Senator BUCKLAND (8:31 PM) —I too rise to speak on the Telstra (Transition to Full Private Ownership) Bill 2003 [No. 2]. Labor has always opposed the full privatisation of Telstra and will continue to do so. The bill repeals provisions of the Telstra Corporation Act 1991 that requires the Commonwealth to retain 50.1 per cent of equity in Telstra, and that then, of course, would enable Telstra to be fully privatised.

Labor oppose the full privatisation of Telstra because we believe that telecommunications systems are essential services, and essential services like Telstra must continue to be provided by the government—not by a contractor, not by a private company, but 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 that Telstra can be sure that it delivers a high-quality telecommunications service to the Australian people.

If you go to the remote areas of South Australia, as I often do—and we hear that others do but they do not seem to come back with the story of the people—and if you visit places like the northern Flinders Ranges or the Oodnadatta Track or north of Coober Pedy or to the West Coast and the Eyre Peninsula or if you go to the Yorke Peninsula or the south-east of the Mallee or the mid-north of South Australia, you consistently get told that they were under the illusion that all of their service needs would be provided before this sale was to go through. It was an illusion. The services and repairs they were promised when breakdowns occurred would have been provided by now if the government had been serious. They were not serious and they misled the people into believing that this was the right thing to do. To privatise this very important service that we have is the wrong thing to do.

When The Nationals come back to report in the Senate that they are happy with the deal, it is hard to understand where they are getting that information from. They are certainly not getting it from the bush. The people in the bush are very clearly saying, `We do not want to sell Telstra.' That may be the view of South Australia where we do not have The Nationals, apart from a state member, but I cannot imagine those in outback Queensland or outback New South Wales or Victoria being any different. They too fear what the government is doing with this bill.

We oppose the full privatisation of Telstra because Labor believe that a fully privatised organisation would put profits and shareholders far and above the interests of the consumers, especially in unprofitable rural and regional areas of Australia. And that must be right because every business does that and we understand that. Business operates on profit for its shareholders: it does not worry about the consumer as long as the money is coming in. So why would a privatised Telstra worry about the few in the bush when they are getting the majority of their profit from city based consumers? Indeed, they would not even be providing services to those folk in the bush.

We all know that private companies have the very high principle of loyalty to their shareholders, not their customers; we have seen that time and time again. When a company goes bad, it is the customer that suffers first. Evidence received during an inquiry into the further sale of 50.1 per cent of Telstra suggested doubt over the government's ability to regulate a fully privatised Telstra. Maintaining majority public ownership of the company ensures protection of the public interest and also ensures accountability through the parliament.

We also oppose full privatisation because of our belief that continuing government ownership has a beneficial effect on the Commonwealth budget. The Commonwealth budget is reliant on dividends generated by Telstra. The flow of the 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. We have already heard Senator Mackay say that the government have made it very clear that they intend to retire debt with the money raised through the sale. It is estimated that the sale of Telstra, based on conservative assumptions—I did this work on this particular bill some time ago, but these are conservative assumptions—would make the budget worse off by more $2.1 billion over the four-year period beginning 2005-06. It is also suggested that there are direct budget costs associated with selling Telstra such as: paying financial advisers, and we have heard about that; forgone Telstra dividends; and public debt interest savings. How can the government say to Australians that there are valid arguments to fully privatise Telstra? There are no valid arguments, and that is why Labor will keep control of Telstra.

Another reason we oppose full privatisation is that it will be harder to regulate Telstra once the ministerial power of direction in the Telstra Corporation Act 1991 is removed. The ministerial power of direction is gone once the 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 nation's interests—not their own, not the company's and not the shareholders' but the national and the public 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. This government keeps pretending it has, and keeps lecturing the Labor Party on, a commitment to working people and employment; it is all a sham as it has no interest, because this bill will threaten the livelihood of many. The CEPU's submission to the inquiry into the 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. It is no good getting up and saying, `They all got picked up by contractors,' as that is nonsense. That did not happen; there is absolutely no proof of that happening. In fact, there is no anecdotal or real demonstration that the government had any intention of those people being picked up, nor was there any intention by those who took over the contracts of taking on people who were former Telstra employees. That is why we have people employed by Telstra on the west coast of South Australia going into the Northern Territory, Western Australia and New South Wales—and no doubt coming the other way as well—to service clients' needs. The CEPU added that majority public ownership of Telstra would help ensure that Telstra behaves in a socially responsible manner. It is important that we have this organisation which is looking after the bulk of our telecommunications needs. That includes things like the Internet, broadband and other services of that nature that I am not sufficiently technically minded to test my hand on, but I do know that it provides all of those services.

Senator Forshaw —Give it a go!

Senator BUCKLAND —I could, and I would outdo the government on my knowledge, but I will not do that. It is clear that this government does not have the interests of the public at heart. Real social responsibility goes the day that the government hands over the key, which it is so interested in doing. So it is for these reasons and a raft of others that Labor will continue to oppose a fully privatised Telstra. Importantly, we believe that a fully privatised Telstra will threaten employee security. For some of us, it means a lot that there is employee security, that people have a job to go to—not a part-time job, not a casual job but a job that is there each day that they go through the front gate. These people travel vast distances in remote locations, out of contact with others for many hours, to help us keep in contact with each other, and everyone in this chamber benefits from that probably on an hourly basis.

A fully privatised Telstra will see public accountability through reporting become a thing of the past. Under this bill, Telstra will no longer be subject to the 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 are up to scratch—the services it promised would be up to scratch before the sale. And, clearly, they are not up to scratch now. There was evidence presented to that inquiry suggesting that service standards have not improved sufficiently to warrant the sale of Telstra. It is also evident from the inquiry and the Senate's Australian telecommunications network inquiry that services are below par in regional Australia. It is fairly important to understand that because it is in regional Australia where you have isolation that you rely more heavily on these services than in other centres. The National Farmers Federation stated in its submission to the inquiry into this bill that there was some way to go before Telstra services are `up to scratch'. Their position has not changed. Quite frankly, services are worse.

Look at the situation we have now in the Riverland where the large Greek community relies on Telstra to provide for them by relay on Sundays their Greek devotional services for free. At the end of the month I understand that they are going to have to come up with some $7,000 to continue that service. That is going to be hard if they cannot come to some arrangement. What happens when it is privatised? That will be the end of this very important community service. It cannot be conceived that a private company would be prepared to provide this valuable service without full payment. They are already being asked to pay $7,000 or more. It is going to be more under a privatised provider.

I was interested to read in the report a letter that Mr Steve Olive of Bathurst in New South Wales wrote to the inquiry opposing the sale of Telstra. In his letter he stated:

We read regularly about Microsoft. As I say, I am not able to say much about the technology of computers or that sort of thing but I do have a son who works in the industry and by listening to him I can pick up some words. I know that companies like Microsoft have set themselves up to become governments in exile—certainly in the revenue raising area. They pride themselves on that. 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.

Full privatisation raises genuine doubts as to whether regulators such as the ACA and ACC, who are trusted by the Australian people, will be able to prevent and regulate anticompetitive 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. And the public is being seriously misled by the government in what it is saying are the reasons for wanting to sell. For example, the network reliability framework `percentage of service without fault' and `percentage of service availability' figures that have been released have passed off monthly averages as annual averages—somewhat misleading. As a result, the government and Telstra were able to claim that Telstra's annual network reliability framework figures are above 99 per cent, which contradicts anecdotal and union evidence about poor Telstra network reliability levels. If ACA's effectiveness as a regulator preventing and redressing anticompetitive behaviour is in question before a fully privatised Telstra, it 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 to Australia for all Australians regardless of where they live. For those reasons, I, with Labor, strongly oppose the further sale of Telstra.