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Telstra privatisation debate continues along with the announcement of a second inquiry into telecommunications services in the bush.

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Friday 16 August 2002


Telstra privatisation debate continues along with the announcement of a second inquiry into telecommunications services in the bush.


MARK COLVIN: The combined value of all the Telstra shares in private hands is about $32 billion, and the federal government today is a step closer to getting about the same amount for the other half of the carrier.  


It may be nothing like what they might have got at the height of the technology boom, but the government's determination has not flagged, and today Mr Costello's $32 billion is tantalisingly closer. 


Today's announcement of a second inquiry into telecommunications services in the bush means parliament could be considering complete privatisation as soon as early next year.  


In the meantime, a cotton farmer from Moree in New South Wales, assisted by a Tasmanian cheesemaker and a former National Party member from Queensland, will assess services in the bush. Their deadline, less than three months from now. 


From Canberra, Simon Santow reports. 


SIMON SANTOW: As he toured regional Queensland, Peter Costello did little to hide how passionate he is about selling off the rest of Telstra. 


PETER COSTELLO: We'll have an inquiry and will await its report to see whether or not the improvements are sufficient to satisfy the government, but I think over the last couple of years there has been a very considerable improvement in the standard of services.  


SIMON SANTOW: But his tour didn't quite take him to the seat of Dawson and hostile territory, where the Nationals' Deanne Kelly holds court. In Kelly country, like quite a few other parts of regional and rural Australia, there's a bit of anger over the treasurer's plans to retire debt with the expected $35 billion proceeds from the sale of the rest of Telstra. 


And the MP herself is anxious that no-one make an assumption the National Party is anywhere near sanctioning a fully privatised Telstra. Deanne Kelly, too, rejects any talk that this second inquiry is just a precursor to a successful Telstra sale. Is it a fait accompli? She was asked. 


DEANNE KELLY: Certainly not. I don't think its up to individual ministers who've had a three-day travel through rural and regional Australia to assess this. Obviously the level of telecommunications service is vitally important to people who live in rural and regional Australia, and more importantly, those who work there.  


So, it has to be very carefully assessed. And, can I say that there is no correlation in the National Party's mind, between the second Besley inquiry, which is quite appropriate and any question of the further sale of Telstra.  


SIMON SANTOW: And then there was a second rebuke from Deanne Kelly for Peter Costello. 


DEANNE KELLY: We're not going to be pushed on what is a very important issue for rual and regional Australians. Can I also say in regard to the question of a full sale, the National Party broadly, are concerned that there's talk of further proceeds being used to reduce Government debt.  


But the reality is that rural and regional Australians are falling behind major metropolitan cities in terms of infrastructure, growth, and opportunities. It's very important that some of that sale money, if it goes ahead, and as I said, that is a very big if for the National Party, is put towards infrastructure. 


SIMON SANTOW: She wouldn't have liked this, too, from another city based Victorian Liberal, Senator Richard Alston. 


RICHARD ALSTON: On T1 and T2 we did use the proceeds overwhelmingly for debt retirement, and I think that has to remain the top priority.  


SIMON SANTOW: The Prime Minister, John Howard, is more cautious.  


JOHN HOWARD: We had to take the Telstra thing step by step. The step announced today by Richard Alston was to measure whether things were up to scratch. Until I get that I'm not going to express a view as to whether they are up to scratch. And obviously, we're not going to take steps to sell further shares in Telstra unless we get a positive read-out from this committee that things are up to scratch.  


SIMON SANTOW: And, says Peter Costello, any ongoing problems could be easily remedied by wielding a stick at Telstra. 


PETER COSTELLO: Now, we've got to make sure that services continue to improve, and we've got to make sure that we put in place service obligations so that Telstra continues to deliver new technology in regional areas, and that's our policy. 


SIMON SANTOW: It's that confidence which gets up the nose of many with a natural rural constituency. Conservative Federal Independent MP in regional New South Wales, Tony Windsor:  


TONY WINDSOR: This inquiry hasn't been set up so much to consult people, and even the terms of reference are framed to make it look as though there's been progress since the last inquiry. Well we all know there's been progress; what people are concerned about is what we're going to end up with.  


In my view, and I think the view of most country constituents, is that the service delivery can't be guaranteed, constitutionally or legally, into the future, and when you look at the performance figures of Telstra, it's not a wounded corporate operation. There's something like $2.5 billion a year in tax coming through, and about 2.3 or 4 in dividends being paid. 


SIMON SANTOW: The person charged with chairing the crucial second telco inquiry is a cotton farmer from Moree, and a good friend of National Party Leader John Anderson. Dick Estens says he hasn't pre-judged the outcome, but he was happy to outline the improvements already made with $160 million arising from the Besley Inquiry. 


DICK ESTENS: I think it's about ensuring that Telstra is doing the right thing with regional Australia and the bush. In the past, I think their services have been pretty good. I think it's about, you know, as time marches on it's about improvement, and making sure that adequate services reach regional Australia. 


SIMON SANTOW: Tony Windsor says the make-up of the inquiry panel is key to understanding what it's certain to deliver. 


TONY WINDSOR: I know Dick Estens quite well. He's on record as saying, this morning, that services in regional Australia are quite reasonable, so it's almost pointless being involved in an inquiry if you've made a decision like that before you start.  


But there are some crucial players in relation to this, and you'll notice that there is a Tasmanian in there. The Tasmanian senators are going to be absolutely crucial, so I would suggest that there'll be some bids made from that end, and someone to receive the information.  


Ray Braithwaite from Queensland, an ex-National Party federal member, happens to be located in the very heart of the One Nation vote where one senator, Lynne Harris, happens to reside.