Senator MACKAY (8:14 PM) —Mr Acting Deputy President Cherry, I admit to being a bit puzzled about why we are here debating the Telstra (Transition to Full Private Ownership) Bill 2003 [No. 2] today. I did listen with great interest to your contribution earlier and I must say I concur entirely with your analysis. Further, I note what a waste of chamber time this is when we have a whole lot of legislation on the agenda. I am also puzzled for another reason: to be talking about selling Telstra must mean that the government has ensured that telecommunications services in rural and regional Australia are, to quote the Prime Minister, up to scratch. They must be. Why else bring it back on? The government promised the Australian people that it would not proceed with the full privatisation of Telstra until service standards improved—until services were `future proofed', to use the government's term—and it had ensured that rural and regional Australians would not be relegated to receiving second-class services into the future. The fact that we are here debating the full sale of Telstra must mean that all this has been achieved.

Senator O'Brien —Or it's a non-core promise.

Senator MACKAY —That is right: or it is a non-core promise, because this government is always true to its word. The government claims it has a mandate to sell Telstra as a result of the last election campaign. It does not. The policy that the government took to the last election was that it would not sell Telstra until services were up to scratch. This government would never play fast and loose with the truth, would it? For the purposes of Hansard, that is called irony. I would like to believe that. I would like to believe that this government and Telstra have had an epiphany, that they have seen the light, that they have had a damascene revelation and that they are now genuinely committed to improving standards, to fixing the disintegrating fixed line network, to providing adequate mobile coverage and to ensuring the availability of high-speed, reliable Internet access. But I am afraid I just do not believe it. I do not trust this government. I do not believe that this arrogant, ideologically driven government—or, to use the words of Shane Stone, this mean, tricky and out of touch government—will do what they say.

Nor do I believe Telstra, an organisation that is beginning to reflect the values of this government. Telstra is another arm of the government these days, as far as I am concerned. It is an organisation that is showing contempt for the Australian people, an organisation whose chief, Ziggy Switkowski, has not once deigned to appear at Senate estimates, the mechanism through which Telstra is accountable to the Australian people. He has not appeared once at estimates and yet he managed to appear as a guest speaker at a $600-a-plate fundraising breakfast for the Treasurer, Mr Costello.

I do not believe the government because I know, as every Australian knows, that Telstra's services are far from being up to scratch. I have seen with my own eyes the cables wrapped in tape and plastic bags. I have driven less than half an hour from Hobart, the capital of my home state of Tasmania, and not been able to get mobile phone reception. I have spoken with constituents who are frustrated about the slow dial-up Internet speeds and inadequate broadband access. I have seen the documents that Telstra and the government do not want us to see—the fault documents and the leaked document released by shadow minister Lindsay Tanner the other day that showed that Telstra is all too aware that it is presiding over a decaying network and is doing little to fix it.

I have seen Telstra decimate its work force, sacking the workers who were employed to keep the network in a state of good repair and cutting back its capital expenditure budget, leaving a dilapidated network simply unable to cope. From the financial years 1999-2000 to 2002-03, according to Telstra's own figures, full-time employment has fallen from 50,761 to 37,169 whilst capital expenditure has dropped from $4.5 billion to $3.4 billion. At the same time I have seen Telstra blow huge amounts of money on overseas investments, with write-offs of billions of dollars the end result. I have watched with disbelief as its plans to buy Fairfax were revealed, followed by the overpriced acquisition of the Trading Post.

Then as recently as last Friday I read in the Australian that the Telstra board members plan to all fly first class to London, at $14,000 a head, for their May meeting. I understand this has been put off because of the unavailability of some of the members. I am sure that the people of Australia will be relieved to know, however, that the trip has only been postponed until some date in the first half of the year and that the board members will get the opportunity to `observe technological best practice in the telecommunications industry'. I guess the fact that the Telstra board feels it needs to fly to England to see best practice in operation says something, doesn't it?

Telstra has taken its eye off its core business, the business of delivering high-quality telecommunication services to all Australians. Telecommunication services are vital to the life of this nation. Labor are committed to retaining majority public ownership because we know that without it we can say goodbye to high-quality, equitable access to those vital services. We only have to look at recent events to know that there is no hope for rural and regional Australia under a privatised Telstra.

We discovered last Wednesday, again courtesy of shadow minister Lindsay Tanner, that the government was secretly planning a $3 million pre-election media campaign to try to con rural and regional Australians into believing that Telstra should be sold. So weak are the government's arguments that this campaign would have seen the government in effect bribing regional papers to run its lines. The plan, it seems, was for the government to pay for full page ads in exchange for stories based on information from the communications department.

Senator O'Brien —More cash for comment.

Senator MACKAY —Yes, indeed. The government would not have to consider this appalling misuse of taxpayers' funds if it simply ensured that Telstra lived up to its obligations. As I have said, the government promised not to sell Telstra until services in regional and rural Australia were `up to scratch'. So let us have a look at this bill before us to see what guarantees there are for rural and regional Australians, who may not be prepared to simply take the government at its word. Surprise, surprise, there are none. This bill contains no caveat that Telstra cannot be sold until regional services are up to scratch. If this bill is passed Telstra can be sold at any time of the government's choosing. Rural and regional Australians will have to trust the government. They will have to trust the Prime Minister, the Treasurer and the finance minister to put the interests of the regions ahead of a fist full of dollars to spend on debt reduction.

Let me make this absolutely clear: the government have said again and again that the Telstra sale proceeds will go on debt reduction. The Treasurer has said that and Senator Minchin has said that. But nobody else seems to recall that from the other side of the chamber. It is the Howard government's policy, and they have repeated this every time they have been asked outright, that the sale proceeds will be used to retire debt. It will be spent on debt reduction because to do anything else, Mr Costello tells us, would send the budget into deficit. That is true. Yet we had the spectacle of Minister Anderson, the Deputy Prime Minister and Leader of the National Party, allowing phoney debates to take place at National Party conferences about how the cash is going to be spent. So The Nationals need to be honest with themselves and their constituents about that.

Senator MACKAY —I know, it is a big call, isn't it, Senator O'Brien. Senators from the minor parties and Independent senators need to recognise that there will be no buckets of cash for rural and regional infrastructure and there will be no buckets of cash for the environment; there will be a one-off repayment of debt and a forgoing forevermore of the revenue that is returned to the Australian people by virtue of their majority ownership of Telstra. So, to recap, this bill contains no provisions to delay the sale until the services are `up to scratch', whatever that actually means. We must rely on the government to determine when that might be. That is a bit of a worry I think—call me crazy.

The Prime Minister, speaking with Libby Price on ABC radio on 8 November 2002, when the Estens report was about to be released, said:

He went on to say, and I think these are very important quotes in the context of this debate:

It is those words, I believe, that should have set alarm bells ringing around the country, particularly in rural and regional Australia, because the Prime Minister was admitting that he would not necessarily wait until services were up to scratch—that it would depend on a reasonable test of that. And on whom are we supposed to rely for that `reasonable test', to use the Prime Minister's terms? Surely not the Australian Communications Authority, the so-called communications watchdog, who admitted to me in Senate estimates last October that their published figures on Telstra's faults were misleading. Perhaps they were not deliberately misleading, but they were misleading nonetheless. Perhaps, again, we will just have to trust the government on this one.

The Prime Minister's last few words in that interview on ABC radio were the most chilling. Let me repeat them. He said:

By `look at the whole picture' the Prime Minister is saying that we have to weigh up what is in the government's best interests regarding the timing of a sale and what may be in rural and regional Australia's best interests regarding service standards. I know, in terms of the form of this government, which way the scales will tip.

In my role as deputy chair of the communications legislation committee, I took part in the inquiry into this bill—together with you, Mr Acting Deputy President, and Senator Eggleston, who I note is in the chamber too. We received over 150 submissions from all around the country. Only six of those, you would recall, were in favour of the bill. One of those was from the government—quelle surprise!—one was from Telstra, and there is no shock there; two were from investment banks who stand to profit hugely from the sale of Telstra; and only two were from truly disinterested parties. We also travelled around the country, at least to those parts of the country the government would allow us to visit—you would recall that debate—and heard first-hand the evidence about how sorely lacking services are. Even the Deputy Prime Minister's friend Dick Estens, of the Estens inquiry, effectively admitted in the Dubbo hearing that regional services were not up to scratch. That was on 1 October.

Twenty-nine days later, the government—and that includes The Nationals—voted in the Senate to pass this bill. The Nationals voted to sell out rural and regional Australia, and the government did the same. I should point out here that the Tasmanian Liberal senators were complicit in that as well. That is the arrogance of this government: they get clear and detailed evidence that services are substandard and then, despite the Prime Minister's promises to the contrary, turn around less than a month later and vote to sell off Telstra, guaranteeing that those services will never improve and condemning rural and regional Australia to receiving second-rate access to telecommunication services forevermore. Fortunately for rural and regional Australia, Labor, the minor parties and the Independents did not sell them out and the bill did not pass the Senate. So what did the government do? As you pointed out, Mr Acting Deputy President, they simply waited a couple of months and brought back exactly the same bill. Such arrogance from a completely out of touch, tired and lazy government.

Let me have a brief look at what else this bill allegedly offers those in rural and regional Australia. The government claim that, in this bill, they provide some guarantees of service levels in the regions. The provision exists for an optional regional licence condition, the terms of which are entirely at the discretion of the minister. When my colleague Senator Lundy asked at our hearing whether this could theoretically consist of a Telstra shop in Gundagai and one technician in Kalgoorlie—in terms of fulfilling the provision for Western Australia—the official from the department of communications told her that, yes, it could. That is not much of a guarantee in respect of presence. The reality is that this bill provides no prescribed regional service standards at all. Once again, the government are asking us to trust them on this.

I do not have to rely on anybody's instinct to know we cannot trust the government on this one. We only have to look at what happened with the Estens report recommendation that a minimum of 19.2 kilobits per second Internet speed be guaranteed to all Australians. Dick Estens himself has since admitted that this speed is no longer adequate—and good on him for doing that. But, even given the less than adequate initial recommendation, the government have still failed to act. The government made much of how they would respond to this and other Estens recommendations in full. But as it turns out, all the government have done is ensure that Telstra has to provide this speed if requested, and only then if it is not prevented from doing so by circumstances beyond its control. What are they? Could they be that the customer choses to live in a rural or remote area perhaps? Would that count as circumstances beyond its control? This condition is an absolute joke. It is double jeopardy: you need to know to ask and then, even when you do ask, there is no guarantee you shall be given. The government roll over to Telstra yet again.

That brings me to the final of the so-called protections for rural and regional Australia contained in this bill—the five-yearly review of regional services by a committee to be appointed by the minister, a committee of the minister's mates with no obligation for the minister or Telstra to act on any recommendations even assuming that the minister's mates would make any recommendation. That is another joke, I believe, being perpetrated by this government. These are just some of the reasons why Labor will not be supporting this bill. I will not be supporting it because I am not prepared on behalf of rural and regional Australia and my home state of Tasmania to take this government on trust. I will not be supporting it because the government cannot be trusted, as this bill shows. Even where there are supposedly guarantees for rural and regional Australia, the government has yet again played mean and tricky and those guarantees are not worth the paper they are not written on. Even if I and the Labor Party were prepared to countenance the idea that we may all be better off with a giant private monopoly delivering telecommunications services in this country, I would not be able to support the bill in this form and neither would Labor. At the end of the day I do not believe that Telstra should be fully privatised. I believe that it is only by retaining Telstra in majority public ownership that Telstra will be forced to focus on delivering high-quality and equitable services for all Australians. If we pass this bill we give up public scrutiny and accountability at our peril. I oppose the bill, as does Labor.