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Tuesday, 18 May 1993
Page: 706

Senator KERNOT —My question is directed to the Minister for Transport and Communications. In the Minister's answer to Senator Bourne, he said that the Department of Transport and Communications had not undermined the Government. In the pay TV legislation drafted by his department, debated last November, is it not clear that the Government's mandated satellite delivery for pay TV was undermined by the free kick given to microwave? Is not this view of

departmental responsibility given further credibility by the determination drafted for the Minister by DOTAC in January which gave Mr Cosser automatic rights to convert narrowcast licences to broadcast? And, if it is not the case, why then did the Prime Minister himself allege that the department had notoriously misled Cabinet over the potential of microwave to supplement satellite delivery?

Senator COLLINS —I reiterate what I said and, in fact, confirm it. I apply to the word `undermine' what I think is the commonsense interpretation of that word—that these problems occurred with intent, that is, it was the cold-blooded, conscious intention of the department to subvert a policy. I do reject that because the facts speak for themselves. I have acknowledged that the Australian Democrats were the only people in this chamber who doubted the advice that we were given of the commercial viability of MDS—indeed, Senator Bourne has confirmed that that was her view, and clarified it—in that the Australian Democrats did propose to the Government during the negotiations that we should consider mandating narrowcast only for MDS.

  Senator Kernot should read the full advices that were given to the Cabinet—both briefs that were given to me on the day that I met Mr Cosser—which laid out the considerable technical difficulties in attracting any significant level of support for MDS. That opinion of the department, which was, in fact, the opinion expressed, was echoed by widespread industry appreciation. I said in the Federal Court—and it has been confirmed—that others I consulted at the time, in particular the ABC, which does have a very good working knowledge of the broadcasting potential of MDS, said in the phone call I got from Mr Hill, `We were all wrong'. That expression `we were all wrong' referred to the commercial understanding we had that, because of the difficulties of this technology, it would not be financed or potentially financed in a way which would threaten the viability of the satellite.

  I acknowledge that the Opposition also had that view and that if we had not had that joint view we would not have spent months putting conditions on the satellite involving the ABC and industry which were never put on MDS. That view was wrong. But, I assert again, it was not wrong because of some conscious intent on the facts of the department to undermine a policy. It was wrong because we all accepted advice about the commercial realities of the marketplace which the marketplace had a distinctly different view of at the end of the day.

Senator KERNOT —Mr President, I ask a supplementary question. The Minister avoided the last part of the question. Under the Minister's definition, can one notoriously mislead Cabinet without cold-blooded intent?

Senator COLLINS —Of course, one cannot. The Prime Minister was angry at that time, as I was, that the ABC's view was wrong. Industry sources, such as Mr Fred Kenyon, one of the most respected consultants to everyone at large on this particular technology, were wrong—that is, that it should never be backed by what he called `management types' for this kind of technology. Indeed, the Prime Minister was angry. From time to time the Prime Minister has made telephone calls, and this was not the first one that received publicity.