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Monday, 7 March 2005
Page: 1

Senator CONROY (12:32 PM) —The Labor Party supports the Telecommunications (Consumer Protection and Service Standards) Amendment (National Relay Service) Bill 2005. The National Relay Service is provided within a statutory framework set out under part 3 of the Telecommunications (Consumer Protection and Service Standards) Act 1999. The primary object of the NRS is to provide deaf and hearing and/or speech impaired Australians with access to a standard telephone service. The NRS plays an important role in ensuring that hearing and speech impaired Australians are given communications services of an equivalent functionality to the rest of the population. In this context, the NRS requirements of the Australian telecommunications regulatory regime are a valuable community service.

The NRS allows hearing and speech impaired Australians to communicate via either text or voice communications by employing relay officers to translate calls from one medium to another. This service is confidential and cost free and is provided 24 hours a day, 365 days a year. It is, as such, a service of some significance and—as was pointed out in debate in the other place—since 1995, when the NRS was introduced, more than four million calls have been relayed through the service. While it is not perfect, it is a community service of which Australians ought to be proud.

Under the Telecommunications (Consumer Protection and Service Standards) Act 1999, telecommunications carriers fund the operation of the NRS through the payment of a quarterly levy. This levy functions in much the same way as the universal service obligation levy and is calculated according to the carrier’s share of total telecommunications carrier revenue. The current provider of the NRS is Australian Communication Exchange Ltd, a not-for-profit organisation which has been the provider since the inception of the service. While not without the occasional hiccup, on the whole the service provided by ACE during this time has been outstanding. Indeed, we have not heard any substantive complaints as to the operation of the NRS or any calls for urgent reform.

However, as this government is now learning, you cannot rest on your laurels—or the laurels of those who have come before you. In order for the NRS to remain the high-quality, cost-effective service that it has been in the past it is necessary to closely monitor the performance of the current system and be open to improvements where they can be made. The bill before the Senate is one such improvement. It provides for a small amendment to the legislative framework for the NRS that will give the Commonwealth more flexibility with regard to the administration of the National Relay Service. Currently, the Telecommunications (Consumer Protection and Service Standards) Act 1999 provides that the NRS must be supplied by a single provider under a single contract with the Commonwealth. This bill alters this situation by amending the definitions of ‘NRS contract’ and ‘NRS provider’ contained in the act and makes consequential amendments to the act to allow multiple providers to supply the service. The effect of the amendments is to allow the disaggregation of the NRS into separate components that can be provided by separate providers under separate contracts with the Commonwealth.

This increased flexibility provides a number of benefits. Allowing the Commonwealth to contract out separate components of the NRS to separate providers allows the Commonwealth to engage in selective sourcing or best-of-breed contract disaggregation. Under a best-of-breed approach, the Commonwealth could break up its NRS procurement into components and acquire services for each component from specialised providers. Allowing specialisation of this nature is thought to improve service quality and also to reduce costs by introducing new competitive influences into the tender process. The arguments for selective sourcing of the NRS seem to be very strong.

The technical core relay service aspect of the NRS is a very different service to the community outreach education and support services aspect of the NRS. One can certainly imagine a situation in which separate, specialised suppliers would be able to provide these services more efficiently than a single supplier. Permitting the acquisition of components of the NRS like this by separate providers, where the Commonwealth has determined through the tender process that the NRS is best provided by multiple providers, is only commonsense. We in the Labor Party hope that the change may go some way to addressing some of the delivery issues that have been raised in relation to the outreach program in the past.

A further benefit of the change may be to allow the Commonwealth to obtain NRS services more efficiently. In recent years there have been rapid changes in the information and communications technology markets and the way that these services are provided. Many niche operators specialising in only segments of the ICT market have emerged. This amendment allows the Commonwealth to utilise the services of these niche players and engage in the selective sourcing I mentioned earlier to obtain components of the NRS. The competitive effect of these niche operators may enable the Commonwealth to obtain a less costly NRS solution. It may also reduce the prices offered by comprehensive service providers for the NRS.

While a single head contractor is able to subcontract elements of the NRS to multiple suppliers under the legislation in its present form, this situation is not ideal. Accountability of contractors to the Commonwealth would be significantly increased by allowing the Commonwealth to contract directly with each supplier. The Commonwealth will be in a better position to ensure compliance with contractual service standards if it has a direct relationship with all suppliers.

This legislation has the further benefit of removing a current defect in the NRS scheme that prohibits a staged transition from one service provider to another. Because the current legislation allows for only one NRS provider, the Commonwealth would be forced to make a ‘clean break’ change in a situation in which it decided to change suppliers. The Commonwealth would not be able to pursue a staged transition during which an incumbent supplier incrementally handed over responsibility for the service to the new supplier. This amendment will allow the Commonwealth to employ the services of a new supplier without risking service levels as a result.

Again I say that this bill is not a reflection on the current provider: by all accounts, the service provided by the current provider has been good. However, regardless of the quality of service provided by the current provider, the provider should not obtain unnecessary legislative protection from the threat of new tenders. The current legislative environment grants the current provider a small legislative advantage over new tenders and this will inevitably reduce competitive pressures on the current provider to provide the highest quality service.

Debate in the other place recognised that, in addition to the benefits I have outlined, the amendments should not result in any reduction of service levels. The current legislation and the NRS contract require NRS providers to develop service standards as part of an NRS plan. These standards must address the number of calls to the NRS that do not get through; the call answer time of the service; the number of complaints about the service; the number of calls to Emergency 106 that do not get through; and the call answer time of the 106 text emergency service. Even if there are multiple suppliers of the NRS, it will still be possible to financially penalise providers for failing to meet non-emergency service standards. We hope that the Commonwealth will adopt this practice. We also expect the Commonwealth to ensure that standards for continuity of service are included in NRS contracts if multiple service providers are engaged to provide the NRS. However, we expect that, regardless of contractual requirements, the competitive effects of allowing specialised suppliers to provide components of the service will improve the quality of the NRS without the need for Commonwealth intervention.

This bill does not involve a substantial change to the administration of the NRS. Instead it is a small and straightforward amendment to the scheme that should improve the efficiency and the quality of service of the NRS. The bill will have no effect on the Commonwealth’s existing contractual arrangements with the current provider of the NRS, ACE. The Labor Party’s support for this bill is no reflection on the level of service provided by ACE as a full service provider of the NRS. We would not be at all surprised if ACE were to win the next tender for the NRS as a comprehensive supplier. The purpose of this bill is merely to keep ACE honest and to ensure that the NRS continues to be provided by the best and most efficient provider or providers in the market. The Labor Party support the continued operation of the NRS and we support this legislation as a measure designed to improve its operation.