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Thursday, 17 October 2002
Page: 5412


Senator KIRK (3:41 PM) —I rise to speak on the motion to take note of an answer given by Senator Alston, the Minister for Communications, Information Technology and the Arts, to a question asked by Senator Mackay in relation to this Telstra cabling bungle. In South Australia, as in many communities around Australia, constituents are experiencing already increasing difficulties in the adequacy and reliability of their local telecommunications services. A new blow has come to consumers in the form of these recent revelations of a time bomb in the form of the gel sealant that has been used to patch up, as Senator Lundy was saying, Telstra's already ageing cable network. This 3M gel has been used throughout Telstra's network to seal cable joins in order to weatherproof them. It has been in use since 1997 and cost a staggering $500 million to install. As we have heard, far from protecting the cable, this product in fact erodes and even splits it causing serious faults and outages. Despite early warnings from Telstra workers about this gel causing widespread corrosion of phone wires, the sealant continued to be used until last November. It has also emerged, as we have heard, that there was no extensive testing of the gel done before pouring it onto cables. The reason for this, as Senators Mackay and Lundy pointed out, is staff cuts at Telstra.

The use of the sealant has resulted, as we have heard, in the potential disruption of millions of phone lines around the country, most notably in areas where there is high rainfall. This has all come to light just 10 weeks away from the start of the wet season. There is now such an enormous backlog of work in fixing these problems that Telstra workers have had to resort to using plastic shopping bags to cover cable joints as a temporary measure to protect the lines against the weather. It will cost many millions of dollars to rectify the problems caused by the use of the sealant throughout the Telstra network. Telstra has confirmed that $187 million has already been set aside to fix the problem.

Consumers of Telstra want to know why this has come about. The only answer we can give them is that it has come about because we have had a deterioration in the amount of Telstra's capital resources now being dedicated to reinvestment in the actual infrastructure and the service. Yet the government, in complicity with Telstra management, continues to increase line rentals to try to claw back revenue. Since the federal election in November last year we have witnessed massive increases in line rentals—in the order of $2 to $3 per month in the month of August alone. There is said to be an objective to further increase line rentals to about $30 per month over the next few years. This would mean an increase from $11 per month, which is what the rental was only one or two years ago, to $30. That is a staggering 200 per cent increase in line rental. Whilst this increase may not matter that much to Minister Alston and his colleagues on the other side of the chamber, for a lot of people across Australia those few extra dollars per month really do matter.

Why is all of this occurring? It is occurring because it seems that the government, in conjunction with Telstra management, as Senator Lundy pointed out, is intent on fattening Telstra's bottom line with the prospect of privatisation down the road. This is what it is all about. The proposed quid pro quo for Telstra consumers was the government's suggestion that local call costs would fall, and of course they have not been delivered. Telstra's own ambition seems to be not to provide core telecommunications services anymore but instead to become a huge telco media player. My colleagues and I on this side want to see Telstra concentrate on its core business. I do not want to continue to have my metropolitan, regional and rural South Australian constituents coming to me with very basic problems about their dealings with Telstra. It is time that Telstra attended to its core business. It is time Telstra dealt with the average needs of telecommunication consumers. That is its core business, that is why it is in business; and that is why the Australian public have invested so heavily in the business. (Time expired)

Question agreed to.