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Thursday, 5 May 1994
Page: 313


Senator BOURNE (12.25 p.m.) —The Australian Democrats will be supporting the Australian Telecommunications Amendment Bill. We believe that it strikes the right balance between allowing Telecom to offer innovative discount schemes on the one hand, while preventing it from using its dominant market position to prevent competition on the other. There seems to be little argument that provisions of the Telecommunications Act 1991 have unintentionally put Telecom's price discount schemes—for instance, flexiplans—in legal doubt. Furthermore, at the moment accusations by Telecom's competitors that a particular scheme is anti-competitive can be resolved only by the courts.

  The aim of this bill is to provide a better definition of an anti-competitive discount tariff to prevent Telecom from using discount schemes to lock its competitors out of certain markets, and to transfer jurisdiction over disputes from the courts to Austel. The immediate practical implications for Telecom's current discount schemes is that those which are generally available, such as flexiplans, will continue. Schemes available to only narrow sectors of the business or residential markets will not be allowed. The strategic partnership arrangements between Telecom and large business customers will have difficulty meeting the approval criteria in this bill.

  The bill allows a discount tariff to be offered by a dominant carrier if it meets one of two tests. The first is that it must be generally available to business or residential customers, or both. Austel may determine a subclass of business or residential customers to whom the discount must be generally available. The second is that it may be permitted by Austel if it reflects differences in the costs of providing services, or is in the community interest, or is part of a trial program. However, if either of these tests are met, Austel may still disallow the tariff on anti-competitive grounds. It is a belts and braces approach which should contribute to commercially sustainable competition in the telecommunications market.

  I was pleased to hear that the opposition will not be proceeding with the amendment moved in the House of Representatives. That amendment required discount schemes not only to be generally available, but to be of broad appeal. The Democrats believe that this would create serious legal doubts about what we would regard as legitimate discount schemes offered by Telecom. I am glad to hear that the opposition regards them so as well. It is also unnecessary, given the breadth of Austel's new disallowance power.

  I must say that no-one in the industry has contacted us with any significant concerns about this bill. In fact, no-one has come to us with any concerns about the bill at all. I was very surprised to read in yesterday's Australian Financial Review that Senator Alston was considering moving for a committee inquiry into this bill. I congratulate him on apparently changing his mind. The Democrats believe that the bill is constructive and sensible, and we will be supporting it.