CHAIR —I thank the officers of ACMA for appearing before us this evening. Mr Chapman, do you wish to make an opening statement?

Mr Chapman —No, thank you. I would just note that as is customary practice I appear with my Acting Deputy Chair, Mr Cheah, and my five general managers with a view to hopefully covering questions across the broad diversity of the work that we do.

CHAIR —Thank you very much. I would like to start off. Could you give us some information about recent changes in mobile premium services?

Mr Chapman —I would be very happy to do that. The recent announcements we made, which in essence were the registration of a new code dealing with the subject matter, a number of new service provider determinations and finally a very prescriptive monitoring and audit program that we are going to implement, represent a raft of measures with respect to mobile premium services that is the culmination of a lot of hard work. There has been a lot of hard work across a number of players in this space. Ultimately, we are the party responsible for registering the code and implementing the other measures I touched on. I think it is a very good example of the way in which the industry, Communications Alliance, the consumer advocacy bodies, the telecommunications ombudsman, and indeed the minister in the way in which he lent his support and interest to the issue, came together to produce these outcomes.

There is no question that there needed to be an industry wide response to what was a totally unacceptable trend in the number of complaints arising from late 2007 to when it reached a peak of something like 3,500 complaint issues in July 2008. It is not a coincidence for a moment that the new code started to gather internal discussion within the industry and, with our hard work and focus on it, that the complaints have been coming down dramatically since then. In other words, what I am suggesting is that the industry players from that moment realised that they had an issue and they have been living to it in a much better way than they had been before.

CHAIR —Do you have statistics about how the complaints have begun to reduce?

Mr Chapman —We do have those and we can table them. As I said, there were about 3,500 complaints per month at the peak in July 2008 and they fell to half of that level by April 2009. It is a dramatic demonstration of the focus, aptitude, the combination of measures and the understanding within the industry that the matter has to be taken seriously. I mentioned the minister earlier, because the minister did get involved and made it very clear to the industry that they needed to get their act together on this matter, and we think that the industry are well on their way to getting their act together.

We presented it to consumers and the public last week as the registration of the code and the announcement of a number of new service provider determinations. Compliance with these new rules is not optional; the rules are directly enforceable by ACMA. As I mentioned, there is an intensive and comprehensive program of monitoring compliance.

What does it mean for consumers—mobile phone users? Our strategy that we have approved and adopted means that a consumer will only be signed up to a service if they want to be really and truly part of that service. It is what we call double opt-in. They will know how to stop services they no longer want by simply sending ‘stop’ and they will know where to go to in order to get help or to get a complaint resolved. I think there has been a sea change already in the transparency of the information and access to that information.

CHAIR —Can you explain each of those, in particular the double opt-in and the stop mechanism?

Mr Chapman —I would be very happy to. There is a requirement that two independent confirmations of all requests from mobile phone users who subscribe to a service be obtained, which is what we call double opt-in. It will involve improved advertising requirements, including a ban on advertising for a service that targets children under 15. There will be a requirement that services are cancelled when a mobile phone user sends a stop message in reply to a premium SMS message, and that a description of how to cancel a service is included in advertising in messages confirming subscriptions and in reminder messages. For example, it will include a requirement that companies supplying services provide a local or free call help line that is staffed during business hours and includes details of the help line in advertisements, in messages confirming subscriptions, and in reminder messages.

Another feature is the establishment of a register of companies supplying mobile premium services. The planned ACMA service provider determination will, very importantly, prohibit carriage service providers and content aggregators contracting with companies which are not on the register. There are multiple layers to this, but in broad outline that is the suite of initiatives that were brought together in the announcement of the new framework which will significantly better consumers in the mobile premium services space.

CHAIR —It promises a lot, but what is ACMA doing to ensure that it delivers? What monitoring is there and what have you put in place to assist consumers? If I have a complaint, I do not particularly want to have to ring up and be put on hold forever getting through to someone to register my complaint.

Mr Chapman —I will hand over to Ms O’Loughlin with respect to the details.

Ms O’Loughlin —As the chair mentioned, we have a very comprehensive monitoring and compliance program over the next 12 months. That involves specifically looking at how complaints are handled over the next 12 months. The code will be in place for only 12 months before review, so we have a very early opportunity to review the code and make sure that it is working effectively. In that 12-month period my team will be looking at a number of areas of monitoring and compliance, including quarterly reporting around how complaints are being handled by content service providers and also carriage service providers. One of the main areas of concern for consumers in the past has been not being able to get through to somebody who can effectively deal with their complaint. We are requiring that not only must the content service providers have a help line and a location in Australia that people can be contacted but they must have a 24-7 line available so that people can get on to the content service providers directly.

We have also ensured that carriage service providers who those content service providers deal through must also make sure that if complaints are escalated to them they deal with them effectively. We will be monitoring that very carefully over the next 12 months. There is a broad range of other monitoring around the provisions in the code that we will be conducting as well. It is fair to say that it is probably the most comprehensive compliance and monitoring program that we have introduced for a new code.

CHAIR —Is it a voluntary code?

Ms O’Loughlin —We consider that compliance with the code is not an option.

CHAIR —What are the sanctions that can apply?

Ms O’Loughlin —There are a number of sanctions. We have some steps in terms of building compliance. In the first instance we like to make sure that industry is building that compliance effectively, rather than jumping straight to sanctions. When we do move to sanctions there are provisions in the act where, if we direct a provider to comply with remedial directions or directions that we give them, there is the capacity for us to seek recourse through the Federal Court and there are penalties under the act as well.

Mr Chapman —Those fines range up to $250,000 per breach.

CHAIR —What have you done about letting parents know, in particular, that this code now applies?

Ms O’Loughlin —The industry itself has been extremely active. The code comes into effect on 1 July. The industry has been quite active in developing a website that people can go to in order to seek information on it. We will also be working with industry, once the code is introduced, to make sure that industry itself is getting those messages out to parents and people who require those services.

CHAIR —Thank you very much. Senator Birmingham.

Senator Conroy —Before you move from this subject, as I said when the announcement was made last week, I was really heartened when ACMA was finally able to register a new code and other measures to protect consumers in the mobile phone sector. These new enforceable rules will provide a better deal for consumers when it comes to services such as premium messages and, importantly, this new code will be reviewed after 12 months, giving the government opportunity to closely examine its operation, including the effectiveness of the dispute resolution framework.

I am optimistic about the enhanced levels—as has been mentioned already by the officials—of confidence for consumers when dealing with the industry on mobile premium services. However, I again put industry on notice to improve its act. Should problems arise in the future, the government will look to further strengthen the measures announced this week.

CHAIR —Thank you for that additional information.

Senator BIRMINGHAM —I just want to follow up on this issue. I am very happy to welcome the code as well, having asked some questions of these bodies about mobile premium services, too. I would just like to clarify a couple of things. Firstly, regarding the help lines, Mr Chapman said that the content providers had to provide an office hours help line, whereas Ms O’Loughlin said a 24-7 service. I would just like to be clear as to which one it is.

Ms O’Loughlin —It is 24-7.

Senator BIRMINGHAM —Very good.

Ms O’Loughlin —They are a live agent during business hours, but you can still go to the same number out of business hours.

Senator BIRMINGHAM —And leave a message or do something?

Mr Chapman —They can reconcile.

Senator BIRMINGHAM —So you are both correct.

Ms O’Loughlin —Yes.

Senator BIRMINGHAM —Excellent! That is always good to see. In terms of the double opt-in provisions, what level of information is required and how does it have to be spelt out around charging regularity of services and so on under the code at those points of the opting in?

Ms O’Loughlin —I will need to take some advice on that. I will ask Mr Humphries to deal with that question.

Mr Humphries —For double opt-in the first step to consider is when the service is advertised. There are fairly stringent requirements about providing information on pricing, including the basis on which charges are calculated, as well as when they are subscription services, which they often are, the subscription nature of the service and the help line details. That is provided at the advertising stage. When a person subscribes to a service they send a request. They must then receive information back which requests that they confirm their request. It must also provide details of pricing, the subscription nature of the service and the help line details.

Senator BIRMINGHAM —I know that no matter how much detail is in the advert it can often be somewhat confusing or obscured by other components of the advert, but when the message comes through on the phone screen it again has to repeat the costs, pricing, nature of the subscription service if it is a subscription service, and the help and stop components as well?

Mr Humphries —That is correct.

Senator BIRMINGHAM —Thank you very much.

Senator WORTLEY —I have some questions that are not on this issue. Would you be able to tell us how many complaints about child sexual abuse material ACMA receives?

Ms O’Loughlin —I am not sure that I have the absolute breakdown in front of me on child sexual abuse images but, for example, the total number of complaints received by the ACMA in relation to online content from 1 July 2008 to 30 April 2009 was 1,002. We have actioned 775 individual child sexual abuse items out of those 1,002 complaints.

Senator WORTLEY —I would like to move to the education program. Can you tell me what the government has been doing to address the concerns of parents and teachers when it comes to cybersafety?

Mr Chapman —I would be happy to provide some introductory comments on that. Last financial year was the foundation year for us to establish a body of work right across the various constituent parts and this year we will certainly capitalise on that foundation work. The ACMA is further developing what I think is a truly extensive range of programs that look to address the concerns of parents and teachers in relation to cybersafety. For example, these include internet safety awareness sessions for parents; a professional development program for educators; a cybersafety program for trainee teachers; a new education portal to be known as the Schools Cybersafety Gateway; a new cybersafety website; education resources such as CyberQuoll, CyberNetrix and Wise up to IT; live interactive activities such as the Cybersmart Detectives; and cybersafety material for library staff and users. Each of those initiatives that I have just outlined has an extraordinary amount of detail that sits behind it and significant leverage in terms of accessing right across Australia for the states and territories and in raw numbers. If you would like, I could ask Ms O’Loughlin to take it down to the next layer of detail.

Senator WORTLEY —Yes, I would appreciate that. Do you have information on the number of professional development courses that you have run and also on how many teachers have access to or have been through those courses?

Ms O’Loughlin —Certainly. In general, our outreach program, which is one of our main cybersafety education programs, has reached more than 40,000 participants at over 350 schools since it was introduced. We are finding at the moment that the demand is not decreasing. We expect to reach about another 54,000 participants in 2009 through about 450 separate awareness presentations for students, teachers and parents across Australia. We have generally been immensely encouraged by the level of demand that we are getting for those types of presentations.

In terms of the professional development program, since we launched the program in January this year we have delivered 49 professional development courses. We have had 13 schools that have hosted the professional development workshops on site. To date, 1,444 teachers have participated in the program. Again, we are finding very high levels of demand and we are getting exceptionally good feedback on the value of our program for teachers.

Senator WORTLEY —How do the teachers or the schools find out about the program?

Ms O’Loughlin —We have gone directly through the state and territory education departments to the schools. We have done a round of awareness raising in that area. Some of it has been through the various school and teacher associations. We have targeted them to make sure that we have professional development courses which are appropriate and accredited but also so that we can use their networks to get to the schools that we need to.

Senator WORTLEY —What age are the students that have access to the courses or the program?

Ms O’Loughlin —In terms of the general outreach programs I might need to take that on notice.

Senator WORTLEY —When will ACMA’s new cybersafety website be launched?

Ms O’Loughlin —We are expecting to launch the new website mid-year this year. We are on schedule with that at the moment.

Senator WORTLEY —In relation to that, how will it cater for the different age groups?

Ms O’Loughlin —In general the website is designed with the primary target audience being children. We are trying to segment the site according to age groups, so that there will be a part of the site for young children up to seven and then an eight-to-12 section and a teen section. We are also very well aware that people will log on to different sections, so we are taking that into account. For each age group we are trying to make sure that the language and ideas that we use on the site are attractive to those particular groups. We are trying to use a lot more games and audiovisual and other activities and really highlighting the benefits of technology but also some of the things that children need to take into account for safe participation and contributions online.

Senator WORTLEY —Will it have access to a helpline?

Ms O’Loughlin —Yes. We are currently negotiating with a service provider to provide an online help facility for children. We are very much focusing not just on a helpline that comes to somebody like ACMA but on making sure that the helpline goes through to fully trained counsellors so that if there are issues of concern that children are coming across on which they need assistance from trained counsellors then they will have immediate access. Our plan is that that service will go live at the same time as the website.

Senator WORTLEY —I have heard from some of my teacher friends about the Cybersmart Detectives game. Can you tell us a bit about that?

Ms O’Loughlin —I will ask Ms Wright, as the provider of Cybersmart Detectives, to give you an update on where we are with that.

Ms Wright —Cybersmart Detectives is somewhat unique. It is an activity where children work online in real time and liaise with community professionals to solve an internet themed program or problem. This takes place in the school environment, often in a double period. They are liaising in the cyberworld with professionals, including education professionals; state, territory and federal police; the internet industry; and child welfare advocates. In the scenario they undertake the role, if you like, of being the school deputy principal who is concerned about the welfare of a new student. That student is perhaps being bullied by somebody that they have met in an internet chat room. A series of clues are sent out to the children who work together in teams to solve the mystery of what is worrying this student and why.

We have been getting very positive feedback on the program. One of the students said in the last activity, ‘It’s a fun way to learn about internet safety and I loved being able to do it with my friends,’ so they like the team environment. For the school’s part, they say, ‘The way the activity is structured certainly appeals to children.’ I quote the South Coogee Public School, who said to us: ‘I would certainly recommend it to others as the approach of using it is an almost instant messaging routine. It’s very engaging for the kids these days.’ He went on to say that for the schoolchildren: ‘Email is old hat for a lot of us here. That’s the thing that’s made the snail-mail old hat, but kids really respond to the instant messaging.’

They use this to engage and to endeavour to solve the problem and, by doing this, they actually have to look at the risks and the problems that are underlying the scenario. They are interacting with professionals to get clues as to how you might be able to successfully resolve this type of problem. In doing so, we think that they learn valuable lessons about the risks associated with the internet, internet use itself, and useful tips for chatting safely online. Most importantly, we think it is the issues that lie behind the story that they deal with in this way. It is the fact that they are discussing them with professionals who are dealing with those types of issues every day. It is a great advice service.

I would just like to quote one last testimonial, which we recently received from St Phillips Christian College. They stated:

I think it is working with kids on their own terms in the medium so that they learn about the medium.

Senator WORTLEY —How many students to date have had access to the Cybersmart detective program? Also, what age groups are we looking at?

Ms Wright —When we first started it was the last year of primary school, but children today are going online earlier and earlier. We are now finding that, rather than aiming that game at the 12-year-olds, we are going to 11-year-olds or even 10-year-olds with the same activity that we would have offered a couple of years ago. In 2008-09 the activity will be played by 300 schools. We are hoping that this year alone we will have reached 15,000 to 20,000 students. I think that is impressive when you realise it is an online live activity. It is not an activity like some of our other activities where you can go to the website and engage at any time you want. It does have to have those experts there to engage with the kids and drive the scenario. I think we will be very pleased with 20,000 by the end of the year.

Senator WORTLEY —Do you approach the schools or do they contact you?

Ms Wright —They contact us. We also offer one- or two-hour length presentations to schools, as Ms O’Loughlin mentioned. They will often come back to us wanting more, and this activity is a logical extension.

Senator BIRMINGHAM —Can you tell me how many sites are currently on the ACMA blacklist?

Ms O’Loughlin —At 30 April ACMA’s blacklist contained 977 URLs.

Senator BIRMINGHAM —How does that stand against where ACMA was over the past six to 12 months?

Ms O’Loughlin —That is a lower number than has been the case in the last six to 12 months. As part of our normal processes, we go through a regular process of updating the URL list to get rid of URLs that are no longer there. We have done a recent review of that, and the current list is 977.

Senator BIRMINGHAM —Where do you stand with the international agreements at present and accessing and sourcing sites from other bodies and agencies?

Ms O’Loughlin —We have been in conversation, as you know, with the Internet Watch Foundation and colleagues in the US. At this stage we are looking at what processes need to be put in place for those lists to be used, given that they are developed under different laws than in Australia. Also, there are some technical amendments that need to be made to the industry code of practice to allow those to flow through to industry. I would have to say that it is still a work in progress. We have not added anything to the blacklist.

Senator BIRMINGHAM —What is the time line that you see for achieving those technical amendments?

Ms O’Loughlin —We will be working on it over the coming months.

Senator BIRMINGHAM —One of the government’s policy commitments was to ensure the ACMA blacklist is more comprehensive. I am assuming this is the key means by which that is being achieved.

Ms O’Loughlin —There are a couple of means. We also want to concentrate on raising public awareness of the capacity for the public to complain to us about material that they see online. Obviously, the more things that we are looking at that come to us in the complaints mechanisms available to us the more we can make sure that the blacklist is reflecting community concern.

Senator BIRMINGHAM —What steps are being taken to raise public awareness?

Ms O’Loughlin —Some of the work that we are doing on the cybersafety programs goes to that as well, in making sure that people not only know the benefits of technology and some of the risks that are out there, but also what they can do if they find things online that concern them, and one of those is to come to us.

Senator BIRMINGHAM —With respect to all of the courses, lessons and teachings that you were discussing with Senator Wortley before, is one of the end options, if you find inappropriate content, to contact ACMA?

Ms O’Loughlin —Yes. Under the legislation we have that role.

Senator BIRMINGHAM —Is it conveyed under all of those teachings, courses and so on?

Ms O’Loughlin —Yes. We include it on our website as well.

Senator BIRMINGHAM —Do you include your website as a link for people to get more information and so on?

Ms O’Loughlin —Yes.

Senator BIRMINGHAM —Where have you gone in terms of investigating the apparent or alleged leaking of the blacklist?

Ms O’Loughlin —In what regard?

Senator BIRMINGHAM —Referring to the apparent posting on the Wikileaks website of the blacklist back in March this year?

Mr Chapman —We have referred that matter to the AFP.

Senator BIRMINGHAM —Have you been provided with any recent updates in terms of their investigations?

Mr Chapman —No. It was a relatively recent referral. I would not expect to hear for a month or two.

Senator BIRMINGHAM —Does ‘relatively recent’ mean that the offence was relatively recent in that it was March or ‘relatively recent’ in that it was only referred in the last couple of weeks?

Mr Chapman —It was referred in the last couple of weeks.

Senator BIRMINGHAM —Why was there a delay between the March leaking of the list and the referral to the AFP?

Mr Chapman —I do not think there was any reason for it other than the process that we went through in going through the right protocols and getting the paperwork together and satisfying ourselves it was a matter worthy of referral. We have referred it. It is with the AFP.

Senator BIRMINGHAM —If the AFP had advised you of certain paperwork that you had to get together or something like that then that would make sense, but it seems unusual that you would take a couple of months to think about it and discuss it internally. Did you conduct any internal investigations into it yourselves in that time or were any other steps taken by the ACMA in the time from March until a week or two ago when it was referred to the AFP?

Ms O’Loughlin —It was just part of the process. As you will remember, the discussion around the so-called leak at the time really came down to the hacking of a filter from a particular filter provider, so we did not feel there was any concern in regard to the security of our list as was passed on to filter providers, but there was certainly an issue in regard to how those filter providers were keeping information from us within their own walls. There is a process to go through, as the chair said, around the AFP. We had significant information to pull together, which we have done. We have provided that to the AFP.

In terms of what we have done, obviously the capacity for someone to obtain any list out of the filter is of concern to us. We have written to the 13 Family Friendly filter providers under the IIA scheme to whom we provide that list. We asked them to provide information back to the ACMA with regard to any security vulnerabilities. We stopped distributing the list at that point in time until we were satisfied that we had information from those vendors as to what they would put in place. We have received a number of substantive responses to those. Our IT security staff have reviewed those responses to give us some greater confidence that those filters will not be able to be reverse engineered.

We are currently seeking some information from a couple of the vendors. We are now more confident that the list is being provided in a way and kept more secure within those filter providers than previously. We have distributed the revised list again in the last week, but only to the vendors who have provided us with information that has satisfied us. We also have asked the IIA to follow up vendors who have yet to respond, and we are also asking them to include new security criteria in their testing of filters that they accredit under the Family Friendly filter scheme.

Senator BIRMINGHAM —Of the 13 vendors, how many have responded?

Ms O’Loughlin —Eight.

Senator BIRMINGHAM —Eight have responded and five have not?

Ms O’Loughlin —That is right.

Senator BIRMINGHAM —How often would you normally provide updates to the blacklist?

Ms O’Loughlin —Weekly.

Senator BIRMINGHAM —Normally on a weekly basis?

Ms O’Loughlin —That is correct.

Senator BIRMINGHAM —Have they been suspended from March right through until about a week ago?

Ms O’Loughlin —Yes.

Senator BIRMINGHAM —All of that sounds like quite reasonable internal processes. I am still unclear as to what the process was that you went through internally between discovering the leak and deciding that it was worthy of an AFP referral.

Ms O’Loughlin —We were gathering information during that period. As you will remember at the time, there was a rolling program of information that came out publicly over that first week in online forums and discussion forums. We started off very much concerned about our internal process, but then as more information came to us it became very clear that where the alleged list was acquired from was actually from the filter itself, so we focused very much on both fixing the immediate problems for ourselves in terms of making sure that we were providing lists to secure filters and also at the same time dealing with a large number of complaints and looking at the matter of the AFP. We had a number of things running at the same time. The AFP paperwork required us to provide quite a lot of documentation, which we have done. It was really just a matter of getting the referral together.

Senator MINCHIN —Have you satisfied yourselves that it cannot possibly have come from within ACMA and therefore must have come from someone to whom you provided the list? Is that what you are telling us?

Mr Chapman —That is the essence of it, yes.

Senator BIRMINGHAM —When did you first make contact with the AFP about this leak?

Ms O’Loughlin —It was around a month ago. We are talking about a formal referral. We have been in discussions with the AFP, but we have now formally referred.

Senator BIRMINGHAM —I am just getting a clearer picture of the timeline of events. You said in response to the last answer that you had gone through the paperwork that was required for the AFP’s referral. It now makes sense that you had spoken to them around a month ago, which then gets us to being only a few weeks or so at most after the leak before that first contact occurred and then the processes of actually putting together the formal referral. Do the Family Friendly providers range in size in terms of ISPs and who they provide to?

Ms O’Loughlin —They are filter providers.

Senator BIRMINGHAM —Of course. I understand the difference there.

Senator MINCHIN —They are the only people who have received the list?

Ms O’Loughlin —They are the only people we provide it to at this point, yes. The current scheme only requires us to provide to Family Friendly filter providers.

Senator BIRMINGHAM —That is quite a mouthful.

Ms O’Loughlin —It is.

Senator BIRMINGHAM —You are doing very well. What reasons do you have, if any, for why the five have not yet responded?

Ms O’Loughlin —I do not have those reasons with me at the moment.

Ms Wright —It is fair to say that one or two have said prior to anything that happened this year for their own reasons their business had gone in a different direction and they were not utilising the list so they would not be coming back to us with a substantive reply.

In other cases we have followed up on a number of occasions and we have found that within those companies there have been changes of personnel. Should they come back to us and satisfy the security issues we would consider releasing the lists to those parties. In fact, I noted that one of the stragglers had contacted us today and there had been a change of personnel recently in that company. There are those sorts of issues, but we also thought we had reached the stage where it would be appropriate with IIA to be following up with the remainder because they are a party to that scheme under the internet industry’s own code.

Senator BIRMINGHAM —How is the list of URLs conveyed to the providers?

Ms Wright —When we provide a full list we have always encrypted it. We have taken this opportunity to look at our encryption measures and we have raised the bar in that regard.

Senator BIRMINGHAM —It is encrypted and then provided electronically?

Ms Wright —It has a password. If we make a notification they have to come back to us. There is a dialogue active with them before they can receive the list.

Senator MINCHIN —You would remember at the February hearings we raised the issue of the anti-abortion material that had been blacklisted, for want of a better word. I think you said that it had been added to the list in January. I am advised by my staff that through the Parliament House filtering system, Websense—I do not know whether they are one of your 13 Family Friendly providers—you can still look at this material despite the filtering system.

Senator Conroy —I think you are proving my point.

Senator MINCHIN —Am I?

Senator Conroy —Yes.

Senator MINCHIN —I am happy to do that if that is what I am doing.

Ms O’Loughlin —We could take that on notice.

Senator MINCHIN —On the face of it, is the Websense filter one of the 13 that receives the list? If it is, why can you still see this material?

Ms O’Loughlin —We would have to take that on notice. I would be interested to know whether it is the specific page.

Senator MINCHIN —That is what I am told, yes.

Ms O’Loughlin —If it is the specific page we could take on notice whether Websense is one of the Family Friendly filter providers or whether there are any other arrangements.

Senator MINCHIN —Presumably it should not take this long for it to be filtered out if they were one of your providers.

Ms O’Loughlin —No, it should not. Our expectation is that those new lists are provided—

Senator Conroy —It is only if the filter was downloaded and put on to the Senate system. That is what this process currently is.

Mr Chapman —Just for clarification, are you talking about the specific page off the website?

Senator MINCHIN —Yes. You sought to clarify what I was saying, not unreasonably, last time. It was not the whole site. It was just part of the site.

Mr Chapman —We will have to take that on notice. Our understanding is that it is one of the Family Friendly filter providers.

Senator MINCHIN —We are a very family friendly place here, of course, but I would be interested to know about that. You might do your own check as to whether what I am advised is, in fact, correct and, if so, why.

Ms O’Loughlin —We will.

Senator Conroy —Were your staff over 18?

Senator MINCHIN —I like to keep them pure. I do not like them seeing sordid things.

CHAIR —Thank you. Are there any further questions on this issue?

Senator LUDLAM —Yes, I have a couple.

CHAIR —Senator Ludlam.

Senator LUDLAM —I wanted to bring up the issue of the trial that is underway at the moment into expanding the scope of filtering. Is ACMA involved in any regard or should I direct these questions to the department a bit later in the evening?

Ms O’Loughlin —To the department.

Senator LUDLAM —So, you have no formal involvement?

Ms O’Loughlin —That is correct.

Senator Conroy —Other than supplying the list.

Ms O’Loughlin —Other than supplying our current blacklist to people involved in the trial.

Senator LUDLAM —I would like to come back to where we began. You said there were 977 sites. Is that right?

Ms O’Loughlin —That is correct.

Senator LUDLAM —That is down a little bit. Do you track and publish the number of referrals? I understand that ACMA does not go out looking for this material. You are a complaints based system.

Ms O’Loughlin —That is correct.

Senator LUDLAM —Are complaints up, down or sideways since the last time we discussed this?

Ms O’Loughlin —Our complaints have generally been up.

Ms Wright —In the last 18 months the rate of complaint to us has increased by 90 per cent.

Ms O’Loughlin —For example, in 2006-07 we received 602 complaints to us that were legitimate complaints under the scheme. As I mentioned earlier, between July 2008 and April 2009 we received 1,002.

Senator LUDLAM —Do you have any way of knowing whether there is more of this material proliferating out there or are people just being more vigilant in seeking it out and more aware of your processes for reporting it?

Ms O’Loughlin —I would probably hazard a guess that people are more aware that they can complain to us.

Senator LUDLAM —I just had a quick look on your website and it is actually hidden two or three levels deep. It is obviously people who care a fair bit. Are there organisations, in particular, that are making it their business to find and report this material or are you getting complaints from a range of individuals?

Ms O’Loughlin —In one of the questions on notice that we provided we stated there are quite a number of complaints provided directly to us by law enforcement agencies and child protection agencies. I do not have the question on notice in front of me at the moment. They are probably the only groups we get multiple complaints from.

Senator LUDLAM —Can you provide a rough proportion? I am trying to get a sense of whether it is mostly referrals from people who happen to find this stuff.

Ms O’Loughlin —During the period 1 July 2007 to 30 June 2008 ACMA received 1,122 complaints about online content. Forty-six complaints were anonymous and did not contain contact details. Because they are lodged online we do get anonymous complaints. Complaints containing contact details in the form of a contact email address came from 740 unique email addresses. Of 469 complaints received from people or organisations who lodged more than one complaint, around one quarter of those complaints were from law enforcement agencies, one-eighth were from child protection bodies, including overseas hotlines, and the remainder were from individuals who did not identify themselves as representing an organisation.

Senator LUDLAM —Are you quoting a response to a question on notice or is that from an annual report?

Ms O’Loughlin —That is from a question on notice.

Senator LUDLAM —Thank you very much. We discussed before that there is a lot of churn in these sites and that they do not have a very long residence time. Of the 977, how many would have been there 12 months ago or does the list turn over completely?

Ms Wright —In overview, what we understand from a search done by IWF that would reflect experience is that, should the material be child sexual abuse or child pornography, as it is often referred to, that would turn over within a two-month period. When we review our list we would find that the most movement has been for child sexual abuse material. Some of the other material does not move as quickly.

Senator LUDLAM —That makes sense. Is it still the case that just a little under half of the list is child sexual abuse related material? I think that is what you quoted us in October or February.

Ms O’Loughlin —With the current breakdown at 30 April, 51 per cent were refused classification and around 32 per cent were child abuse material and child sexual abuse material.

Senator LUDLAM —Is that of the entire list?

Ms O’Loughlin —That is right.

Senator LUDLAM —That is down quite a bit on 49 per cent, which is what I think you quoted to us last time.

Ms O’Loughlin —As Ms Wright pointed out, you do find that turns over quite a bit.

Senator LUDLAM —It jumps around a lot?

Ms O’Loughlin —Yes, it jumps around a lot.

Senator LUDLAM —I am obviously very concerned, as with many commentators, that there are currently 13 copies of the blacklist out there, plus the ISPs who are currently participating in the trial who have signed non-disclosure agreements of some sort. How many ISPs will you have to distribute this list to if and when every ISP in the country is required to have a copy of the list?

Ms O’Loughlin —That will be a matter for the government.

Senator LUDLAM —It has got to be for everybody. Do you have a rough idea how many ISPs there are in the country?

Senator Conroy —No. There are different methods of applying the policy. One of the methods that has recently been tested overseas—I believe it might be New Zealand—has found a way to do it without distributing the lists.

Senator LUDLAM —Maybe we will get to that a little bit later.

Senator Conroy —I am not an expert in it. I just saw a reference to it recently, but I think it is New Zealand.

Senator LUDLAM —I might come back to this when we have the officers of the department at the table. Encryption has been known for years, probably since the internet has existed, as a bit of an arms race. We figure out a better form of encryption and then people figure out how to hack it and how to distribute it.

Senator Conroy —If people want to spend their time unencrypting titles of child pornography and child sexual abuse images that is a comment on them rather than the broader community.

Senator LUDLAM —I was not making a comment on that at all. It is just that we have found that within a couple of years of such a list existing it has been hacked and distributed. Are you concerned that this sort of behaviour is likely to continue into the future?

Senator Conroy —As I have said publicly on a number of occasions, if people believe it is a victory for free speech to help disseminate a list of child pornography sites that is a sad reflection on the individual.

Senator LUDLAM —You know that is not where I am going. That is not the question that I asked.

Senator Conroy —It is not something that I support and it will not affect government policy.

Senator LUDLAM —I will take that as a no, that it does not concern you that this sort of activity—

Senator Conroy —I just said it will not affect government policy. You do not have to take it as anything. I actually said it.

Senator LUDLAM —That is a no. I would like to talk about the blacklist, because obviously some of the list that was leaked was not necessarily—

Senator Conroy —Is this the first leak that was claimed to be the list or the second leak, which was more of a closer approximation?

Senator LUDLAM —I will go to either of them because no-one has any way of checking how closely they matched the original, having not seen them. What is the process of getting off the blacklist for somebody who finds themselves on there? Can you appeal your appearance on there or is a site notified? There are a couple of examples that have been used.

Senator Conroy —This is the blacklist that has existed for nine years that you are talking about?

Senator LUDLAM —That is correct, yes. What is the process for getting off that if you are put on it inadvertently or if somebody has hosted material on your website that you were not even sure was there?

Ms O’Loughlin —Generally, if somebody came to us in the first instance to say that they felt that they were on the blacklist for a reason that they did not understand then, of course, we would look at the matter.

Senator LUDLAM —How would they know that they are there? The list is secret and we are not meant to know what is on the list.

Ms O’Loughlin —That is an issue. There are two parts to the scheme itself. Firstly, for those sites we find prohibited located in Australia, their hosts receive a takedown notice, so they are very much aware.

Senator LUDLAM —That is right. It is the overseas hosts.

Ms O’Loughlin —It is the overseas hosted. Very rarely do we receive any correspondence. In fact, it is quite often difficult to find overseas hosts and overseas providers. There is no requirement under the current act for us to notify overseas based providers when we do add them to the filter. The concern over the last few months has been some websites when we have investigated them that have had links through to child abuse images which have been placed there. Their sites have been hacked. They have been placed there by other parties. A couple of months later, in most of those cases, you will find that they came off our blacklist.

In those circumstances it is quite difficult for us because often, particularly if it is child sexual abuse imagery, we have referred those to law enforcement agencies and it is really incumbent on us not to do anything with those sites until law enforcement agencies have finished their investigations. It is quite a difficult area for us. We try to handle it by this regular review that we do of the URLs to make sure that if those links no longer provide access to prohibited content we remove them as quickly as we can.

Senator LUDLAM —I will quote the examples that we were aware of earlier this year, MD Web Hosting, a Dental Distinction website and the Maroochydore boarding kennel site. ACMA was basically convinced that the sites had been hacked by criminals and that the material had been put there that—

Ms O’Loughlin —All we are saying is that when we investigated those sites—remembering that we only look at specific URLs, specific pages, not the whole domain—they contained links to child sexual abuse material, so they were added to the black list at that time. As we have previously stated, they were also removed from the black list when we reviewed that black list a couple of months later.

Senator LUDLAM —Is it a coincidence that those reviews took place after the list or some form of it had been made public and for what period of time were they removed—

Ms O’Loughlin —They were removed in May 2008.

Senator LUDLAM —Was what was floating around in the release later an old list that was not reflective of your current list?

Ms O’Loughlin —I think we have been clear before that some of the material that appeared on that list was not—

Senator LUDLAM —You cannot be held responsible for what people may have done with it once it was leaked.

Senator Conroy —The Broadcasting Services Act sets out the regime which requires ACMA to assess online content. It also sets out the mechanism for the ACMA black list, and this has been in place since 2000, as I have already mentioned. The government is considering options for greater transparency and accountability in respect of the black list. It is not possible to publish the list as it contains links to child sexual abuse material and this would be a criminal offence. We are considering options which could include a regular review of the list by a panel of eminent persons or a parliamentary committee or a review of all URLs by the classification board. These issues will be considered along with the pilot trial on filtering before the government makes final decisions on the implementation of the new policy.

Senator LUDLAM —Can you tell us what you are reading from there? Is that a press release or is it an internal document?

Senator Conroy —No, it was my notes.

Senator LUDLAM —Thank you for that.

Ms O’Loughlin —If I can just add also that any person who is adversely affected by our classification decision can apply for review of the decision to the Commonwealth Ombudsman or the Federal Court obviously. Where we have gone to the classification board for an assessment they can also go to the review process through the classification review panel board as well.

Senator LUDLAM —I guess I would go back to where I started with this, which is that because the list is secret for the reasons that you have both outlined, certainly in the case of the examples that I just mentioned, they were not aware that their sites had been hacked until they read about it in the media. Because the list itself is secret your rights of appeal are a bit limited.

Senator Conroy —That is not quite right. I was on the Insight program with one of the gentlemen whose site had been hacked and he clearly knew well in advance of the recent publicity that this site had been hacked and in fact described on the program how he had had to change his ISP provider and redesign his site. He certainly seemed to have known in advance of the publicity from when the alleged list was published. That was certainly the impression I got. I am not sure whether you watched the program. Hopefully you have better things to do with your evenings—

Senator LUDLAM —No.

Senator Conroy —But that was certainly what I think he described or it was certainly the impression I got of what he described.

Senator LUDLAM —If I could just come back to you, Ms O’Loughlin, about the actioning of what you do? Under your act you are required to refer some of this material to law enforcement agencies. What is the split between the material that you track on your list hosted locally and hosted internationally?

Ms O’Loughlin —The list only includes those—

Senator LUDLAM —What I am interested to know is what proportion—

Ms O’Loughlin —The large proportion of things we investigate are overseas hosted content.

Senator LUDLAM —The overwhelming proportion?

Ms O’Loughlin —The overwhelming proportion.

Ms Wright —If I could add to that, as to the URL you referred to, Dental Distinction, I think we mentioned whilst it was taken off our list in May, that web page and those from a number of other Australian businesses were all hijacked, if you like, at much the same time. There were about half-a-dozen hijacked in January 2008. However, we were satisfied that the material that was being driven through those web pages was hosted overseas, so technically they met the requirement to be listed because they were hosted overseas even if they appeared to be hosted here. That was a phenomenon that happened in January 2008, so we had a handful of URLs that had been referred to that may have been on the list at that time in some form. As far as we are aware, that phenomenon of hijacking sites is really a compliment I think to the way Australia conducts itself that organised crime thought it would be able to fly under the radar by driving that material through Australian hosted sites because we have such a good reputation here. But we did work around this hijacking of sites with the Australian High Tech Crime Centre and with the Internet Watch Foundation in the UK and a lot of public attention was brought to that phenomenon around the world and that practice appears to be passe. As you asked how many URLs on our list would relate to Australian businesses, there were a handful at a particular point in time. That has now passed. We would understand that the list contains overseas hosted material, perhaps a little more transparently overseas hosted than in this case where it might have appeared there was an Australian presence.

Senator LUDLAM —But for the most part anything hosted locally is hit with a take-down notice long before it gets onto this list; is that right?

Ms O’Loughlin —Yes, it would go onto the list. It would be subject to a take-down notice. We have had over 7,000 complaints since the scheme commenced in 2000, and I would say the vast majority of that would be overseas hosted.

Senator LUDLAM —Minister, have the comments that you made before about proposed reviews of the way the list is set up and so on been subject to a public announcement or are we hearing about that for the first time?

Senator Conroy —No. I did not watch myself on SBS Insight after the program was taped because it was actually pre-recorded, whereas I understand it is normally live. But I think I indicated that on the Insight program. I say that not having watched the final cut, but certainly I indicated that in front of the audience and I am assuming it went to air. But I know they did cut some of the discussions.

Senator LUDLAM —Will the proposed measures that you outlined briefly for us before be subject to any form of consultation or are you just anticipating an announcement down the track?

Senator Conroy —No, I am happy to have suggestions on improved transparency. As I said, if we are moving from the current system to a new system which is more robust, I think it is a reasonable proposition to suggest that there could be more stringent accountability measures.

Senator FIELDING —Has ACMA begun its review of the antisiphoning laws?

Ms O’Loughlin —That is a review to be conducted by the department.

Senator Conroy —We are due to release a paper on that shortly.

Senator FIELDING —I may need to come back to that at some other stage.

Senator Conroy —I am guessing, but I do not think that will be tonight just to save you possibly worrying about it tonight.

Senator FIELDING —I do not know whether this is to do with ACMA or not, but it deals with the technology routinely used overseas to save lives by calling triple-0. Can you just walk me through that? I know there have been some reports in the press about some action happening there with technology that providers can provide and there was some blaming of ACMA for not having laws in place? Do you remember anything about that? There was an article in the Weekend Australian on 22 May?

Senator Conroy —I think you might be conflating two issues. There was an argument about early warning and then there was the triple-0 issue. I think they are two separate issues. Could you just identify which of those you are interested in.

Senator FIELDING —It is the one that ACMA is being—

Senator MINCHIN —I think you mean the triple-0 tracking.

Ms O’Loughlin —I think there has been a longstanding discussion around whether there are technology solutions for location information. I think that is what that issue was in regard to. The ACMA and its predecessors have been looking at this issue for quite some time with industry. There are various claims made for various technologies, for example, things like GPS which I think is what was proposed in those circumstances. Our research has found that there are various technology solutions put forward which have advantages and disadvantages, which are less or more reliable, and which have less or more cost. It is a very complex area. I think it is fair to say generally with emergency services that we work very closely with the emergency service organisation. We work very closely with the emergency call provider, Telstra, to try to work out the most appropriate solutions. On the best advice available to us currently there are still concerns about the accuracy of using location based information systems.

—I appreciate the answer because it is in part of your quote. It was about the triple-0 operators’ ability to pinpoint callers from mobile phones. That was what the issue was. It was a very emotive issue. The claims were made. The claim was that the technology, routinely used overseas to save lives—with ‘routinely’ as the emphasis there—could have been implemented if the Australian Communications and Media Authority had forced phone carriers to update their networks. Your response is very similar to what has been put forward. I have the following article from 2 May this year in the Australian:

Have you got a report? Have you done some investigations? Has the department actually done a detailed report on this at all? Is it just your thoughts?

Ms O’Loughlin —The predecessor to the ACMA, the Australian Communications Authority, did a report back in 2004-05. We have been keeping across the issue since then. The technology has not necessarily advanced that much since that time, but it is something that we have got under active consideration and discussion at the moment.

Senator FIELDING —That report was public at the time; wasn’t it?

Ms O’Loughlin —It was public, yes.

Senator FIELDING —Can you provide any update for the committee at all? You said it was ongoing and that you are looking at it. What is the latest on it?

Ms O’Loughlin —As I mentioned to you, I think we are still finding that there are various technology solutions that have advantages and disadvantages in terms of their accuracy and their use in the Australian context as opposed to overseas context. We have a very different topography and network infrastructure here. We are keeping ourselves informed about it and it is something that we are discussing in an ongoing way with the emergency service operators, the emergency call service provider and the carriers.

Senator MINCHIN —To your knowledge has any comparable country with similar topography at least, such as Canada or the US, imposed this?

Ms O’Loughlin —I think there have been varying degrees of success in terms of introduction. There are overseas countries that have imposed requirements, but on our investigation it is not quite clear how that is being complied with or enforced. That is one of the issues for us. We want to make sure that if there is something done in this area there is compliance and enforcement. I think it is a very complex issue. It is a very emotive issue. I think it also highlights some of the ongoing issues that we face with technological change of the increased use of mobiles and the increased use of things like VoIP. The government’s NBN regulatory discussion paper also raises some of these issues about emergency services and the future of emergency services, so I think it is going to be very much a live debate and a time for us all to look at our processes to see whether they can be improved.

Senator FIELDING —The same article referenced the advisory—

Ms O’Loughlin —The Emergency Call Service Advisory Committee?

Senator FIELDING —Yes. There is a quote here from Dennis Luttrell, a member of the advisory committee, who said, ‘It is absolutely frustrating. It’s technically possible.’ Isn’t it your own advisory committee urging you to do something with this? I am trying to work out the story behind it.

Mr Chapman —You are right, that is an advisory committee of ours. The chairman of that advisory committee is our deputy chair.

Mr Cheah —ECSAC is an advisory committee which comprises most of our stakeholder groups. Mr Luttrell happens to be one of those. He happens to chair another group of organisations called the National Emergency Call Working Group, NECWG. They tend to have involved a lot of the emergency service organisations, so he is representing a perspective from one of our stakeholders. That is his view. As Ms O’Loughlin has already explained in some detail, our view is that we have been looking at the range of different technologies and there is a raft of issues with them. I do not think we probably agree with the proposition as baldly put as it appeared in that article in the Australian.

—I am a senator from Victoria, and Senator Conroy is too. In relation to the fires, I will not go there; but you can imagine how someone who was involved or had friends or relatives involved in the bushfires would feel upon reading this statement, this quote from a person on this advisory committee where they say:

I hear what you are saying—that it is complex, expensive and may have reliability gaps—but I am just saying technology has changed pretty fast and the words ‘routinely used overseas’ prompt me to try to work out again in 2009 what is so different about the way that we run our systems here compared to overseas.

—As I said and as Ms O’Louglin has already explained in some detail, there is a range of different technologies. They would get used to a certain extent but they have all got their issues that are associated with them. Certainly a number of them are going to be particularly foolproof. As I said, I do not think we would agree with the propositions that are quoted in that article.

—I have a couple of notes here on the limitations of something like GPS, just to give you some examples. There is a low percentage of handsets with GPS chips on the current market. We estimate that less than 10 per cent of the market for mobile phones has GPS chips. It would introduce a delay in calls of up to 20 seconds while a database is searched, so it is also about that immediacy. It has low accuracy in determining vertical positioning, which I am not going to try to explain but I think that causes problems in metropolitan areas. And GPS applications chew up a large amount of battery, so there is actually the potential for the application to be turned off to preserve battery life, therefore you are not going to have a reliable service.

These are issues that we work through with the Emergency Call Service Advisory Committee. I think we understand that all of us would like an easy solution to some of these matters because they are of great concern to the community. I think we continue to work them through. New technologies present new issues for us collectively—not only for us as the regulator but also for the emergency service organisations, which are state and territory based organisations. I think collectively we try to work with them to solve problems where we are, but I do not think there are any clear answers to the requests.

—At least there have not been. We are hoping that we might be able to work something out looking at things going forward. You are quite right that technologies do move on and business models move on and we may find ourselves, hopefully, in the situation where we can get this information up and running and available and getting the ESOs then to make use of it, because that is another part of the equation which maybe does not quite come out as clearly as it might have in that article as quoted. Information can sometimes be provided to the ESOs but are they always capable of making full use of it as well.

—In terms of some of the things which are unique to the Australian market, there is probably that shared responsibility between Commonwealth, industry and states and territories around the delivery of emergency call services.

—Obviously if you could save one life or maybe help someone—

—Absolutely.

—Then this becomes a cost issue as to compliance and enforcement. If they are stopping us, I worry about that a little bit from there. Those words have been mentioned. Also the state, federal and various bodies are a concern to me. If you are just telling me that it cannot be done, I would really need to question that a bit further because, whether you have got GPS turned on or not, if Senator Conroy went missing I am sure we could find him if his GPS was turned off by using his mobile phone. There is a way of locating—

Senator MINCHIN —Why would you bother?

Senator FIELDING —Some people may say: why would you bother?

Senator Conroy —Senator Fielding knows that he needs a centre forward in the soccer team.

Senator FIELDING —I am not thinking about just a GPS here. You can locate mobile phones without the GPS really and I know there is technology around. I do not want to sort of be pushed aside just because a GPS can be taken off.

Ms O’Loughlin —I can assure you it is an issue that we are taking very seriously and that we continue to look at the technology that sits behind it, because location information is not just an issue for mobile phones; it is increasingly an issue for VoIP services. It is quite challenging but we are aware of the concerns around it and we want to work productively with industry and the ESOs in solving the problems.

Senator FIELDING —Could you maybe provide on notice an update to that 2004 report on the recent technology and the reasons why.

Mr Chapman —We would be very happy to do that.

Ms O’Loughlin —Yes, we are happy too.

Mr Chapman —Just to underscore our shared concern about the genuine tragedies that occurred in those bushfires, and indeed that occur in any national emergency, one area we as an organisation have been absolutley focused on over the last 18 months—and this is related to your question in the sense that I just wanted to demonstrate our concern about this—is the in principle delivery of 27 megahertz of identified spectrum for a government band Australia wide. We announced that in our recent 400 megahertz discussion paper. The word nationbuilding is used here, but I genuinely mean that. I am talking about the opportunity for this country and the emergency services organisations to seize the 27 megahertz identified government band. This is a matter I have discussed with the minister. This is a matter that the minister has put out a media release about. It is more than a once-in-a-generation opportunity; it is a threshold opportunity for this country to completely retool its interoperability across all emergency service organisations.

From the ACMA perspective, we have worked very hard to forge that opportunity and deliver it in our 400 megahertz solution. So that is something we have had a fair bit of autonomy to deliver and we are delivering it. We want to deliver it because the example of the recent bushfire tragedies and the loss of life and property, and the seemingly-increasing incidence of national disasters, underscores the need to take advantage of this opportunity. I just wanted to, given you raised the matter, take the opportunity to reflect on the fact that we have forged that opportunity because we think it should be taken.

Senator FIELDING —Thank you for the update generally there. If you can come back with some sort of update, it would be useful and maybe answer the questions that were left in the minds of a lot of people. The news story in the Australian on 2 May went on:

So I am interested to know whether current technology could have been used to locate that particular lad. It is a question you could actually ask the technology people. I am not worried about the cost here—we will come to that in a moment—I am just interested in knowing about that particular one.

Mr Cheah —I suspect the technology question is relevant to that. As Ms O’Loughlin explained before, there are several different technologies you could potentially use to deal with location issues. Some of them might help in that circumstance and others might not be as useful. The carriers are putting in place some of their own location based technologies for their own commercial reasons.

Senator MINCHIN —They are currently available, aren’t they? If you were a bushwalker, you could commercially obtain a GPS based location service from your carrier, couldn’t you?

Ms O’Loughlin —There are commercial location based services available. Again, that comes back to the interplay between those carriers and the emergency service organisations in the states and territories and whether they have the IT capacity to take the information across. So there is an interplay between the two services.

Mr Cheah —If you get some commercial services that are implementing things in different ways, how will the interface actually work? Is there going to be a common way of doing it? Those kinds of questions start to arise. Ms O’Loughlin talked about some of the complexities and some of the evolving ways the market is working, and that is where some of this kicks in.

Senator FIELDING —What happens with the recommendations from ECSAC? They go from where to where? Can we see them?

Mr Chapman —I have a feeling that we have in principle decided, as ACMA, to put those on our website. Being a transparent organisation would suggest that we should do that. I think we have discussed this, and if they are not there then we have no problem in releasing them.

Senator MINCHIN —Steve was talking about the bushfires. The issue there was not so much someone ringing 000 who could not describe where they were. It was more the issue of getting warning messages to people who had mobile phones and who did not live there but were in the area. That is sort of related but not quite the same issue as the bushfire issue. Where are we at on the matter of the Integrated Public Number Database?

Ms O’Loughlin —In terms of the emergency warning system per se, that is a matter for the Attorney-General’s Department. They have overarching policy responsibility for Commonwealth emergency management response. The government has moved recently to make a legislative amendment to allow emergency service organisations access to the Integrated Public Number Database to allow them to do outward-bound messages, whereas previously they could not use the IPND.

Senator MINCHIN —If you have a mobile phone and your registered address is in Melbourne but you happen to be in Marysville on the day, how does it work?

Ms O’Loughlin —That is the real difficulty. My understanding is some of the support that has been given by the government through the Attorney-General’s Department to an emergency warning system will look at those types of issues. Currently they can only use the IPND to find the people who are listed.

Senator MINCHIN —And known to be in that area.

Ms O’Loughlin —Yes, where their billing address is.

Senator WORTLEY —As part of the budget, the government committed to extending the Do Not Call Register, which is something that Labor has long advocated for. What actions has ACMA taken recently in its role as the enforcer of the register? How is ACMA attempting to proactively promote compliance with the Do Not Call Register?

Ms Cahill —In relation to the Do Not Call Register, as you note, additional funding has been provided to extend the scope of the register to enable the registration of business, fax and emergency numbers. Legislation will be put before the parliament towards the end of this year and ACMA, as a result of that hopefully being passed, will seek to implement the expanded register at the beginning of next year. In relation to the actual compliance levels with the current requirements of the Do Not Call Register, ACMA has a very good and positive story to tell in relation to the activities it has undertaken over the last 18 months in particular. As I noted at the last committee hearing, we have been successful in achieving a very highly compliant sector more generally. As you would appreciate, the provisions of the Do Not Call Register actually touch large sectors of this community that previously would not have realised they were caught by this legislation. We have put in place a strategically targeted enforcement, education and compliance approach. We have achieved approximately a 60 per cent reduction in complaints for the second year of operation of the register.

As we have also noted, our biggest areas of concern were around telecommunications service providers, and we have targeted our compliance action over the last 18 months to those areas. We have seen, again, a drop of about 60 per cent in the level of noncompliance, measured by complaints to ACMA associated with telco providers. As I say, we have been very pleased with the results of our actions. To that end, we have taken very direct enforcement action by issuing seven infringement notices; accepting and negotiating nine undertakings; issuing seven formal warnings, so we put a range of industries on notice; and issuing, over the last 12 to 18 months, 1,130 formal letters to those who have been complained about. We have also taken the time to educate the sectors who are covered by this regulation. In July we are going to issue a better practice guide, so we will be providing a guide to those industries that are seeking to have best practice. We have provided information and fact sheets and have run a series of education campaigns aimed at particular market segments. Our latest campaign has been aimed at the real estate industry. As I say, we have a very good story to tell about the level of compliance with the Do Not Call Register and the activities of ACMA and those industries who have been involved in it.

Senator WORTLEY —Thank you very much. I had other questions, but in your very thorough answer you provided the answers for me.

Senator MINCHIN —The budget, as you mentioned, provides for an extension of the Do Not Call Register. Could you specify to whom the list will now be extended? If you are you able to tell us, could you also tell us why they were not originally included?

Ms Cahill —The extension will now mean that people can now register business numbers, fax numbers and emergency service numbers on the register.

Senator MINCHIN —You could not previously register a fax number?

Ms Cahill —No.

Senator MINCHIN —I am just trying to recall what the reason for that was.

Senator Conroy —You would have to ask yourself.

Senator MINCHIN —I was not responsible for the policy at the time.

Senator Conroy —Can I give you Helen’s phone number?

Senator MINCHIN —I would interested to know if you moved an amendment in the Senate.

Senator Conroy —The department might be able to help on the substantive issue.

Senator MINCHIN —You did not move an amendment to include fax numbers when the legislation was in the Senate?

Senator Conroy —I do not think I did on fax numbers.

Senator MINCHIN —I wonder whether anyone recollects the policy reason for excluding fax numbers and why that is now not a problem.

Ms Cahill —In its first year of operation, there were a range of issues raised regularly with ACMA, as the manager of the Do Not Call Register. As a result of that and feedback to the department, the department issued a discussion paper midway through 2008.

Senator Conroy —’You caved in to industry pressure’ is the polite way of describing it.

Senator MINCHIN —You must have too.

Senator Conroy —No, we are moving ahead with an enhancement of your policy.

Senator MINCHIN —Did ACMA at the time say: we want to suck it and see and take this one step at a time, rather than doing the whole shebang.

Mr Cheah —No, it was a policy decision.

Senator MINCHIN —But you must have been providing advice as to what you were capable of doing in the first instance in setting up this register. So now it is all fax numbers and all businesses.

Ms Cahill —Yes. There will be an exception for those businesses where there is a relationship. For example, if someone is a plumbing supplier, they will be able to call plumbers to offer their services et cetera. We need to not in any way inhibit the normal flow of commercial business.

Senator MINCHIN —There has been some adverse reaction to this from marketers saying it will inhibit businesses. Have you done some sort of impact analysis of this? What is the impact going to be?

Ms Cahill —The full scope of issues were canvassed in the discussion paper that the department issued and the policy position has been put forward that that is the way to move forward.

Senator MINCHIN —So the direct marketing organisations will have an opportunity to have their say on this before it is done?

Mr Cheah —That is correct. As Ms Cahill explained, the department put out a discussion paper. The submissions came in. The department considered those and advised the government, and it was part of the government’s decision making. We are simply now implementing the changes to legislation as they are being set up.

Senator MINCHIN —You are going to fully recover the costs of this? I see it will cost you a remarkable $2.3 million in the next financial year to set this up. It seems a lot of money, and then the ongoing costs are basically $700,000 a year. Can you tell me why it will cost $2.3 million in the first year?

Ms Cahill —That would be issues of ensuring that the software is in place to expand the register and any administrative issues in terms of determination, legislation, et cetera. That will be the direct cost. ACMA does not recover the enforcement and compliance costs, so that is the differential between the money provided and the direct cost recovery.

Senator MINCHIN —Once it is set up, you say your ongoing costs will be $700,000 and you will recover $700,000.

Ms Cahill —Yes.

Senator MINCHIN —Once you have set it all up, what are those ongoing costs of $700,000? Is it just staff costs?

Mr Cheah —We do it by means of an outsourced contract supplier. So we have to get the contracted supplier of the register to change their systems. We are going to be increasing the scope and volume of the work which they will have to do because there will now be more businesses and more numbers added onto the register. They have clearly got a bigger load of business, and so those costs are basically reflected in that way.

Senator MINCHIN —Take me through how you recover those costs.

Ms Cahill —The cost recovery elements actually come from the subscription charges. We annually seek an independent review of the expected use of the register as well as what we know are the direct historical costs. Our independent advice does a forward projection based on the subscription numbers. We then publish those details, seek advice and consult with our industry on it before we actually set the cost recovery fee, which is actually the annual subscription fee.

Senator MINCHIN —If a bloke with a plumbing supply business wants to let all plumbers know of his wonderful product, what is he now going to have to do?

Ms Cahill —He will probably seek to wash his list and he would take out a subscription. We offer approximately seven different subscription types. He probably would be looking to wash a maximum of 500 names through his list, and given he would only take out a subscription type A there would be no cost to him. If, however, he was a very large plumbing supplier, for instance, and wished to submit a list of about 20,000 names, his annual subscription fee would be $78.

Senator MINCHIN —So a relatively modest charge.

Ms Cahill —It is for smaller, but it escalates. If you want to have a subscription for 100 million numbers, you are looking at $88,000.

Senator MINCHIN —How are they going to know they have to do this?

Ms Cahill —We will again go through, as we did when it was first introduced, a very detailed education and awareness campaign.

Senator MINCHIN —I can imagine it will take some time for businesses to know they are going to have to do this.

Ms Cahill —We now have the next six months or so to move forward with our awareness campaign, and we will do that.

Mr Cheah —During the first period of operation of the register, when it first came in, obviously we started to get complaints. We tended to adopt a slightly more lenient attitude in that very first period of firstly telling people, ‘These are your obligations,’ in case they were not aware of it. You quickly find out when you have a problem with a serial offender or people who are not taking things seriously, because there are a number of people who just innocently do not know that they have got these new obligations and we adopt a pretty sensible attitude to that.

Senator MINCHIN —You have the discretion to do so?

Mr Cheah —Yes. As Ms Cahill also referred to, we have written a lot of formal letters. Sometimes we would raise things informally but we can also write to them.

Mr Chapman —We have a five-tiered approach to enforcement and compliance. We do it on a basis that is appropriate to the circumstances. It worked very well last time and we would anticipate going through that same process on this occasion. I think we have washed something like 2½ billion numbers.

Senator MINCHIN —Billion?

Mr Chapman —Billion numbers so far.

Senator BIRMINGHAM —Once these changes are in place, what level of revenue will you be generating annually from the telemarketing industry?

Ms Cahill —It is a cost recovery basis. There will be no revenue generation for ACMA.

Senator BIRMINGHAM —What level of revenue will you be taking in to meet costs?

Ms Cahill —We have already indicated that we will recover approximately 74 per cent, or $3.46 million, for the additional functionality. Of the $4.7 million that is going to be provided—

Mr Cheah —That is $3.46 million over four years.

Senator BIRMINGHAM —So $3.46 in revenue will come in over four years as a result of the additional functionality?

Ms Cahill —Yes.

Senator BIRMINGHAM —Once we get out to 2011-12 and it is just operating on an annual basis with the existing functionality and new functionality, what will the ongoing annual cost be and therefore presumably the ongoing annual revenue?

Ms Cahill —The total cost of the register initially is $28.8 million. The additional $4.7 million takes our fees up to $32.7 million. The total cost recovery element over the life of the project will be $13.3 million, I think, but I need to possibly take that question on notice and get the detail back to you.

Senator BIRMINGHAM —If you could, please. I understand the higher establishment costs and so on but I am interested in the out years and what the annual cost and the annual fee to industry will be once it has settled down and is not lumped together in four-year estimates or whatever. I am interested in that annual fee for the out years. What level of complaints are you receiving now for noncompliance?

Ms Cahill —As I indicated in my previous answer, complaints for ACMA have dropped by about 60 per cent. In the quarter from January to March 2008 we received 1,701 complaints and in the period January to March 2009 we received 689. Total average complaints or total complaints received by ACMA in relation to the register are now—

Senator BIRMINGHAM —That is okay. I do not necessarily need the total complaints—the comparative for those quarters is fine. I apologise if you answered this in response to Senator Wortley before, but do you attribute that change, that drop in complaints, to greater adherence by industry or to the fact that the register is not as high profile as it was at the outset, or a combination of both?

Ms Cahill —I think the register is still as high profile as it was at its launch. We have seen a steady increase in registrations to the register in the last quarter. As you may recall, there was a spurious email going around suggesting that people’s mobile numbers were about to be released. It actually increased registrations, so we see elements like that where there is a generation of people’s interest in registering. I believe we are seeing the result of a very effective compliance, enforcement and education campaign hitting the mark in terms of a compliant industry.

Senator BIRMINGHAM —If somebody put their number on the register two years ago, is there any reminder to them that their number is still on the register?

Ms Cahill —No, the current registration is live for a three-year period.

Senator BIRMINGHAM —It is live for a three-year period and then they are told it is about to lapse?

Ms Cahill —That matter is being considered at the moment in internal discussion between ACMA and industry as well as with the department.

Mr Chapman —That first three years comes to May 2010, so we have not reached that point yet. It is a matter and a process to be worked through.

Senator BIRMINGHAM —I would have thought it made sense to tell people that their number was about to lapse. In terms of ensuring that people remember who to complain to and so on if they suddenly find themselves getting calls, I would have thought that some sort of mechanism for reminder that they have this tool and facility and have registered for this, might be a useful addendum to the policy as well.

Ms Cahill —As the chairman indicated, we are looking at all those issues as part of the ongoing management of this program.

Senator BIRMINGHAM —Okay, thank you.

CHAIR —Any further issues for ACMA? Senator Minchin.

Senator MINCHIN —Have you discussed some of the budget load measures, particularly with cost cutting? I notice with some parochial alarm that you are being required to close your Adelaide and Perth offices. Could you just explain what that will involve, how many staff will be affected, what effect it will have on your operations, and what the current roles performed in those Adelaide and Perth offices are? This is cited as being means by which ACMA’s already, I am sure, very high operational efficiency will be ‘improved’. I am interested in how that will be brought about, how this closure will improve your operational efficiency.

Mr Chapman —The closures will generate annual savings as set out in the budget papers.

Senator MINCHIN —Savings are different to operational efficiencies. You might save money but be more inefficient. Should that just read savings should it?

Mr Chapman —I will go back a step. The service delivery model that we commenced with the closure of six of our operations offices last year has proved very effective. The closure of the Adelaide and Perth offices brings forward the utilisation of that service delivery model to those states. We have been monitoring the closure of those six eastern seaboard offices since we took that decision last year to assess whether there has been any loss of service to citizens and customers. Our conclusion is that there has been no impairment to delivery of services. We will be taking that same service delivery model and employing it in the states of South Australia and Western Australia which is essentially to deal with it on a combination of fly-in and fly-out, better access of the diagnostic tools we have developed. The whole way in which the technology has moved is a combination, if you like, of people being able to better work around interference issues and having more portable equipment. We have found with respect to our six eastern seaboard office closures that it has not impaired the delivery of service and we anticipate that will be the case now in South Australia and Western Australia.

Senator MINCHIN —Could you just remind us of what actual services are performed out of those two offices?

Mr Chapman —Yes, there are three staff affected in Adelaide and there are 10 staff affected in Perth. We have offered all those staff redeployment within the organisation. We would like them to stay within the organisation. We realise that—

Senator MINCHIN —Where is the nearest office to Perth?

Mr Chapman —We realise that that is not going to be practical for a great number of them. What I am saying I guess, Senator, is if they saw their way fit to move to Melbourne or Sydney or Canberra offices—

Senator MINCHIN —You will have those three offices left?

Mr Chapman —We have got the Canberra office as well. They are the three offices that essentially we deploy with respect to signal or interference issues, which is really what these staff are doing; they are field offices for interference related aspects. They do not have a customer facing role in Adelaide or Perth and have not for several years. We are moving over time to one point of entry to the ACMA. The Adelaide and Perth offices have not been used in any front of house sense for quite a while. Having kicked off the initiative last year with our new service delivery model, this is the next iteration of that model.

Senator MINCHIN —Why do you need $700,000 this year to save the money? What is that all about?

Ms Carlos —Senator, that runs to the cost of closure of the offices. It encompasses the possibility of redundancy costs, payout lease costs, removal of the equipment and the like, so that is what the funding is for in the 2009-10 financial year. The savings are then delivered beyond that year, estimating around $900,000 in the out years.

Senator MINCHIN —How does that relate to the switch to digital? It is interesting that you do this at the very time. For example, in South Australia you are heavily involved in the switchover. I know there are parts of my own state very concerned about loss of television signal. How will they be reassured that closing down the office at the very time we are going through all this is not going to diminish the responsiveness of government to their concerns?

Mr Chapman —We have a very strong program with respect to the digital field measurement and signal strength that we have been going through, and it has got a number of layers to it. That is being handled by a completely different set of staff within the organisation using different equipment under different sections of your organisation. These closures will not in any way impair a digital switchover.

Senator MINCHIN —So these people in these offices are not involved in that—

Mr Chapman —Some of them are at the moment but they do not need to be. The progress that we have been making on the digital switchover means that it will not be impaired. We have done something like 2,210 location measurements already across all states and territories. That is being done by a different group within the organisation and that will continue to be the case as we move forward over the next several years. I understand the question and there is a raising of the eyebrows because initially one would think, ‘Well that would run contrary to what you are trying to do,’ but they are effectively unrelated disciplines within the organisation.

Senator MINCHIN —I presume this is a saving you offered up; it was not extracted from you by a CRC?

Senator Conroy —That would go to advice to government, Senator Minchin. You are very familiar with the workings of government, so I am sure you would understand that it would be very inappropriate for Mr Chapman to offer to answer that.

Senator MINCHIN —If this is part of Mr Chapman’s vision and strategy of his organisation, he would be more than happy to indicate to the committee that this is very much part of his planning for an efficient organisation.

Senator Conroy —They are welcome opinions of yours and I am pleased that you recognise Mr Chapman’s vision and abilities.

Senator MINCHIN —But you refuse to let him answer the question.

Senator Conroy —I think you have asked him about his advice to government. I am not sure it is a question that he is in a position that he can answer.

Senator MINCHIN —I noticed also that the so-called Gershon review, that was the IT review I think, has required you to deliver savings. I presume this does not go to advice to government. It is in there. I presume they were not something you offered up but were extracted from you. It will not destroy your organisations, it is a couple of hundred thousand a year, but what is that all about? Where those savings are to come from? Why is it that you are able to make those savings? Are they to be delivered on top of the efficiency dividend which, from my recollection, does apply to you?

Senator Conroy —Gershon applies across the government as a whole I believe.

Senator MINCHIN —Every agency.

Senator BIRMINGHAM —And is on top of the efficiency dividend.

Ms Carlos —Thay is correct, Senator.

Senator MINCHIN —And these are ongoing I presume? How will you derive those savings?

Mr Chapman —I might ask my general manager of corporate services to address that.

Ms Carlos —The 2½ per cent of our business-as-usual cost of IT services is the saving that we have to provide for 2009-10—that is, $206,000. The ACMA will deliver those savings through extending the useful life of our desktops, looking at virtualisation of our server arrangements, looking at savings out of our IP-telephony area and recontracting our LAN support services. They are the particular items that we have targeted for the next 12 months to deliver those savings. We then will review through the course of the next six months or so the extra savings to bring us up to the 7.5 per cent for future years. They are the items that we have targeted at the moment. Where they come from is for us to actually find in the cost of our services. That is ongoing.

Senator MINCHIN —These are presumably the areas you would have been looking at in terms of meeting your efficiency dividend obligations, wouldn’t they be?

Ms Carlos —We look at all areas of the organisation to try and find both those savings, yes.

Senator MINCHIN —What is the efficiency dividend on you at the moment?

Ms Carlos —It is 1¼ per cent ongoing, and there was the one-off two per cent dividend last year.

Senator MINCHIN —That was last year. What does this Gershon efficiency dividend equate to?

Ms Carlos —For an agency our size, it is 2 ½ per cent of our business-as-usual cost this year.

Senator MINCHIN —Of your IT costs? What does that equate to in terms of the effective increase in the efficiency dividend?

Ms Carlos —I do not have that calculation, but I could take that on notice.

Senator MINCHIN —I wouldn’t mind that. Thank you.

Senator BIRMINGHAM —How much is the efficiency dividend in value terms for the agency?

Ms Carlos —It is 1¼ per cent.

Senator BIRMINGHAM —In dollars?

Ms Carlos —That is estimated to be about $1.1 million.

Senator BIRMINGHAM —So $1.1 million and Gershon is $206,000 in 2009-10.

Ms Carlos —Yes.

Senator BIRMINGHAM —Answers to questions on notice indicate potential savings of $620,000 in 2010-11, $630,000 in 2011-12 and $630,000 in 2012-13.

Ms Carlos —Yes.

Senator BIRMINGHAM —Are those potential savings reflected in the budget allocations for ACMA in the forward years?

Ms Carlos —Yes. They were put through the system when this was put through with the budget process.

Senator BIRMINGHAM —So the allocation to ACMA is less in those forward years by $620,000, $630,000 and $630,000?

Ms Carlos —That is correct, and you can see in the portfolio budget statements. There is a measures line in that document on page 121—no; sorry. It is a saving that has been taken out of the base, and there is a footnote on page 122 that itemises those dollars.

Senator BIRMINGHAM —I see that and the last one on page 122. In the answer to the question on notice, those forward years are described as ‘potential savings’ but the money from those potential savings has been taken out of the base funding for ACMA. You are confident that those potential savings can actually be found?

Ms Carlos —Yes, we are.

Senator MINCHIN —On another budget measure: I just want clarification on the Australian Communications Consumer Action Network, which you are not responsible for but which I see you are responsible for funding. It has been given a rather remarkable sum of $7.5 million over four years, which you are to recover from annual carrier licence charges. You are aware of that?

Mr Chapman —Yes.

—That is going to be $2.1 million a year. Will legislation be needed to increase that? How is that set? What proportionate increase in your charges will there be?

Senator Conroy —Could I say this while Mr Chapman is considering that. There was a general view across the industry that the consumer voice was perhaps not as strong as it could have been and—

Senator MINCHIN —Do you mean including among the carriers?

Senator Conroy —Yes. To be fair, it was across the industry. When it was proposed to reform into ACCAN there was general acceptance. I am sure you would have heard of it if there was not. The general view across the sector was that there was a need to lift the profile, and that required extra funding. Quite a lot of consultation went on. I am pleased to say that the industry was generally supportive of the measure, which I suspect is why you have not heard a lot about it.

Senator MINCHIN —No, I have not. I acknowledge that; I concede that.

Senator Conroy —CTN has been reformed with a number of other organisations to become ACCAN.

Senator MINCHIN —And the carriers understand and accept the costs—

Senator Conroy —As I said, I am sure if they were unhappy you would have heard about it. There was a general view.

Senator MINCHIN —They might not have wanted to get offside with the all powerful minister!

Senator Conroy —I have never noticed the carriers to be shy.

Senator MINCHIN —You are a very intimidating character.

Senator Conroy —Please.

Senator MINCHIN —How is that additional charge to be collected? Will it require legislative amendment?

Ms Carlos —In respect of that, the department as part of the annual carrier licence charge provides us with a determination and that determination becomes part of the charge that the authority then approves, and we invoice the carriers. There are a number of components.

Senator MINCHIN —Is the determination a legislative instrument?

Ms Carlos —I am not sure. It is probably a question more for the department.

Mr Chapman —The minister’s determination.

Senator MINCHIN —Yes. I assume it is a disallowable instrument.

Senator MINCHIN —I do not know what you collect from them. Is 2.1 a tiny proportionate increase?

Ms Carlos —From memory, and I will correct this if it is not right, the annual carrier licence charge is in the order of $30-odd million.

Senator MINCHIN —That is not insignificant. That is all I have on that.

CHAIR —Senator Minchin, we are almost ready to go to the tea break. If you can do two minutes worth, you can.

Senator MINCHIN —I just want to quickly raise this with you. Others may have questions on digital TV, although many of them will be for the department or the task force. It has been suggested to me that there is an issue in the Gunning and Cullerin areas of New South Wales, with the Cullerin wind farm interfering with digital TV and mobile phone reception. I have been specifically asked to raise that with you. I was not aware that wind farms could affect that. I am not a great fan of wind farms but I did not know they were so bad that they could bugger up your TV.

Mr Chapman —Before you asked that question, we thought we were going to have the unique experience of not hearing from Mr Tanner.

Senator Conroy —You have brought this upon yourself!

Mr Tanner —Sorry to disappoint!

Senator MINCHIN —It’s better to have Giles and not Lindsay, anyway!

Mr Tanner —Was it Gunning and Cullerin wind farms?

Senator MINCHIN —Yes, Gunning and the Cullerin wind farm.

Mr Tanner —I would make the general comment that anything in the landscape—potentially trees, buildings and what the engineers tend to call clutter, which would include a wind farm—can affect propagation through the obstacle and it can have reflections that were not there before. As a matter of principle, it is possible that the existence of any large building could have an effect—it is likely to be a very small effect—on coverage or reception of a radio communications facility. However, I do not have any specific information here. I would have to take the question on notice to see what we know about that.

Senator MINCHIN —Could you? But it is generally true that wind farms can affect reception?

Mr Tanner —There is no more to it than this. It is also the case that, whenever you build a tall building in the Gold Coast—

Senator MINCHIN —Whether it is a tree or a building, yes.

Mr Tanner —you are probably going to affect television reception in various ways. With analogue, you might cause reflected signals; you may cause a deeper shadow behind that building. Any infrastructure on the ground is going to have an effect on certain types of signals. There is nothing special to wind farms that I am aware of, but the specific instance I will have to take on notice.

Senator MINCHIN —Except they tend to be built on bare hills and affect country people as a result. It is not the Gold Coast. Are you aware of whether or not you are typically consulted by planning authorities on the effect that wind farms may have on telecommunications?

Mr Tanner —In general, building wind farms are a local planning issue, but so is building office blocks and blocks of flats. All those things potentially affect radio propagation. We are not a town planning authority. We are a spectrum regulating authority. So, no, we are not routinely consulted.

Senator MINCHIN —So there is no reference to you whatsoever?

Mr Tanner —If it is referred to us it is because there is an issue raised by people in the community seeking information. That has occurred over time with respect to some bits of infrastructure over time. But in general, no, we are not involved in the approval of buildings, structure. That is a town planning matter, typically a state or local government matter.

Senator MINCHIN —But it is more than just a building thing. Wind farms are proliferating. The key unresolved or difficult area politically and socially with digital TV is the regions.

Mr Tanner —Yes.

Senator MINCHIN —Wind farms and their proliferation are more likely to become quite an issue. I suspect you may need to be more involved in this, but—

Mr Tanner —It is possible. I would be surprised if it is, as you say, quite an issue, given the large area of the country and the relatively small area occupied by wind farms, generally in lightly settled areas, but I am happy to take that aspect of the question on notice as well. We have certainly not been aware of a large amount of wind-farm related complaints relating to either mobile or television reception. I believe there have been particular concerns in one or two instances that I can think of. I just cannot recall if Gunning was one of them.

Senator MINCHIN —What is the technical answer to that? Can you put some sort of relay or reception facility on a wind farm?

Mr Tanner —It depends on the particular signal, the particular band that is being used and its propagation characteristics. It is going to depend entirely on local circumstances. It is also the case that marginal mobile reception can be affected by planting a grove of trees between yourself and the base station, but we are not involved in clearing groves of trees. It is all clutter, as the engineers say. It is characteristics of the landscape can have some effect on radio frequency reception. At the margin of reception, some new piece of infrastructure or even the ending of a drought and a lot of vegetation growing up is going to have an effect on the size of the very outer limits of cells of mobile telephony. Yes, a wind farm hypothetically can affect reception of certain services. As to whether this is some major problem, I am much less convinced of that. As I say, we do not have a formal role unless the device is a radio communications transmitter or emitter, in which case, yes, we are directly involved.

Proceedings suspended from 9.34 pm to 9.50 pm

CHAIR —Thanks, everybody. Senator Birmingham.

Senator BIRMINGHAM —Thanks, Chair. I have two issues. Firstly, we will deal with the big picture. One last budget measure about which I wanted to inquire is the ‘digital dividend—technical planning and restacking”. Are the funds provided there purely for ACMA in undertaking and implementing the planning and restacking or, if you need to shift a broadcaster from one frequency to another, do they go somewhat to subsidising the cost of that shift?

Mr Chapman —They are related to the former, not the latter.

Senator BIRMINGHAM —They just seemed to be quite large sums for the process. I do not understand what is involved in that process entirely, but $6 million and $7 million in two of the years involved seem to be large sums for a planning and restacking exercise. What exactly is involved in restacking?

Mr Chapman —There is an extraordinary amount of work to do. Depending on how much time you have, maybe Mr Tanner can take you through the essence of what the digital dividend from restacking is as a starting point and then perhaps we could give you a layered understanding of the sort of work the ACMA will be doing in the digital switch-over and digital dividend.

Senator BIRMINGHAM —I do not want to hold up the committee for too long, and I am very—

Mr Chapman —No, just for a couple of minutes.

Senator BIRMINGHAM —Sure, Mr Chapman. I am sure that would be useful.

Mr Tanner —The idea of restacking is that when analogue television is turned off you are left with a large piece of spectrum that has now vacant analogue television channels here and there. Pretty well the only economic use for those channels would be for additional television services. To realise a dividend which is of use for a wider range of other types of services and, therefore, potentially of greater value to the community, you need to take advantage of the ability of digital channels to function perfectly well packed down or packed up directly side by side by moving the broadcasters, restacking them into a configuration in which you get the same amount of digital services and digital coverage but freeing them up by moving digital services from some bands into the vacant analogue spaces. You free up a larger block of contiguous spectrum in an area where you decide that that is a desirable thing to do. I should make clear that what I have explained to you is hypothetical as the actual decision-making process around what that dividend might be is a policy process, which the government is currently working on. The government and the department are the appropriate people to talk further about that. What we do know is that the government is proposing to go down a dividend path which will involve restacking, and, accordingly, we have a significant engineering challenge for which we are not presently equipped. That engineering work needs to be done fairly swiftly if we are not to have the realisation of the dividend delayed well beyond 2013, when analogue services stop.

What the engineers do is a bit of a black box, but, in essence, a task of similar size has already been done once, and that was the process by which we found digital channels for all existing broadcasters to operate during the simulcast period at the same time as analogue. The way that was done was that the ACMA developed allotment plans for channels called digital channel plans. It then looked at each area where there are transmitters and, in consultation with the broadcasters and any other affected body or organisation, allotted the number of channels suitable for operation of the power that we believed or that we all agreed was needed to achieve the same coverage to analogue. Once that is finalised you can then allot from those to the broadcasters. To effect a restack we will need to do a lot of new digital channel plans or vary the existing digital channel plans to move broadcasters out of bands that the government has decided are going to be the digital dividend and locate them in new configurations within the remaining band. That is a very significant engineering challenge that requires a concentration of engineering resources that we could not do with our present resources without simply defunding all our other engineering planning work. We do not believe that is an option. That is the background for the new policy proposal that we put up.

Senator BIRMINGHAM —Thank you for that. That was very good and useful, Mr Tanner. So that I am clear when you are talking about the engineering planning works in this regard, the engineering planning is undertaken by ACMA in going through and finding the appropriate piece of spectrum and signing the appropriate plan but then the broadcaster, I assume, is responsible for the work of reconfiguring whatever they have to do to broadcast?

Mr Tanner —That is correct. We are a little like the town planner, although in this case rather than just coming up with a broad plan and saying, ‘Here is an estate; you plan it,’ we are saying, ’No; we are going to design all the individual blocks and then we are going to allocate them to you.’ We have another instrument called the technical planning guidelines, which is a set of rules for broadcasters to follow in planning their own facilities. Those rules ensure that they do things like test for interference before they commence and that the signal they put out is within certain acceptable configurations that are not going to cause interference to other people or overload people’s aerials. There is an additional implementation frame which the broadcasters then go through once they have licences governed by subordinate legislation from ACMA, but the particular engineering task we are talking about here is very much the planning task—the town planning subdivision and allotment process.

Senator BIRMINGHAM —All of those sorts of testing mechanisms and the like are undertaken by ACMA to check that there is no interference in the first instance as part of the plan, and the costs of undertaking that testing is all within this planning and restacking allocation?

Mr Tanner —No. We do not use live tests when developing plans. We use desk modelling, propagation modelling software, which comes up with a pretty accurate, although sometimes conservative, simulation of how signals propagate. Those are the tools we use to make sure that channels can be used and can interoperate, and we use that to predict problems. Broadcasters then have a certain amount of latitude in how they implement a given technical specification, which is just an envelope. It is just a set of parameters they have to operate within from a particular nominated site. That is a separate engineering task which broadcasters would typically undertake involving live testing, and that, as I say, occurs subject to rules set out in ACMA’s technical planning guidelines.

Senator BIRMINGHAM —It still strikes me as incredibly expensive for the modelling and planning, but, Mr Tanner, you are convincing me that it is equally incredibly complicated.

Mr Tanner —I do not have the figures in front of me, but we have received money for a number of tasks. There is another major engineering and wider consultative and policy development task, which is the configuration of any dividend. That is a separate engineering and wider than engineering task, as we would design whatever spectrum allocations were going to be made and work them up for marketing by what was decided to be the appropriate way of marketing them. I am being fairly general because there are different issues with different parts of the digital dividend which will require different types of administrative approaches. We have received money for that half of the realisation of the dividend as well and we hope that as far as possible all these processes will occur in parallel and very intensively so that we do not get any significant delay after the dividend is yielded in putting the dividend to work.

Senator BIRMINGHAM —With the allocation of $4 million for the coming financial year, you are obviously hoping to be able to start work on this process fairly swiftly. Working backwards to meet the 2013 deadline that you are working towards, what sort of deadline for decision making from government do you have for the planning around the digital dividend?

Mr Tanner —I do not have a precise time, and there is a certain amount of leeway in which we can fully utilise the resources. We have to do a lot of important preparatory work that does not require certainty around the size of the dividend. There does come a point where it is most efficient for us to have the dividend to be able to do the job within that time frame, but I cannot tell you exactly what that is. We have a bit of leeway.

Senator BIRMINGHAM —It is some time this year, I assume, from the budget figures that are mapped out.

Mr Tanner —I would not necessarily accede to that without further thought and a bit more work.

Senator BIRMINGHAM —From the big picture to the little picture, I turn to television services and broadcasting licence areas. I have had some correspondence with the minister and some responses to a question on notice, which last time around was 175, for your reference. I have also received correspondence from the District Council of Kimba and others in regard to the boundaries for the Spencer Gulf TV1 licence area. I put the question on notice as to what would the communities of Kimba, Buckleboo and Karanda and those affected who believe they would like to see a redrawing of this licence area have to do to get a review undertaken of the licence area. I am not sure that I received a clear answer as to what they would have to do. I have some good background as to when reviews might be undertaken in general, but if a community is particularly dissatisfied with its position, what does it have to do to get a reconsideration of the boundaries of a broadcast licence area?

Mr Tanner —I apologise, Senator. We did attempt to answer this question on notice, and I expect it was a fairly detailed answer. A community or any member of the public or broadcaster is entitled to approach the ACMA at any stage and raise the issue whether or not a licence area is appropriate. What I believed our answer had communicated was that the problem with the community itself simply coming to us is that the ACMA, while it is the agency that determines and reviews licence area boundaries, does not compel broadcasters to provide extensions of their services to any given area. We would know we had an issue which needed to be addressed if we were aware that the broadcasters that the community is seeking to have in the area were willing to extend their service into that area. That would require a willingness to invest by them. ACMA would then have a proposition to consider where we had have some prospect that if we did agree something would change as a result. I think we also tried to give you a flavour of some of the issues that we expected would come up.

It is fairly certain that it would be opposed by the incumbent licensees that have stations in the area on the basis that they require a certain population to be able to claim the revenue they are able to claim from their advertisers, but those are issues we would look at. What I am coming to is that whereas anyone can ask us to look at a licence area plan boundary, there is not much point unless there are broadcasters of the desired service that are willing to come to the party and stump up the investment in a retransmission facility and in some way get the signal to that retransmission facility. I think at that point ACMA has a broad discretion to review the licence area plan.

Senator BIRMINGHAM —That is very clear, Mr Tanner. Thank you for that. It is quite useful. I am happy to go and talk to the broadcasters in that area and get them talking to the community to see whether we can put together some sort of proposal that could be put to ACMA because it is a strange looking map. It appears to have a bite taken out of the side of it. Most of the communities of the eastern and central parts of the Eyre Peninsula fall within the Spencer Gulf TV1 zone but there is this chunk of communities taken out of the side, for whatever historical reason I do not understand. It does not seem to make a lot of sense in terms of communities of interest or any other rationale that I can see from on the ground. But I am happy to go and talk to the broadcaster and see if we can achieve an application there.

In terms of timing, noting that broadcasters, of course, will have to invest in new facilities with the digital switchover—and for regional South Australia and the Spencer Gulf region in particular that will be in the second half of next calendar year—would it be possible to consider an application and to get such a review and such changes put in place that neither the existing broadcasters in the area nor the potential future broadcaster in that area were disadvantaged in the sense that their capital costs would have to be undertaken, to some extent anyway, as a result of the digital switchover?

Mr Tanner —I cannot answer that question on the spot because I am not sure what technical facilities are there. I do not know whether the communities have a local retransmission or whether they are served by satellite. If there is a local transmission, I assume it would be a self-help transmission because we are talking about, I think, the commercial broadcasters. I am not sure what the answer to your question is, but, in general, if an application or a request is made to vary a licence area plan, ACMA needs to go through wide public consultation. We would make that proportionate and targeted to the communities directly affected. It would need to go out with a proposal and consider any responses received in response. We do have a work program of licence area plan variations, and there would be issues about priorities, but if there were an opportunity there to do something, if there were an optimum occasion to do that in connection with digitisation, for example, I guess that is a factor we would have regard to in assigning a priority to any request.

Senator BIRMINGHAM —Thanks very much, Mr Tanner.

Senator MINCHIN —Just quickly on the budget item ‘Digital Television Switchover—regional South Australia, Victoria and Queensland’, I notice ACMA has been given $3.9 million over three years ‘to identify areas without access to digital television services and other technical switchover related projects’. There is nothing allocated in this area in the current financial year but you are undertaking those activities. Were you specifically funded for those, and is this a continuation of that funding or entirely new funding to supplement what you were otherwise doing out of your ordinary budget?

Mr Tanner —I think this is funding we have already received, $8.4 million, from memory, over four years. I think we are two years into that. This is ongoing funding we have received for our field survey and coverage work generally.

Senator MINCHIN —So this is not new money per se?

Mr Tanner —No. It is a decision that was made a couple of years back.

Senator MINCHIN —This $3.9 million is the residue of that but lumped in here with this measure and specifically highlighted. It reads as though it is new funding.

Mr Tanner —Which page are we looking at?

Senator MINCHIN —Budget Paper No. 2, page 117.

Ms Carlos —Senator, I might be able to clarify that. The $3.9 million is additional funding, but we were also provided with some previous funding a couple of financial years ago.

Senator MINCHIN —Yes, it is in a sense a continuation.

Ms Carlos —Yes, it is, Senator.

Senator Conroy —An increase from the sound of that description, Senator.

Senator MINCHIN —Yes. That is what I was going to ask. This is on top of funding you are already getting. Are you able to tell me what you will be expensing over the next three years on this activity, that is, evaluating digital transmission reception to assess whether digital TV, et cetera, is the same coverage?

Ms Carlos —I do not have those figures with me, Senator. I will have to take that on notice.

Senator MINCHIN —I am just trying to get a sense of the proportionality—what this increase amounts to—but you can come back to me on that.

Ms Carlos —I can come back. Could I also take the opportunity, Senator Birmingham, to correct the record in terms of the Gershon savings for the out years? They have not been factored into the forward estimates yet—the additional five per cent. The 2½ per cent has.

Senator BIRMINGHAM —Thank you.

Senator MINCHIN —Are you able to give us a brief indication of the testing program that this $3.9 million will cover? Is that sufficient? That is not of itself the amount that will be required for the testing in South Australia, Victoria and Queensland. This is augmentation to enable you to fully test in those three states, is it, in advance of switchover?

Ms Carlos —Mr Tanner could provide that.

Mr Tanner —Senator, my understanding is that, however it is expressed, the money for coverage work, including field testing, has not been increased from the four-year sum that we received. We have received some additional money, though, in connection with digital switchover. That money is for a range of things, including our power to make technical codes and standards, I understand. It is for research, which could very well be related to the field survey and coverage work that we do. It is to assist us with the costs of technical inquiries from the public about problems that the department’s hotline has been turning up with digitisation and a range of things like that. I am not aware that any of that money was simply to expand on the initial four-year somewhat more than $8 million that we received for the coverage and field survey work.

Senator MINCHIN —In the PBS it is here as a 2009-10 budget measure—$1.5 million, $1.5 million and $800,000 for the next three years for digital switchover, South Australia, Victoria and Queensland and described in the budget papers as part of a government overall provision of $138.7 million to this end, of which $3.9 million is for you to identify areas without access to digital television services.

Mr Chapman —Did I understand part of the Senator’s question being to give you a feel for the sort of work program that is involved?

Senator MINCHIN —I want to know whether that was new money on top of allocations you already had for the performance of that function. There seems to be some lack of clarity as whether it is new money or a restatement of money you were already allocated.

Mr Tanner —No, I think those figures of $1.5 million, whatever they were that you read out, are the additional—

Senator MINCHIN —121 in the PBS.

Mr Tanner —They are the additional funding.

Senator MINCHIN —So that is new money?

Mr Tanner —That large figure of well over $100 million in connection with the switchover is money largely for the department.

Senator MINCHIN —Yes, I know that. I was just finding out more.

Mr Tanner —That is work that we will be doing ancillary to the department’s work as part of digital switchover in those areas.

Senator MINCHIN —So this is new money to enhance your capacity—

Mr Tanner —That is new money.

Senator MINCHIN —to identify blackspots, basically?

Mr Tanner —No, it is for a broader range of purposes. We are already amply funded, in our view, for the program of field surveys that we think are appropriate. This is for, as I say, other ancillary tasks, such as, potentially, research, which may very well go to issues turned up in our field survey work or may be relevant to it. It is more broadly for research, for technical advice to people who telephone the hotline. It is for any work we do in connection with our power to register codes on technical issues or to make standards with regard to the performance of digital devices. That is my shorthand, from memory, of what the tasks are. These are other tasks ancillary to that switchover effort. My understanding is there was no additional funding for the coverage and field survey work for which we have already received some additional funding.

Senator MINCHIN —So the description in the budget papers themselves is a bit misleading. This is a funny line item. It has $1.5 million for each of the next two years, then $800,000 in 2011-12, and then it just stops. Switchover is not complete until 2013. There does seem to be some vagueness about what the hell it is for.

Ms Carlos —Senator, perhaps we can take on notice and provide to you the full funding that has been provided and this particular measure in terms of the total that has been itemised in budget papers as digital switchover.

Senator MINCHIN —I would appreciate that. On this research into blackspots, et cetera, we were advised back in February, I think it was, or in response to a question on notice that you were about to undertake research in the Mildura licence area and publish those results later this year. Has that research been undertaken, is it about to be published, and will it be published prior to any designation of the switchover?

Mr Tanner —The Mildura area has already been designated for switchover by a certain date. The research I think is currently taking place.

Senator MINCHIN —But you still have to push a button, I think. All you have done is indicate the date, but I think the minister reserves the authority to decide actually when, and, indeed, that is a disallowable instrument, as I recall.

Mr Tanner —I am sorry, Senator. David and I are at cross-purposes about exactly which research you are talking about. We have done extensive field survey work in Mildura. We will do more. Some flavour of that work and the results are reflected in the initial 5H report that the department published. One of ACMA’s contributions to that was an account of relevant findings of field survey work to date in Mildura, where we have done a very large number of surveys across a number of sites. We propose to do further field survey work in Mildura, but I should make the point that it is not so much that all the work is critical for us to perform before the switchover; it is that we are using Mildura very much as a pilot and as a test case. We are learning things and improving our methodology so that when we come to South Australia and markets beyond we will able to answer the questions we believe will be asked of us with a great deal of methodological confidence.

Senator MINCHIN —I do not think you want to leave the impression that the citizens of Mildura are guinea pigs, but I—

Senator Conroy —It is a pilot program.

Senator MINCHIN —Oh, it is a program, is it?

Senator BIRMINGHAM —That is a polite term for guinea pig!

Senator MINCHIN —Thank you for that. Do you have any more questions on that?

Senator BIRMINGHAM —I have one very quick one. In response to question on notice No. 174, listing a whole bunch of consultancies, I have a question about one: $44,000 for a consultancy undertaken between May and July last year by the organisation Strategic Media Solutions into current affairs programming. What are we looking at in current affairs programming?

Ms O’Loughlin —Senator, I think what we were looking at with that piece of research was community expectations of current affairs programs. As you know, when the industry decides to undertake a review of its codes of practice we often do research either on issues that have come to us via complaints or testing audience views and consumer views about particular issues. For example, we have previously done that on reality television. We are currently undertaking research into audience expectations of commercial radio. Similarly, as the commercial television industry prepares to review its code of practice, we undertook some research around current affairs programs, and that consultancy fed into that research.

Senator BIRMINGHAM —Thank you.

Senator MINCHIN —Just quickly, commercial radio has been approaching the government and the opposition on ‘trigger events’ in terms of local content.

Senator Conroy —One of your proudest pieces of legislation, I am sure, Senator Minchin.

Senator MINCHIN —Did you propose amendments to that, Senator Conroy, at the time?

Senator Conroy —No, I think you indicated you were going to propose some, and we indicated we would—

Senator MINCHIN —It is certainly the case, as is often the way of legislation, that—

Senator Conroy —You were the government at the time—

Senator MINCHIN —commercial radio—

Senator Conroy —mandating the number of people in radio newsrooms.

Senator MINCHIN —was concerned about the operation of this. I think the government should look at this. Are you as the regulator able to tell me how many licences have been affected by trigger events since this came into effect on, I think, 1 January last year?

Ms O’Loughlin —Senator, I do not have that detail with me. I would have to take that on notice.

Senator MINCHIN —I would appreciate you doing so. Can you inform me how many, having been notified, have failed to comply with the rules that you impose on them regarding local content?

Ms O’Loughlin —Senator, generally I think we are seeing reasonably high levels of industry compliance, but I am happy to take that on notice as well.

Senator MINCHIN —But you are as well aware as the minister and I are of the concerns about this with the industry?

Ms O’Loughlin —Absolutely.

Senator MINCHIN —Are you involved in any formal way?

Ms O’Loughlin —No, that would be a matter for the department and the minister.

Senator MINCHIN —Sure. That is all. Thank you.

CHAIR —Thank you. Are there any further questions for ACMA? If not, thank you very much to the officers of ACMA for appearing before the committee this evening. We will just have a short suspension while we decide what to do next.

Proceedings suspended from 10.22 pm to 10.25 pm

CHAIR —Thank you. Before all the officers move in, I would just like to make an announcement. The committee has decided to adjourn proceedings for this evening—you will be sorry to know—and will resume tomorrow at 9 am with program 1.2, followed by program 1.1, followed by program 1.3. Thank you.

Committee adjourned at 10.26 pm