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Thursday, 15 September 2011
Page: 6165


Senator CONROY (VictoriaMinister for Broadband, Communications and the Digital Economy, Deputy Leader of the Government in the Senate and Minister Assisting the Prime Minister on Digital Productivity) (10:16): I thank the members of the Senate who have contributed to this debate on the National Broadband Network Financial Transparency Bill 2010 (No. 2). Let us be clear about the motives of the coalition in reintroducing this private member's bill. It is not to task the Produc­tivity Commission to do a cost-benefit analysis on the NBN by 1 February 2012; it is all about masking the fact that they have now cobbled together over 21 broadband policies, with their latest policy calling for the cross-subsidy to the bush to be abolished and replaced with vouchers, treating people in regional Australia as second-class citizens.

Let me make the government's position very clear. In summing up, I note our speakers have repeatedly demonstrated that there is a uniform, wholesale national price so that all Australians, no matter where they live, can enjoy fast and fairly priced broadband. The Gillard government is delivering world-class broadband infra­structure which will underpin Australia's productivity, prosperity and creativity into the future. There is considerable evidence available on the benefits of the NBN nationally and internationally. The NBN is a reality and work is well advanced across the country and this measure is really all about trying to delay the rollout.

Parliament looked at a cost-benefit analysis and its issues in detail during the debate into the NBN Co. bills and access bills. The opposition wants the Productivity Commission to conduct a cost-benefit analysis, but when you boil it down such a call is just another excuse for delay, another stunt to prevent the rollout of high-speed broadband in this country. The government has already examined the viability of the NBN, including through the 2010 McKinsey-KPMG implementation study, released on 6 May 2010, and the Greenhill Caliburn review of the NBN Co.'s corporate plan, an executive summary of which was released on 14 February 2011. Those opposite are not genuinely interested in what a cost-benefit analysis conducted by the Productivity Commission or any other cost-benefit analysis has to say. It is a purely political stunt designed to cover their lack of a credible broadband policy. I think it was Mr Graeme Samuel, as chairman of the ACCC, who summed up the erroneous claims for a cost-benefit analysis best when in an interview he said the following:

I don’t think there is anyone in the country or in the world that will be able to tell you the benefits flowing from a high-speed broadband network five or 10 years out, let alone 20 or 30 or 40 or 50 years out.

And therefore when people talk about social cost-benefit analyses or cost-benefit analyses, I think that their failure to understand that what we’re talking about here is a visionary project much like the Snowy Mountains Scheme, which I will venture to suggest to you was never the subject of a cost-benefit analysis as has been described, but was the subject of a range of different elements, not the least of which was a vision as to how it might benefit communities in general into the future.

The time frame set out under the amendment requiring the Productivity Commission to prepare a cost-benefit analysis of the NBN proposal by 1 February 2012 is ridiculous and unrealistic. To do a formal cost-benefit analysis of the NBN would take at least 18 months but even then would require many heroic assumptions and would only tell us something that we already know, that Australia needs greater investment in high-speed broadband infrastructure.

NBN Co. is already subject to compre­hensive scrutiny, more so than any publicly listed company and rightfully so given the amount of Commonwealth equity involved in the NBN rollout. NBN Co. is required to appear before the Senate Environment and Communications Com­mittee as part of the Senate estimates process, where a significant number of questions on notice have been received and responded to. But let us be clear: in that forum the opposition continues to cry crocodile tears in claiming they are focused on and care about scrutiny and financial transparency. I say that because the evidence is to the contrary; it completely contradicts their claims. In the most recent Senate estimates hearing for NBN Co.—and, Senator Ludlam, I think you were forced to sit through it—in four hours of testimony, the opposition devoted over 3½ hours to their disgraceful smear campaign on Mr Michael Quigley, the CEO, and no more than 17 minutes to questions on issues to do with the NBN; 17 minutes in four hours.

Senator Birmingham: How is Mr Beaufret going?

Senator CONROY: Oh, you are going to smear someone else today, are you, Senator? You are very disappointing, Senator Birmingham. You are a better person than this—but, no, you stooped in the gutter with the rest of them. You can look back on this in the future and say, 'I'm ashamed of myself.' That is what you will think when you look in the mirror—disgraceful!

Senator Birmingham interjecting

Senator CONROY: He is retiring. Seventeen minutes in four hours.

Senator Birmingham interjecting

Senator CONROY: Yes, to someone from another a country.

Senator Birmingham: Do you want to tell us why he's going?

Senator CONROY: He is retiring. The National Broadband Network is Australia's largest infrastructure project in our history. It is a nation-building project that all Aust­ralians both now and into the future will benefit from. It will deliver significant improvements in broadband services for all Australians at affordable prices. It will support a new wave of digital innovation that will change and improve the way Australians live their lives, receive services and connect to the world. It will help to drive Australia's productivity. It will transform service delivery in key areas, such as health, education and energy. And it will connect Australia's big cities, regional centres and rural communities.

The NBN will deliver affordable, high-speed broadband services to all Australian homes, businesses, schools and hospitals, no matter where they are located in Australia. The NBN will connect 93 per cent of premises to a high-speed fibre network, providing broadband speeds of up to 100 megabits per second with capability to provide higher speeds of up to one gigabit per second in the future. All remaining premises will be served by a combination of next-generation fixed-wireless and satellite technologies, providing peak speeds of 12 megabits per second.

While the Gillard government remains committed to uniform wholesale pricing, the National Party have walked away from not only their constituents in rural and regional Australia but also their own policies—and, Senator Ludlam, I am sure you are going to be interested in some of the quotes I am going to read out in a moment. At their states conference in 2005, the Queensland Nationals passed a resolution for the imple­mentation of their five-pillar telecom­munications policy; however, that is now an inconvenient truth for them. This is what they said—this is what their own resolution said:

4. The maintenance of the price averaging basis for the cost of all new telecommunications and satellite Internet connections to ensure all Australians are charged the same basic price for maintenance and new connections …

And what are they supporting now? Vouchers; abolish their cross-subsidy—vouchers. But it gets better. In an interview with Laurie Oakes back in 2005, then Barnaby Joyce, now Senator Barnaby Joyce, was calling on his coalition colleagues to ensure that telecommunications policy, and I quote:

... we're going to give this—the 20 million people who live in such a vast country the ability to have parity of service, parity of price into the future.

He is now going to give them a voucher! It is clear that the Nationals are only interested in talking the talk, because the only walking they do is away from their rural and regional constituents.

The Gillard government remains committed to a high level of transparency and accountability regarding NBN Co. activity. The government recognises, accepts and welcomes that the NBN will touch the lives and homes of every Australian. It will transform and drive massive structural change in the Australian telecommunications market. It will involve the expenditure of billions of dollars of taxpayer funds and, understandably, generate demands for high levels of scrutiny, transparency, debate and parliamentary oversight both here and internationally.

The establishment of the joint committee on the rollout of the NBN, with very broad terms of reference and a balanced membership, demonstrates the government's commitment to openness and transparency for the NBN. The terms of reference include the rollout, take-up targets, service levels, risk management processes and any other matter concerning the NBN rollout that the committee thinks is relevant. The work of that committee is well underway, and they have released and tabled an interim report.

The government supported amendments to the NBN bills, passed by parliament on 28 March, that added NBN as a prescribed authority under the FOI Act and the commencement of a review of NBN Co.'s approach to FOI matters within 12 months of their scheme commencing. There is also the House of Representatives Standing Com­mittee on Infrastructure and Communica­tions, which has examined the economic and social benefits of the National Broadband Network as it relates to health, education, regional economic growth and development, and business revenues and exports, amongst others. This committee held hearings all around the country and has recently tabled its report in the parliament.

There has been significant scrutiny of the viability of the NBN, including, as I have mentioned, the 2010 McKinsey and KPMG implementation study, the NBN Co. corporate plan and the 2011 Greenhill Caliburn review of the NBN Co. corporate plan. NBN Co.'s corporate plan, released on 20 December last year, confirms the NBN can be built on a financially viable basis with affordable prices for consumers. The plan also shows NBN Co. expects a rate of return of around seven per cent, which is significantly higher than the long-term bond rate for the last 10 years of around 5.4 per cent. This means the government can recover all its investment in the NBN and make a return for taxpayers on that investment. The Greenhill Caliburn executive summary, released on 14 February 2011, validates the key assumptions made by NBN Co. and found that the corporate plan provides the government with a reasonable basis on which to make commercial decisions about the NBN Co.

Whilst the opposition continue in their quest to cover up their policy-free zone, business leaders at home and abroad continue to see the social and economic importance of the investment that we are making. Google's chairman and former CEO, Eric Schmidt, speaking earlier this year at the Mobile World Congress 2011 in Barcelona said:

… Australia is leading the world in understanding the importance of fibre. Your new Prime Minister as part of her campaign and now, you know, as part of her prime ministership, has announced that by roughly I think 2015 [or] 2016, 93 per cent of Australians, which I guess are all the folks in the cities, will have gigabit or equivalent service using fibre. And the other 7 per cent will be handled through wireless services of a nature of [Long Term Evolution].

This is leadership. And again, from Australia, which I think is wonderful.

That is the head of Google. But as we saw recently, when those opposite cannot get the experts to agree with them, they start attacking them. Just last week Mr Turnbull described Google as being involved in a conspiracy against the Australian taxpayer. That is what he actually said. He said they just want to use the network and their money is not in it. Ignore the fact that Google are investing their own money in the United States to build a fibre network providing a gigabit. No, here in Australia they are not prepared to put their own money up and they are engaged in a conspiracy against the Australian taxpayer!

Dodo and Exetel say, 'Actually, we are going to deliver services for $35 to $40 on the National Broadband Network.' They are attacked in the other chamber by Mr Fletcher on behalf of the opposition. If you are prepared to put your money where your mouth is—Google in the US, Exetel and Dodo here—completely disproving claims about the pricing of the NBN, you will be attacked by the opposition. It is a conspiracy to defraud the taxpayers of Australia!

What about Mr Craig Mundie, Microsoft's Chief Research and Strategy Officer? What did he have to say? Referring to the NBN he said: 'In the grand scheme of things going on in the world it probably ranks up there at the brilliant end of the scale, certainly in terms of what a government can do to prepare its citizens and businesses for an all-digital world of the future.' He went on to say: 'I think the leadership that has been provided here in Australia with this is far-sighted and one that I commend. It is a bit like ensuring that the population has water, roads and electricity. To some extent I think that broadband is going to become recognised as an essential service.'

But no, Microsoft are one of the conspirators as well according to Mr Turnbull. Google and Microsoft: it is a conspiracy. It is certainly a conspiracy against the policy-free zone of those opposite; that is true.

Mr Patrick Lo, founder and Chief Executive Officer of Netgear, said, 'We have a saying in the US, "If we build it, they will come." I think that applies in the case of the NBN.' Earlier this year another conspirator, Dr Tim Williams, the author of a report commissioned by Huawei titled Connecting Communities that looked into the benefits of the NBN, said, 'It is Australia's chance to not just catch up but get ahead decisively. It will more than pay for itself,'—another con­spirator against the Australian taxpayer.

In conclusion, the government's National Broadband Network will deliver cheaper and faster broadband services and is over­whelmingly supported by the Australian people. Detailed financial analysis has been undertaken in a $25 million implementation study. That study has provided a detailed analysis of the cost of delivering the NBN. It found that a $43 billion total capital cost is a conservative estimate and there are many opportunities to significant reduce the build cost. The Gillard government has revised that figure down through the NBN's own internal calculations in its business plan to $35.9 billion.

Importantly, our investment in the NBN is about future proofing Australia's economic prosperity, international competitiveness and social wellbeing, as well as laying the platform for the health, education and energy efficient solutions of the future. The Greenhill Caliburn report found the key assumptions underlying the revenue and cost projections of the NBN Co. corporate plan to be reasonable. Based on conservative assumptions, the NBN corporate plan shows the NBN will support uniform national wholesale prices that will support affordable retail prices. Do not be fooled by Mr Turnbull, Senator Birmingham and Mr Fletcher. Dodo and Exetel have put prices out there. Dodo is saying less than $40 and Exetel, for the base entry price to the National Broadband Network, is saying $34.95. There is no line rental. Always remember that, when it comes to the National Broadband Network, you do not need the copper anymore. The $29 a month that you pay currently is gone.

Senator Ludlam: That is outrageous; it's a scandal!

Senator CONROY: Outrageous I know! $34.95 for the base product from Exetel in the marketplace today. So the bill that Senator Birmingham is putting forward today should be seen for what it is: just another delaying tactic by those opposite to cover up their lack of policy when it comes to broadband in this country. I urge all senators to reject this bill.