conservative assumptions, would make the budget worse off by around $2.1 billion over the four-year period beginning 2005-06. Mr McMullan also suggested in his letter to the editor of the Australian Financial Review of 10 July 2003, that there are direct budget costs associated with selling Telstra such as:
Paying financial advisers;
Forgone Telstra dividends; and
Public debt interest savings
How can the government say to Australians that these are valid arguments to fully privatise Telstra.
Another reason we oppose the full privatisation of Telstra is because it will be harder to regulate once the Ministerial Power of direction, in the Telstra Corporation Act 1991 is removed. This Ministerial Power of direction is gone once government's share falls below 50 per cent. This is a very important reserve power for the Government to make sure that Telstra behaves in a way that best protects the national interest.
Once the government's equity in Telstra falls below 50 per cent, the government can no longer exercise its authority over Telstra on a range of Commonwealth Acts and Regulations.
Clearly a fully privatised Telstra will put shareholders first and the future employment security of employees will be threatened. The CEPU's submission to the inquiry into this Bill suggests that Telstra's staff and investment cutbacks under the Howard government and the resulting serious problems with Telstra's network will only get worse if Telstra is privatised. The CEPU documented Telstra's decline in staffing levels from 76,522 in 1996 to 37,169 in 2003. A loss of 39,353 jobs over 6½ years. The CEPU added that majority public ownership of Telstra would help ensure that Telstra behaves in a socially responsible manner. So it's for these and a raft of other reasons that Labor will continue to oppose fully privatised Telstra. Importantly, we believe that fully privatised Telstra will threaten employees' security, and we also believe those in regional and isolated areas will be grossly discriminated against.
A fully privatised Telstra will see public accountability through reporting as a thing of the past. Under this Bill, Telstra will no longer be subject to Freedom of Information Act. Only by keeping Telstra in public hands will we ensure Telstra is accountable to the people of Australia, through our parliament.
The Bill, if allowed to go through parliament will enable the government to sell Telstra when it suits them, regardless of whether the services provided by Telstra is up to scratch. Evidence presented to the Inquiry suggested that service standards have not actually improved sufficiently to warrant the sale of Telstra. It is also evident from the Inquiry and the Senate's Australian Telecommunications networks inquiry that services are below par in regional Australia. The National Farmers Federation (NFF) stated in its submission to the Inquiry into this Bill, that there was some way to go before Telstra's services are “up to scratch”.
Insert South Australian examples.
Mr Steve Olive of Bathurst, NSW, wrote to the Inquiry opposing the sale of Telstra. In his letter he stated that:
“When you sell Telstra off completely you will be creating Australia's Microsoft—a totally dominant organisation with little regard for community requirements or desire to support areas that don't drive high profit.”
A fully privatised Telstra would result in a huge private monopoly that would be too powerful for any government to effectively regulate. Telstra has the largest market share in fixed line, domestic long distance, international calls, mobile and internet access.
Insert South Australian examples.
Full privatisation raises genuine doubt as to whether regulators such as ACA and ACC who are trusted by the Australian people to prevent and regulate anti-competitive behaviour. Their monitoring and reporting role came under scrutiny during committee hearings into this Bill. The inquiry revealed that some of their reports on Telstra's performance were seriously misleading. For example the Network Reliability Framework `percentage of service without fault' and `percentage of service availability' figures released have passed off monthly averages as annual averages. As a result the government and Telstra was able to claim that Telstra's annual network reliability framework figures are above 99% which contradicts anecdotal and union evidence about poor Telstra network reliability levels. If ACA's effectives as a regulator preventing and redressing anti-competitive behaviour are in question before a fully privatised Telstra, this will be even more so if Telstra is fully privatised.
Labor believes that Telstra should remain a majority publicly owned company providing high quality telecommunications services available to all Australians regardless of where they live.
So in summary, the key points are:
Public accountability will cease to exist once Telstra is fully privatised.
Telstra will no longer be subject Freedom of Information Act and public accountability through reporting will be a thing of the past.
Similarly, if Telstra is privatised, the government can no longer exercise its authority over Telstra through a range of Commonwealth Acts and Regulations.
A fully privatised Telstra would become a huge and very powerful private monopoly too powerful for any government to try and regulate. It is more likely to be controlled from overseas.
The effectiveness of industry regulators in preventing and redressing anticompetitive behaviour will be put in doubt.
We must keep Telstra with majority government ownership because it is vital to the future of our country.
Senator BUCKLAND —I seek leave to incorporate Senator O'Brien's speech on the Telstra (Transition to Full Private Ownership) Bill 2003.
The speech read as follows—
Even the National party federal director Andrew Hall remains opposed to the full sale of Telstra until all the recommendations of the Esters inquiry are fully implemented.
But even implementation of recommendations from the government's own sham inquiry is proving difficult.
Mr Estens recommended the government ensure Telstra provides a minimum 19.2 kilo bytes per second data speed over Telstra's network for all Australians.
The government claimed it supported this very modest recommendation and would ensure that Telstra services met this benchmark.
But a close analysis of the licence conditions the government has imposed on Telstra reveals Telstra is only required to deliver this service on request.
It does not have to upgrade its whole network so all regional Australians can get this modest data capacity automatically.
This condition allows Telstra to avoid providing this minimum speed if prevented from doing so “by circumstances beyond its control”.
In reality, the Howard Government isn't prepared to guarantee this very basic data transfer speed to regional Australians.
It is not prepared even to implement the modest recommendations of its own sham inquiry.
And the Federal parliamentary wing of the National Party is mute!
At least the organisational wing has made its position clear—no sale until the Esters recommendations are implemented in full.
What a shame National Party representatives in the Parliament have not adopted the same position.
If anyone doubts the strength of opposition in regional Australia to the full sale of Telstra, I invite them to review the submission of the NSW Farmers' Association to the recent Senate inquiry into this Bill.
The Chair of the Association's Rural Affairs Committee, Mr Jim Graham, told the Committee that farmers in NSW oppose the privatisation of Telstra until services in the bush are comparable to those in the city.
In a statement, Mr Graham said:
“This legislation should not be passed by Parliament, because it doesn't address the real issues in the bush.”
Mr Graham pointed out that in a survey of NSW Farmers' Association members conducted last year, less than a third of those who responded were happy with telecommunications services in the bush.
According to a statement issued by the NSW Farmers' Association:
“Many country residents fear that a privately owned telecommunications carrier will neglect more remote areas that aren't as profitable when it comes to upgrading future technology.”
Labor understands rural and regional Australians' concerns about the sale of Telstra.
We recognise the widespread opposition to the sale outside the capital cities.
As a Labor Senator for Tasmania, and Shadow Minister for Primary Industries I recognise the opposition to the sale in my home state and among primary producers in all parts of the country.
I oppose—and will continue to oppose—the further sale of Telstra.
The Liberal Party is aware of the widespread opposition to this bill.
But it thinks the sham Esters inquiry is enough to fool the more gullible members of its Coalition partner, and `spin' about improved services will be enough to convince the Australian people to support the sale.
Regrettably, the Liberal Party is right about the former.
But it's got the second part dead wrong.
The National Party has rolled over on the full sale of Telstra—and sold out rural Australia—for a few seats at the Cabinet table.
And as the Member for Hume has previously recognised, the National Party positively jumps at the chance to sell out its constituency.
It is only the National Party's betrayal of its constituency on matters like Telstra that keeps the Coalition together.
It's certainly not merit that keeps the National Party in the Cabinet and outer Ministry.
If it did, the National Party would long ago have relinquished the Agriculture portfolio.
I can't believe that if a Liberal member of this government exercised portfolio responsibility for live exports the Cormo Express fiasco would have stretched for as long as 80 days.
You see, I don't support the Liberal Party's attitude to the sale of Telstra.
But at least the Liberal Party's ideological obsession with the sale is transparent, and Liberal Senators haven't tried to make anything other than a fleeting attempt to pretend the sale will assist rural and regional Australians.
That approach stands in stark contrast to the National Party Senators in this place who have given such painful presentations on the Telstra bill.
It's not expediency that keeps Mr Truss in the Cabinet—it's the shallow gene pool in the parliamentary National Party.
How frustrating this must be for more capable members of the government kept out of Cabinet by National Party deadwood.
Having said that, I imagine some junior Ministers—Senator Ian Macdonald, for example—get a double whammy.
Not just kept out of Cabinet but forced to front up to Question Time day after day with inadequate briefs from his more senior Minister.
The betrayal by the National Party of rural and regional Australians on Telstra is already complete.
The party has already voted for the full sale in the other place.
The Leader of the National Party in this place has already laid out the terms of his party's betrayal in this debate.
While it's small consolation to the National Party constituency, at least Senator Boswell had the courage to tell them in this debate why he is selling them out.
That courage stands in stark contrast to that of the deputy Prime Minister, Mr Anderson, who failed to contribute to the debate on this bill in the other place.
Senator Boswell is not a bad bloke.
He represents most of the values that used to make the National Party an important contributor to the policy debate in this country.
And he alone amongst his National Party colleagues sought to articulate during this debate a basis on which his party had betrayed its constituency on the sale of Telstra.
Given his unquestioned personal integrity, I'm a little disappointed Senator Boswell trotted out the hoary old chestnut about proceeds of the sale being directed to regional infrastructure.
I've already commented on the fact that the National Party has such little standing around the Cabinet table that any promise it could extract a financial boost for regional Australia from the sale of Telstra is pure bunkum.
It is, I suppose, understandable that Senator Boswell has run this argument and, given his uncomplicated view of the budgetary process, there is a chance he believes it.
The problem for Senator Boswell and the National Party is that nobody else does.
The Finance Department has confirmed that spending the Telstra sale proceeds on infrastructure would worsen the Budget balance.
I'm sure Senator Minchin, who is listed to follow me in this debate, will be happy to confirm this fact.
The Finance Department has also confirmed it is government policy to spend any Telstra sale proceeds on reducing Government debt.
As I said earlier, the National Party supported the direction of Telstra sale proceeds to expenditure at its recent national conference.
But at that conference, Mr Anderson forgot to tell his party that the government can't spend the proceeds without sending the budget spiralling into deficit.
He also forgot to tell them that his own government's policy was to spend the Telstra sale proceeds on debt reduction.
This Bill has the full support of the National Party in both Houses of the Parliament.
Earlier in this second reading debate Senator McGauran said the National Party would not support the sale of Telstra until bush services were up to scratch.
I remind Senator McGauran that that is not what the bill provides.
In fact, should the Senate give passage to this bill against the trenchant opposition of Labor, no such precondition will exist for sale except—perhaps—in the mind of Senator McGauran.
I would never suggest Senator McGauran would mislead the chamber, so the only conclusion I can draw is that he hasn't read the bill.
If enacted, the bill would allow the sale of Telstra at anytime.
This probably doesn't matter much to Senator McGauran, because the telephone services at the Paris end of Collins Street are, I understand, excellent.
But it matters a hell of a lot to the rural and regional Victorians the National Party has sold out.
Senator Boswell, whose telephone services in the City of Brisbane are also excellent, will similarly vote to leave rural and regional Queenslanders behind.
But what of Mr Truss?
Not only did he fail to speak in the debate on this bill in the other place—he has failed to utter the word “Telstra” in the other place all year.
While he dutifully responded to the Liberal Party whip and voted for the bill, Mr Truss still has an opportunity to take a stand on behalf of his Wide Bay constituents and Australian farmers.
The Agriculture Minister will attend the Queensland Central Committee of the National Party this weekend.
He has a chance to tell his rank and file members why he voted in defiance of his branch's demand that Telstra not be privatised.
I await the outcome of the Queensland conference with interest.
Mr President, Labor opposes the full privatisation of Telstra. We oppose the passage of this bill.