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Tuesday, 24 September 2002
Page: 4787

Senator LUNDY (7:45 PM) —Last Thursday, I rose to speak on the adjournment debate and was addressing the issues of the need for new broadband networks. I spoke about these networks needing to be open networks—that is, they should be networks that carry the retail services of any provider willing to lease the bandwidth necessary to deliver them. I argued that supporting an open network policy for new communications infrastructure is smart policy that has learned from past mistakes. I would like to continue my comments this evening.

In my view, such an approach would justify subsidies funded through connectivity programs to broadband carriers. So far, these taxpayer funded programs have served Telstra quite well in entrenching its monopoly, so it is about time that real broadband competitors got a decent share. Because this solution is at its core pro-competitive, Telstra would still be free to mount a case to their private shareholders to make the capital investment necessary to upgrade their own network. But I argue that they should not be eligible for further subsidisation because they still have a residual monopoly. Indeed, a good test for Telstra's operation in the marketplace would be that they as a company choose to lease their wholesale bandwidth off others as others lease their wholesale bandwidth off them.

However, the coalition has proven completely ineffective in what they call `future-proofing' the telecommunications network and now are quite shameless in their pursuit of the privatisation agenda. An article entitled `Howard push to ease Telstra sale' by Laura Tingle, which was published in the Australian Financial Review today, says:

A legislative package which includes guaranteed funding to overcome any problems in Telstra service delivery to rural Australia—while `future proofing' rural telecommunications standards—is likely to be introduced in the Senate at the same time as Telstra sale legislation, sources said.

Well, well, well! What a surprise this is! This whole issue of further trying to bribe and buy the sale of Telstra is fully exposed. This was flagged by the Minister for Communications, Information Technology and the Arts back in July when the government was far more blatant in foreshadowing this shallow bribe. The minister was quoted then as saying:

... providing government funding assistance, either directly from the budget or through a fund earmarked specifically to getting what would otherwise be uncommercial telecommunications services over the line.

So what the government is talking about is throwing yet more taxpayers money at propping up a company, Telstra, which has failed to make that investment in the capital infrastructure to prepare Australia's telecommunications network for the future.

It is worth reflecting specifically on the fact that some $800 million of taxpayers money has already been spent on the Regional Telecommunications Infrastructure Fund, Networking The Nation, the Social Bonus and Intelligent Island programs and other programs over the last six years since the coalition came to power. And where are we? We have yet another inquiry of the government's own initiative, the Estens inquiry, which is an effort to try and create some sort of mandate for the further sale. No doubt the Estens inquiry, like the Besley inquiry before it, will identify some deficiencies, at which the government will then throw money. Like the Besley inquiry and the subsequent Besley inquiry response, it will reallocate money from previous programs, put it into new programs, put a big pink bow around it and hand it to rural and regional Australia and say, `Here, this will fix it; support privatisation.' It is all so predictable: the Estens inquiry will have the bag of money that the minister earmarked previously and try to dress it up and flog off Telstra in the way that it has tried to and in fact succeeded with previous tranches.

At the end of this charade we still have a telecommunications network that in no way prepares Australia for the future. Certainly, to sell Telstra in the first instance is the worst way forward. There is still a residual monopoly and, hand in hand with the coalition government, Telstra has selected a future for Australia characterised by mediocrity and a myopic view of our ICT potential. This is a view that is fed and fuelled by Telstra executives, who have only one aspiration and that is for improving its share price. This aspiration is shared by the coalition government. Why? Because they want to sell it. They want to sell Telstra, and they have a direct interest in the return to the government from the sale because it means they can prop up their budget and so forth.

It seems to me that there needs to be some way to break the cycle. The best way to break it, of course, would be to elect a federal Labor government but, unfortunately, we have got a few years yet before we will have the opportunity. So what can be done in the meantime to stop this charade? You will see the Labor team continuing their valiant struggle against the further privatisation of Telstra. We will support an appropriate price control regime but we will not support the false program of price control that the government is putting forward. We will also look at our state colleagues to see what initiatives they can take to try and get Australia out of the broadband rut that Telstra has so comprehensively kept us in over the years.

Looking at what the states have done is a very worthy lesson for this chamber. To help break Telstra's stagnant grip on the market, it is quite appropriate that the states are looking at how they can aggregate demand and their requirements and put out to market various opportunities that, hopefully, will put some pressure on Telstra to actually respond to market needs. I would like to make direct reference to an initiative taken by our Labor colleagues in the New South Wales government. They have taken the lead in connecting New South Wales to broadband. Despite the fact that Telstra has a significant presence in the market, it just has not happened. I will refer to a media release issued by my colleague Kim Yeadon in New South Wales on 18 September this year. It says:

The call has gone out to the private sector to work with the NSW Government to connect up to 5,000 sites throughout the State to faster and more reliable telecommunications services ... The NSW Government today called for Expressions of Interest on how companies could provide broadband connections via rail and electricity infrastructure as well as towers, ducts and rights of way owned by the NSW Government. This could provide fast, reliable Internet connections for towns from the Queensland to Victorian border including Armidale, Tamworth, Lithgow, Kiama, Yass, Wagga Wagga and Jindera. This is part of a $283 million plan to bring faster and more reliable telecommunications services to towns and cities throughout NSW.

The point is made that nowhere else in Australia is this being attempted on this sort of size or scale. The New South Wales government wants the private sector to come forward and show how it can provide the last-mile connection to a backbone of fibre optic cable running from the Queensland border to the Victorian border.

This initiative is worth dwelling on for just one moment. It shows that there is something that can be done with government purchasing by actually leveraging again the expenditure of significant amounts of taxpayers' money. But have we seen an initiative like this from the federal government? Have we seen any interest at all in investing in what are known as disruptive technologies to provide a far more efficient, cost-effective and broadband service to the citizens of this country? Of course not. The coalition government is deadset intent on keeping Telstra's monopoly as rock-solid as it can, because it has an interest in Telstra's value and in privatising the rest of Telstra.

I would like to take this opportunity to commend the initiative of the New South Wales state government and of the other state governments, including the Victorian government. I will take the opportunity at some other time to canvass the Victorian government's initiatives in driving broadband out into rural and regional Australia, where it is most needed. There is an inverse need—it is needed more out there because they are less able to connect with people in the usual way that we do in big cities. I will take the opportunity to outline the initiatives of the Queensland government and the other state Labor governments such as the Northern Territory government and so forth at another time. In this way Labor can work in opposition federally with our state counterparts to drive broadband out, despite the myopic and backward-looking view of the federal coalition government. (Time expired)