Senator CONROY (2:00 PM) —My question is to Senator Coonan, the Minister for Communications, Information Technology and the Arts. I refer the Minister to Telstra’s announcement today of an annual profit of $4.45 billion, the largest in Australian corporate history. Can the minister confirm that Telstra’s line rental revenue increased by $125 million last year as a result of the massive cost increases that the government has permitted under its weak price control regime? Can the minister also confirm that Telstra’s broadband revenues increased by 73 per cent, or $307 million, and that this reflects the fact that the prices paid by Australian consumers for internet access are among the highest in OECD countries? In the light of these results, does the minister accept that Telstra’s profits have been driven by the excessively high prices that Telstra has been charging Australian consumers for its services? When will the government stop focusing on fattening up Telstra for sale and take action to strengthen the competition regime to deliver lower prices for consumers of telecommunications services?

The PRESIDENT —Order! Before I call Senator Coonan, I remind senators that some questions tend to be a bit long. That one was rather elongated.

Senator COONAN (Minister for Communications, Information Technology and the Arts) —I thank Senator Conroy for the question. What I think Senator Conroy has failed to understand in his question is that the price control regime does not apply to non-regulated services; it applies only to services that are actually covered under the universal service obligation. Obviously broadband does not come under the price control regime, but the price control regime has in fact continued to deliver services and untimed local calls for Australians and will continue to do so. As the Senate may be aware, I recently rolled over the existing price control regime until December so that further price controls can be announced as part of a number of matters under consideration going forward.

As to the matter of competition, I am glad that Senator Conroy mentioned that, because competition is obviously a fundamental plank of what this government regards as essential to telecommunications. Since we have come into government we have found that a robust telecommunication regime has meant that the telecommunications industry has gone from the cosy duopoly of Telstra and Optus, under Labor, to over 100 telecommunications providers. The economy is about $10 billion larger than it would have been had the government not proceeded down this track. It has provided about another $2 billion for small business and about 30,000 employees.

Competition in this country is a very big success story, but of course it is uneven. In a country as broad as Australia and with the other geographical and population centre issues that Australia has, obviously competition does not roll out evenly. That is why, apart from having some specific guarantees for basic services, this government has spent in the order of over a billion dollars to ensure that people in underserved areas, where competition is not yet developed, will get services—indeed, the services that they want at the moment: broadband and faster internet access. Competition is something that this government says is very much a work in progress and is trending precisely in the right direction.

It is amusing to hear Senator Conroy talk about competition on the one hand and owning Telstra on the other hand. A fundamental plank—in fact, it is probably the only plank—of Labor’s approach to telecommunications, as far as I understand it, is that the government should continue to retain its majority ownership in Telstra. It is a very interesting question. If Senator Conroy is so interested in competition, how can the government continue to own the dominant carrier and at the same time provide sufficient competition to provide all the services that are needed in rural and regional Australia? It is an absolute nonsense that this government has recognised. We know that with targeted investment you can assist in getting people the services they need in rural and regional Australia.

It is very interesting when you think back on Labor’s record on privatisation. I am just reminded about Qantas, the Commonwealth Bank, CSL and Australian Airlines. What is it about Telstra that so frightens the Labor Party? They were prepared to privatise one out of two national airlines and one out of four major banks, yet they cringe at and are scared of privatising one out of 100 telecommunications companies.

Senator CONROY —Mr President, I ask a supplementary question. Does the minister agree with Mr Trujillo’s reported comments yesterday, when he told Telstra’s board that Australia’s communications platform was lagging well behind those of other developed countries and that Australia lagged behind its international peers in terms of investment, the take-up of broadband services, pricing and capacity? He said that the nation was in the bottom quartile of developed countries. Does the minister accept that the level of profit revealed today reflects Telstra’s excessive market power? Will the minister now commit to accepting the ACCC’s recommendations on Telstra’s future price control arrangements and strengthen regulation to prevent consumers from being gouged by Telstra’s monopolistic prices?

Senator COONAN (Minister for Communications, Information Technology and the Arts) —What this government will impose is an appropriate amount of regulation not only on Telstra but also on all telecommunications providers. But certain questions still remain for the Labor Party to answer. If you need to own Telstra to regulate it, how are you going to regulate Optus? How are you going to regulate AAPT? How are you going to regulate Vodafone? The ALP needs to get its concepts straight and stop trying to hang on to—

Opposition senators interjecting—

The PRESIDENT —Order! How can anybody answer a question with that racket on my left going on?

Senator COONAN —The Labor Party should stop trying to hang on to outmoded concepts of what is needed to deliver telecommunications in this country. Mr Trujillo’s comments in relation to Australia’s position on the league table related to broadband, as I understand it. That was precisely what they related to. Of course, the latest OECD broadband figures confirm that Australia is now one of the top countries in terms of taking up broadband—(time expired)