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Address to the Regional Communications Forum.



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Address to the Regional Communications Forum Remarks by Senator the Hon. Richard Alston Minister for Communications, IT and the Arts Tuesday May 15 2001 National Convention Centre Canberra

I am delighted to be here today, as one of your final speakers.

A couple of years ago, I addressed the first Regional Communications Forum, and have been very pleased to see the very real outcomes that flowed out of that event.

In particular, the emphasis that regional communities are giving to finding their own individualised solutions to their telecommunications needs - solutions that involve partnerships with a variety of phone carriers as well as government programs like Networking the Nation and Building Additional Rural Networks.

The Coalition Government is acutely aware of the importance of telecommunications to people in regional Australia. New information and communications technologies, if used to their fullest potential, provide an unprecedented opportunity to finally bridge the communications gap that people in remote areas have felt for a century or longer.

There is a real passion about telecommunications issues in the bush. Recently, when I met with many people in regional and rural areas of Northern New South Wales and Central Queensland and received first hand their feedback on how to further improve services, it was abundantly clear that they consider that telecommunications is central to their future economic prosperity.

I came away from that trip with renewed confidence in the ability of regional communities to play a central role in developing innovative solutions to the telecommunications issues confronting them.

It is not gilding the lily to say that the Coalition Government has made an unprecedented commitment to improving telecommunications service delivery in regional Australia.

Ever since the Coalition entered Government in 1996, one of its highest priorities has been to ensure that the diverse telecommunications needs of people living in non-metropolitan areas of Australia are addressed in a way that provides equity with those in our capital cities.

Timely access to high quality and affordable telecommunications is an absolutely essential ingredient of being able to live and to conduct business in regional Australia.

All of the recent statistics show that farmers and rural communities are extremely enthusiastic users of new telecommunications services, including the Internet.

For example, in the year ending September 2000, Internet usage in regional Australia has increased to 32% of all households from 17% a year earlier. In fact, Internet take-up in regional Australia is quickly catching up with metropolitan areas.

Addressing the challenge of improving communications in the bush has called for a comprehensive and systematic approach to tackling issues on a number of fronts.

Since 1996, the Government has progressively been putting in place the elements required to significantly enhance the quality and affordability of communications services throughout all areas of Australia.

When we came to Government the telecommunications landscape was somewhat barren, with Telstra still providing the only service in town, as new arrivals Optus and Vodafone battled for market share, predominantly in the capital cities.

In the bush, people took what services they were given. There was certainly no encouragement for communities to take things into their own hands. There was no incentive to innovate, and there were no programs to improve communications infrastructure.

In fact when the Coalition entered government in March 1996, there were:

no requirements on Telstra to connect phones or repair faults in any timeframe; ● no additional mobile phone networks to replace the analogue network; ● no requirements to provide a 64Kb/s data speed upon request; ● no temporary services while phones were being installed; ●

no untimed calls in extended zones in remote Australia; ● no requirements to proved local call Internet access; and ● patchy mobile coverage on Australia's major highways. ●

Revolutionising telecommunications

The Coalition Government moved quickly.

One of the first things it did was to require Telstra to speed up the digitisation of its telephone exchanges around the country. In tandem with this upgrade, the Government mandated that Telstra must make ISDN or equivalent high-speed data services available upon request to all Australians.

It was also clear that a fully open and competitive telecommunications regulatory environment would deliver significant benefits both to business and to residential consumers, in terms of a greater choice, the earlier onset of innovative services, and most importantly, much lower prices.

As a result, the Coalition from 1 July 1997, fully opened up the telecommunications regulatory regime in Australia. There are now up to 70 phone carriers offering services,

many of which were not even heard of a few years ago.

Prices in many markets have literally plummeted with international calls falling by two-thirds, STD calls by nearly 50% and untimed local calls also falling by between 20 and 30 per cent. Consumers and businesses can also choose from a wide array of choices of competitively priced Internet services.

One of the most important enhancements the Coalition Government has made is to require phone carriers to adhere to service standards, particularly in relation to the installation and repair of phone services.

Before we came to government, there was no requirement upon Telstra or any other carrier to install or fix your phone within any timeframe. Now, if a phone is not installed or fixed within the designated timeframe, compensation must be paid. If a phone company continues to be negligent in meeting public expectations for timely installation and repair, it faces fines of up to $10 million. Since the introduction of the Customer Service Guarantee, the Government has progressively tightened the requirements in line with community expectations - and also extended them to second lines as well as designated meeting times.

In seeking to ensure that all Australians have access to the breadth of new communications services, the Coalition Government has also recognised that direct financial intervention is an important stimulus of service delivery and rollout outside the capital cities and larger regional centres.

Funded from the proceeds of the first partial sale of Telstra, the $250 million Networking the Nation (NTN) program is providing community-based telecommunications and information technologies around Australia with nearly 500 individual projects funded to date.

This program has made a significant difference to daily life in many rural, regional and remote communities, through the introduction of new services, the building of new networks, and stimulating community interest and involvement in projects.

From the second partial sale of Telstra, the Government invested a further $171 million in additional NTN initiatives which are ensuring that:

All Australians have access to the Internet at the price of a local call; ● Local government services are provided online, with community-based Internet access; ●

The telecommunications needs of remote and isolated island communities are addressed; and ●

Importantly, that there is funding for the building of significant rural telecommunications networks through the BARN program. ●

Deregulating the telecommunications market in Australia has generated a range of opportunities for regional communities to exert a greater level of control over the telecommunications services they receive. There are now a number of strategic options that regional communities - and even individual consumers and businesses within those communities - can take to introduce new services and service providers into their region.

One of the most significant moves made by the Government was its intervention to ensure the provision of an effective regulatory safety net, principally provided through the Universal Service Obligation (USO) that sets a 'floor' on the services.

We are also reforming the USO to subject it to greater competitive forces with a view to improving its delivery. We are about to commence the conduct of two multi-provider contestability pilots in regional Australia.

In the remotest 80% of Australia the USO has now been put out to competitive tender for the provision of untimed local calls, with Telstra announced as the preferred tenderer for this project. The Government is providing $150 million from the partial sale of Telstra to ensure that the 40,000 households who live in the remote outer extended zones receive untimed calls - a service that those of us living in the cities have long taken for granted.

In addition, the Government is providing continuous mobile phone coverage along almost 10,000 kilometres of 11 of Australia's major highways, with Vodafone to rollout services by the middle of 2002.

The future of Telstra

Let me say a little about Telstra.

In 1996, Telstra was 100% Government-owned. Government ownership is now 50.1%. The Government has made it clear that it will not proceed to introduce any further legislation relating to any further sale of Telstra unless and until it is satisfied that arrangements exist to deliver adequate services, particularly in rural and regional Australia.

At this point in time, we are not satisfied that services are adequate and believe that more needs to be done. In this context, I am particularly pleased today to outline to you the eagerly awaited response to the report of the independent Telecommunications Service Inquiry, the Besley report.

Response to Besley

The response to the Telecommunications Service Inquiry represents the next stage in the Coalition Government's ongoing commitment to provide world class telecommunications services in regional and rural Australia.

The Government is confident that the measures contained in the package will make a major difference and will substantially address the concerns raised in the Inquiry report.

The response involves a funding package totalling $163.1 million and responds to each of the 17 Besley recommendations and findings as well as to the three key issues of concern raised by Mr Besley; namely reliable telephone services, mobile phone coverage and the quality of basic Internet services.

These initiatives will provide widespread benefits to communities and business in regional, rural and remote Australia, and include:

$37.7 million for mobile phone coverage in population centres of 500 or more which currently do not have coverage, subject to community needs and ongoing viability. It ●

is estimated that about 60 population areas will receive coverage for the first time; $50.5 million to improve mobile coverage in other areas of Australia;

We will seek matching funding from the States and Territories to improve the scope and ultimate community benefits of the projects funded from this money. We will certainly also be looking to maximise contributions from carriers, and will seek an appropriate contribution from communities likely to benefit from the program, broadly consistent with other Government telecommunications funding programs like Networking the Nation.

The $50.5 million may be applied to:

- extending coverage to other population centres-for example seasonal populations;

- infill of terrestrial coverage around population centres;

- extending terrestrial coverage to key State/Territory highways; and

- subsidising or otherwise supporting the use of satellite handsets.

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$50 million for better quality and faster access to dial-up Internet services; The Government will participate in a joint venture with Telstra to fund the Internet Assistance Program, over three years.

It will help users achieve faster and better Internet browsing and email service, and better information about the range of related services for Internet users.

This initiative is in response to the Besley Report which found that a small, but significant number of customers, particularly in rural and remote areas, are either unable to access the Internet over their phone line, or have slow Internet speeds.

Under the Internet Assistance Program, residential and small business users will have access to a range of help services to solve Internet problems, and to achieve an effective Internet service speed equivalent to at least 19.2 kilobits per second, no matter where they live or carry on business.

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further strengthening of the Customer Service Guarantee (CSG) for new service connection times, and the USO in relation to the provision of temporary services; - Under this initiative all Australians seeking a telephone service will be provided with a temporary service within 30 working, if their permanent

service is not provided within that time frame.

In addition, all Australians will get access to a temporary service if a fault to their permanent service is not repaired within five working days.

In addition, those people in the most remote areas of Australia without infrastructure must have their phone installed within 6 months, reduced from the current 12 months - they will also get a temporary phone after 30 working days.

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A further highlight of the package is a $52.2 million National Communications Fund. The purpose of this Fund is to assist in the rollout of the infrastructure and applications which will enable high-speed telecommunications network to deliver health and education services in regional and rural Australia.

- Internet based technologies are revolutionising health care and education around the world. However, advances such as remote diagnostics and video-based online education are heavily reliant upon high-speed telecommunications links and the development of applications that are attuned to the needs of particular communities. Such links and applications are not always economically viable particularly in less populated parts of Australia -and the National Communications Fund will help ensure that rural and remote areas of Australia do not miss out on the health and educational benefits of the information revolution.

- One of the core funding criteria will be the extent to which these projects not only deliver better health care and education services, but also how they improve communications services more generally in the surrounding regional, rural and remote communities.

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The Government's response to the Besley Report also contains a range of other initiatives, which I will briefly mention:

$3.4 million will be provided over four years from 1 July 2002, to fund increased consumer representation and research in telecommunications. ●

$6.9 million will be used to deliver a comprehensive community information campaign. One of the key finding of Besley was that consumers have not been made fully aware of the telecommunications options and programs that are available to them - and if are to maximise the benefits delivered through Government programs and increased competition, they need to be fully informed.

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We are also allocating $400 000 to undertake a study of the telecommunications requirements of remote Indigenous communities, as well as to develop a detailed plan to address these needs.

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We will also improve payphone services for Indigenous communities in remote areas. This increase in the availability of payphones under the USO will be undertaken in consultation with affected communities and Telstra.

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Finally, the Government will strengthen the regulations relating to maintaining and improving the quality of service, as a result of the recommendations of the Besley report.

- All Primary Universal Service Providers (PUSPs) will be required to meet reliability standards for services provided under the USO, and a breach of the standards may attract a penalty of up to $10 million.

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Conclusion

In conclusion, I would like to say that the Government is proud of its strong record in regional telecommunications. While we will never resile from the fact that this is an ongoing

challenge, the progress which has been made since 1996 is one of the many lasting achievements of the Howard Government.

I firmly believe that the Besley Response hits the right buttons. It seeks to address the major concerns highlighted by the Besley Report; namely reliable basic phone services, improved mobile phone coverage and faster Internet dial-up speeds. We now have the job of delivering on today's commitments and I can assure you that every effort will be made to ensure that regional Australia reaps the benefits of these new services as early as possible.

Thank you.

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