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Taxpayer money used to displace private sector.



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Tue, 4th March 2008 TAXPAYER MONEY USED TO DISPLACE PRIVATE SECTOR

The Hon Bruce Billson MP Shadow Minister for Broadband, Communications and the Digital Economy

TAXPAYER MONEY USED TO DISPLACE PRIVATE SECTOR, COMMERCIALLY VIABLE INVESTMENT - NOT THE ACTIONS OF FISCAL CONSERVATIVES

A letter today from Telstra to the ASX provides disturbing confirmation that the Rudd Government is using $4.7 billion of taxpayers' money to displace private sector investment in commercially viable areas.

Communications Minister Stephen Conroy recently wrote to Telstra and other telcos demanding sensitive information about existing broadband network infrastructure, or face the threat of legislative intervention.

Senator Conroy claimed the confidential information was required ''to maximize competitive tension'' in the lead-up to a tender process for Labor's metro-centric, fibre-to-the-node network.

By contrast, what we have seen today is evidence that the government's determination to spend $4.7 billion of taxpayers money on its vague FTTN proposal, has deterred the private sector from making further investments until Labor sorts out its muddle.

In its letter to the ASX Telstra stated: ''In view of the FTTN process now commencing we will review current investment plans and it is likely that some investments will be put on hold until we know the outcome of the bid process.''

In Opposition Labor went to great pains repeating ad-nauseum that a Rudd Government would be fiscally conservative, but today's events provide further confirmation that it was all a charade.

Senator Conroy's 'show and tell letter' to the telcos was partially a tree shaking exercise by the Rudd Government, in a bid to gain some understanding about existing network capability, which has been clearly lacking, as Labor tries to find a way through its broadband mess.

But this exercise could prove extremely costly to taxpayers, with Labor's broadband confusion potentially halting major investment in commercially viable activities by the private sector.