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Monday, 28 February 2011
Page: 1649


Mr RAMSEY (7:47 PM) —I too rise to address the National Broadband Network Companies Bill 2010 and the cognate Telecommunications Legislation Amendment (National Broadband Network Measures—Access Arrangements) Bill 2010. However, I must take the member for Robertson to task about the trap that this government continually falls into where it paints any opposition to a particular method of policy implementation as opposition to the whole premise. In this particular case, the fact that the opposition are opposed to the National Broadband Network in its current form does not mean we are against high broadband speeds. The member for Robertson said that we must build the backbone; well, we agree with that. We must build the arteries and veins that will allow for high-speed backhaul. But that does not mean we need the capillaries. Of course, we will never quite know whether we in the opposition or the government are right in this case, because the government refuse to have a cost-benefit analysis to discover just what the right answer is.

I recognise the need for all Australians to enjoy access to a world-class internet. It is critical to our nation’s growth and competitiveness in the world market—although at times we can forget just how much telecommunications in Australia have changed in a relatively short time. You could be forgiven for thinking the government believe that, prior to their coming to power, we had been stuck in a time warp, using Marconi radios and carrier pigeons to communicate with each other, when in fact the changes in the telecommunications industry have been quite enormous over the last 20 years or so. Twenty years ago, we barely had mobile phones. Ten years before that, we did not have fax machines. Advances are both inevitable and inexorable.

I also deplore the government speakers who insinuate that those who do not support their version of broadband do not understand the technology or seek to deny Australians access to the technology. However, it is becoming increasingly obvious that there are a large group of industry experts who do not believe that a fixed line NBN delivered to the premise is the right answer for Australia and that the tertiary part of the network—that is, the fibre from the local exchange to the house—is likely to be superseded before it is completed. The great unknown is whether the projections for NBN take-up will ever be reached, considering Australia’s love affair with wireless technology. The NBN business plan predicts that, in 2025, 16.3 per cent of homes will be wireless only. I would be surprised if those figures did not prove to be very conservative. I am sure, Mr Deputy Speaker, that like me you are well aware of many households that do not have fixed line services now. In fact, it has been one of the main contributing factors to Telstra’s declining profits in fixed line services. The advent of superfast wireless broadband services, which will come in the next few years with the rollout of 4G services, will accelerate this abandonment of fixed line services, no matter how good they are. Indeed, we are informed that in the US 26.6 per cent of homes are already wireless only. I have not heard a cogent argument which would suggest we are not likely to follow this trend.

If that rate of leakage to wireless is repeated in Australia, the foundations of the NBN business plan will be under serious threat. Already considered an unbankable financial risk for private enterprise, the biggest financial commitment in Australia’s history would become the biggest white elephant in Australia’s history. I will return later to a few of these issues, but I will deal now with the proposed legislation and touch on the amendments to be moved by the member for Wentworth.

Certainly, if we are to have a monopoly, government owned NBN, then some of the legislative proposals are necessary and desirable. There is of course an alternative point of view which questions whether we as a nation want to return to a monopolised telecommunications network and whether it will be or even can be responsive to new challenges and technologies—or will it, as we have seen in the past, be a monopoly committed to the past because they control all the current networks? After all, why would an entity drive change when they have 100 per cent of the business and there is no scope for gain in market share? This legislation addresses some of the concerns of the industry and attempts to confine the NBN to a wholesale operation only. Unfortunately, it is this part of the legislation that also snuffs out the ability of any other organisation to build any part of its own network. This, of course, is the basis of a legislated monopoly.

It will be illegal for anyone to try and compete against this network. It will be illegal to offer a superior service and it will be illegal to offer a cheaper service. It hardly seems like a free country, and I predict a government somewhere in the future will attempt to break open this monopoly, although it is unlikely to be in the near future. It is likely to happen if and when the monopoly is seen to be dragging its heels on delivering new technology.

So, while there is good reason to make sure the NBN does not get involved in retail and uses what will be enormous market strength against competitors, it is harder to maintain an argument that no-one should be able to try and pick up a slice of the transmission market if they wish, which is the intent of these bills, insofar as any network built after 25 November last year capable of carrying more than 25 megabits per second will have to allow access to other parties. There is little chance under this legislation that anyone would ever be prepared to build a competing network.

Perhaps the most objectionable part of these bills is the only too obvious effort to completely remove the greatest single expenditure in Australia’s history, more than $50 billion, from public scrutiny. The move to neither list the NBN as public works nor make the company a public authority does just this. This move should be roundly condemned. What right does a government have to seek to avoid public scrutiny of the biggest single program in Australia’s history?

The very fact that the government understate the total expenditure on this project by refusing to include the $11 billion which they will have to pay to Telstra for access to their conduits and pipes and for transferring their customers across from the copper network they own to a network they do not own is one of the things that highlights the government’s intention to hide this from public scrutiny. It is in fact a dishonest representation of the facts by the government and I am concerned that the $37 billion figure used by the government has gained traction in the media. At the very least, the government should be honest about the true cost of this monument to their stubbornness.

To compound this lack of honesty, we know also that this enormous expenditure is off-budget, and while technically that is defensible it is yet another method the government are using to hide from the public the impact of the reckless spend, spend, spend policy they have employed since they came to office. Despite repeated assurances that they were fiscal conservatives—remember that one—that they were committed to surpluses and that they would protect the savings of the Future Fund, the government continue to spend and are driving Australia inexorably towards $90 billion of debt. And remember that figure does not include the NBN. The government continue to borrow $100 million a day to stimulate an economy which suffered a setback two years ago and is beginning to face labour shortages. So attempts to hide from the public the operations of the NBN should be resisted at every opportunity. I will be supporting the member for Wentworth’s amendments, which are aimed at addressing this travesty.

This brings me to some specific issues surrounding the NBN and its rollout. I return to the justification for building a network of such epic proportions in a global sense. I said earlier that industry experts are coming out and questioning the wisdom of this $50 billion extravagance. We should remember the words of telecommunications king and the world’s richest man, Carlos Slim Helu, in September last year, when he visited Australia to address the Forbes Global CEO Conference in Sydney. He said:

It’s too much money. It is not necessary to invest so much money, because technology is changing all the time.

He also criticised the reliance of the project on fibre, emphasising the need for a wireless service and stating that $7,000 a home to connect about six million homes was too expensive. Mr Helu went on to say:

You need to have a multi platform of everything; mobile, landline, fibre, cable and copper.

Recently, President Obama laid out plans to supply 98 per cent of US households with high-speed broadband within five years. As a stark comparison, the US will be using a multiplatform approach with a high reliance on wireless broadband. Already more than 110 million people are receiving fast broadband services courtesy of 4G wireless and using either Wi-Max or LTE technologies. Speeds of up to 100 megabytes per second are being achieved, which is as fast as the initial speeds promised by the NBN. Even more importantly, speeds up to one gigabyte have been achieved in trials; the same speeds the NBN hopes to achieve.

The great question remains: will Australians sign on? Certainly the experience from Tasmania at this stage is less than encouraging. I and every other member in this place will know of many, particularly in the younger generations, who no longer have fixed line services to their houses, preferring instead to do all via the wireless network. We have ample evidence that this network will improve, and it stretches credibility to think a fixed line NBN will reverse this trend or even reduce it. Of course, the government is hell-bent on making sure that we will not find out until it is too late to adjust the project.

I would like to take the opportunity today as well to look at some of the finer details of the NBN rollout. The government maintains 98 per cent of Australians will receive fibre-to-the-premises services. For those who will not be able to access fibre, the government has promised they will be supplied high-speed broadband of at least 12 megabytes either by wireless or satellite. This does lay a prima facie case. If 12 megabytes qualifies in the government’s eyes as high speed, what then of their argument that the coalition’s wireless proposals are inadequate? However, I shall put that debate to one side for the moment.

The government originally committed to 93 per cent of Australians having fibre-to-the-premises, including all towns with over 1,000 residents. Subsequent announcements commit to servicing 98 per cent and even more towns, with the remaining portion getting the far cheaper wireless and satellite services. I would like, therefore, to list some of the towns in my electorate, and their populations, which will miss out on the fibre-to-the-premises network: Orroroo, 500 people; Streaky Bay, 1,000 people—I thought people in towns of more than 1,000 people were to be serviced, but not Streaky Bay; Brinkworth, 400 people; Wudinna, 600 people; Wilmington, 600 people; and Leigh Creek, 630 people. There are many more but time does not permit me to mention them. However, it must be said these towns may miss out on the fibre-to-the-premises network and will have the much cheaper wireless or satellite service connected. But they will get the full bill; they will not miss out when it comes to paying for this monumental extravagance. For $7,251 per head, or $26,375 per family, they will certainly get their fair share and equality when it comes to the bill.

So, in closing, if we are to have this version of a broadband network then some of this legislation is required. But there are some areas, largely surrounding the opportunity for any other company to compete for any of the workload and put some type of competitive pressure on the NBN to perform, where I fully support the amendments foreshadowed by the member for Wentworth.

Debate interrupted.