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Tuesday, 17 February 1987
Page: 69

(Question No. 4737)

Mr Price asked the Minister for Communications, upon notice, on 8 October 1986:

(1) Has the Government established a target for Australian industry participation in the $1000m contract to lay a laser communications cable from Australia across the Pacific; if so, what is it.

(2) To what extent will any decision on the successful tenderer be approved by the relevant Minister or Cabinet.

(3) In the tender evaluation has any weighting been given to Australian-owned industry.

(4) Is Australia the third largest owner and investor of submarine cables in the world.

(5) Where does Australia rank as a manufacturer of submarine cable.

(6) What role will the Minister for Industry, Technology and Commerce have in the tender process.

Mr Duffy —The following answer to the honourable member's question is based on information provided by the Overseas Telecommunications Commission (OTC):

(1) The Government, through OTC, plans to use the opportunity created by Australia's participation in the proposed optical fibre Pacific telecommunications cable network to promote the establishment of a local fibre submarine cable industry that is competitive on world markets. Initiatives taken by OTC include:

Placement of contracts for research and development studies on optical fibre systems with Australian industry.

Early announcement of the full scope of the proposed network at industry briefing in May 1986.

Insistence that all tenders include at least one offer for local submarine cable production.

Inclusion in the timetable of a period up to one year for the successful tenderer to prove his capability to produce the cable before commencing full scale production.

The scheduling of the trans-Tasman and follow on cables to allow continuity of local cable production.

(2) OTC's plans for the cable network will be submitted to the Government before the end of the year. Under Section 38 of the Overseas Telecommunications Act 1946 the Minister has to approve contracts in excess of $2 million.

(3) Tenders for the first phase of the project between Australia and New Zealand do not close until June 1987. OTC complies fully with the Government's Preference Policy and its Offsets Policy, and will be seeking the lowest cost technically compliant solution consistent with those Policies.

(4) Yes. At the present time Australia ranks only after the United States and the United Kingdom in terms of owned mileage of submarine cables.

(5) To date Australian manufacturing has been limited to the supply of repeaters, terminal equipment and processed materials for submarine cable systems. The only countries manufacturing complete submarine cable systems are the United Kingdom, the United States, France and Japan. The initiatives taken by OTC aim to substantially improve local manufacturing capability and to foster a viable submarine cable industry.

(6) The Minister for Industry, Technology and Commerce has been strongly supportive of initiatives taken to date. Prior to contract execution the preferred tenderers will be required to satisfy the Department of Industry, Technology and Commerce that their proposal fully meets the Government's Offsets Program and is consistent with the industry development objectives.