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Thursday, 11 March 1999
Page: 2710

Senator BOSWELL (10:32 AM) —Today we are discussing the report of the Senate working party of the Environment Communications, Information Technology and the Arts Legislation Committee. The Senate working party represents the latest method to access Telstra network documents for CoT members in their epic dispute, including arbitration, with Telstra. It has been a dispute over 15 years in relation to the inadequate telephone service provided to their businesses by Telstra. To pursue their claims they have needed network documents which were solely in Telstra's possession. Over many years in attempting to obtain these documents from Telstra there have been many reports, all highly critical of Telstra's conduct in non-delivery of the documents.

In 1993 Austel reported that Telecom was less than a model corporate citizen, with Telecom admitting at the time:

It is of little or no bearing on the case that some of the testing has been purged from the system because we do not require these records to be convinced that this customer has serious concerns with her telephone service.

Backing up Austel was the Coopers and Lybrand report which found that Telstra's external communications featured inappropriate conclusions, inaccurate statements and evasive responses causing customers and external parties to be misled. I seek leave to table a series of documents.

The ACTING DEPUTY PRESIDENT (Senator Murphy) —Is leave granted?

Senator Carr —Can we see what they are?

The ACTING DEPUTY PRESIDENT —Senator Boswell, there is a request to see the documents. If we can get the documents circulated, we will come back to it.

Senator BOSWELL —In a letter dated 9 November 1993, Telstra threatened:

I believe that it should be pointed out—

this is a threat to Coopers and Lybrand—

that unless this report is withdrawn and revised, that their future in relation to Telecom may be irreparably damaged.

If that is not commercial thuggery, I do not know what is. There has also been a finding by the Commonwealth Ombudsman into defective FOI. That states:

In my opinion, the effect of applying the restrictive interpretation was to withhold information from Mrs Garms.

With CoT members continually being denied the support of network documents to progress their dispute, when a Senate inquiry was mooted in 1993 Telecom quickly agreed to a fast-tracked settlement procedure signed by Telstra and four CoT members at the instigation of Senator Alston, me and the then Labor government. But Telstra had other ideas—that is, to force CoTs into an over-legalistic arbitration process based on documents. Telecom's e-mail from Steve Black between the highest levels of Telecom reveals:

Whilst at a personal level I am of the view that we should walk away, I do not believe that this option suits Telecom's wider strategy in that it would appear to lead directly to a Senate inquiry. My course therefore is to force Gordon Hughes (the arbitrator) to rule on our preferred rules of arbitration.

The CoTs very reluctantly agreed to what was become an impossible nightmare—an over-legalistic, unequal arbitration process based on quick access to documents with the promise that arbitration would be fast-tracked, non-legalistic and would deliver the much needed network documents under the arbitrator's directions.

Forcing things to go Telstra's way has been their way ever since. Important network documents were withheld. Despite the arbitrator's directions, one CoT, Mrs Garms, had to go through her arbitration without the necessary network documents. When another CoT member, Graeme Schorer, refused to proceed with arbitration because he did not have the documents, Telstra took him to the Supreme Court to force him to proceed.

For the first time, on the day of her arbitration decision Mrs Garms received a document foreshadowing modernisation and restructuring of the Brisbane metro exchange. During the arbitration, another CoT member gave Ann Garms a document showing major works in her exchange. Documents obtained through the Senate recorded that the Mitchelton exchange was re-parented onto the Fortitude Valley on 12 September 1993. The next day Ann Garms's call rate increased by 212 per cent and other major works were performed prior to 12 September 1993 in Brisbane metro.

But it was all too late—Telstra had told the arbitrator in their principal defence document:

The network servicing the Tivoli immediately prior to the commencement of 13 September 1993 was precisely the same as the network that was servicing the Tivoli during the period between 13 September and 9 October 1993.

Yet, documents obtained through the working party reveal that this statement was untrue. The documents record major works in the Valley exchange leading up to a reparenting on 12 September 1993, plus data change notes recording major network changes and upgrades. Mr Acting Deputy President, this is all in the documentation that Senator Kim Carr is looking at at the moment.

Telstra's Steve Black gave a statutory declaration to the arbitrator stating `there was no major exchange work carried out in the Ley exchange.' Peter Gamble of Telstra, in a statutory declaration, said, `Further, the major upgrade did not take place'. All this was untrue. The vitally important resource unit to the arbitrator then concluded:

Officers of Telecom inform me that the major upgrade referred to by Close simply did not occur and that there was no major or unusual work undertaken at that time which would have affected the Tivoli's phone service.

Accordingly, the arbitrator decided:

Telstra denies a major upgrade of the Fortitude Valley exchange occurred in September 1993 and therefore the claim is fundamentally flawed to the extent it seeks to derive support from this event.

This is from document 7. Consequently, Mrs Garms lost and had to invest heavily in a Supreme Court appeal which she also lost as it was based on only pre-existing documents. Telstra had withheld the documents which detailed the major works whilst denying the major works and upgrade under oath in the arbitration. The Senate committee intervened, forming a Senate working party under Mr Wynack of the Commonwealth Ombudsman's office specifically to obtain for the CoTs the relevant network documents which Telstra had refused to supply. It lasted 16 months and involved Telstra spending around $2.5 million with 21 full-time Telstra members working on it, adding to Telstra's total costs spent on CoTs of $24 million.

To settle any disputes, communications experts Ambidji examined the CoTs' requests and found the majority were `reasonable'. The committee chair, Senator Patterson, ruled Ambidji conclusions must be complied with. Document search lists were drawn up with great consultation and detail at Telstra' s insistence. Yet on 10 February 1999, 15 months later, Telstra, in Mr Levy's letter, said they had searched without specific reference to Mrs Garms's submissions—and there are no such lists of document searches for the other four. To compound this unilateral change of the agreed process, Mr Levy and Mr Benjamin of Telstra told the Senate estimates that `Mr Wynack would have had knowledge of this.' Mr Wynack responded in two strong letters refuting it as `incomprehensible' and an `extraordinary development'. His final report, tabled today, contains several pages titled `Misrepresentation of the parties requests during the "final sweep searches,"' concluding:

What I thought was a transparent process agreed by the parties has turned out to be a process subject to unilateral amendment by Telstra.

Telstra are still withholding the most important network documents. Mr Wynack has said, `There is plausible evidence that Ericssons would have documentation' and that he believes much of the documentation specified by Mrs Garms would have been created. Further, going to the core of the dispute of bad service, he concluded that he believes:

The parties have provided what I consider compelling evidence that significant works were planned and probably undertaken during the period covered by Mrs Garm's requests of a major upgrade.

Documents provided through the working party reveal major works in the Valley exchange, the reparenting of 14 nodes onto the Valley exchange and Brisbane metro.

Mr Acting Deputy President, I seek leave to incorporate the rest of my speech as I am going to be pressed for time.

Leave granted.

The ACTING DEPUTY PRESIDENT (Senator Ferguson) —There is also the question with regard to the documents you sought leave to have tabled. Is leave granted?

Leave granted.

The speech read as follows—

But for the long suffering COTS—it is too little too late!

Documents far too late for the expensive arbitration and subsequent Supreme Court appeal of Mrs Garms. These small business peoples lives have been virtually destroyed by Telstra's heavy handed and powerful actions, all paid for out of the public purse, with seemingly no accountability.

Telstra by deliberately withholding documents has put their customers into a financially and emotionally crippling process—over all these years Telstra have continually defied all authorities critical reports by continuing to not disclose documents.

In similar fashion we now find they have omitted the most important Senate working party document requests and defied the Senate working party.

Their conduct is to act as a law unto themselves—more of those `bully boy' tactics spoken of in yesterday's Financial Review editorial.

They have now defied the Senate.

There is a rule in Washington that no building can be higher than the parliament—I want to remind Telstra—they are not bigger than the Australian parliament and the Australian people it represents.

COT members cannot be put through more—this report concludes no more documents will be forthcoming—the working party is now closed.

COT members deserve a final resolution to their nightmare—I support the findings of this report and urge a final solution now—by means of an independent assessment.

To meet the commitment given by the Labor Government, Senator Alston, myself and the TIO at the beginning of their arbitration—of fairness and justice through a fast track non legalistic process.

And as a stop to the spending of over $24 million of taxpayers money on denial, refusal and deception in relation to Telstra's obligation to deliver up documents—instead these brave small business people have had their lives, businesses, peace of mind and assets destroyed by the many times proven misconduct of Telstra.