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Backdown Barnaby now rubble: Telstra sale more slush than substance for the bush.

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Media Release

Kelvin Thomson MP Shadow Minister for Public Accountability; Shadow Minister for Human Services Federal Member for Wills

17 August 2005

Backdown Barnaby now rubble: Telstra sale more slush than substance for the bush

It was revealed in the House of Representatives this afternoon that much of the funding distributed as part of the T1 and T2 Telstra sales was wasted.

As the out-of-touch Howard Government prepares to sell the rest of Telstra in the face of massive community opposition, what do we have to show for the $3 billion distributed under the Regional Telecommunications Infrastructure Fund?

Very little of it actually resulted in regional telecommunications infrastructure. Instead, the Howard Government handed out large numbers of grants to groups in regional Australia for services rather than infrastructure. Many of the groups had little expertise or track record. Most were unable to establish viable projects. The opportunity to build regional infrastructure was blown away with a host of grants that had more to do with National Party pork barrelling and have offered little lasting value to regional Australia.

Of 130 taxpayer grants to NSW rural projects after the first Telstra sale, one in four of the grants did not add a single telephone or internet service to the bush. 27% of the grants funded studies, strategies, needs assessments and training programs.

More than $95 million of the telecommunications funding promised to the bush was later withdrawn by the Government and counted as savings or spent on other projects.

An audit report into the programs was highly critical of the lack of accountability imposed on those who received the grants. It found that administration costs soaked up 26.9 per cent of one program to set up 500 rural transaction centres.

Labor has revealed that two key Networking the Nation projects in Northern NSW have fallen over. Norlink, recipients of $1.7 million went into receivership on 26 May 2005. Key stakeholders have distanced themselves from Bangalow businessman Christopher Sanderson's Australian Freshfood Trading Company which received an $894,000 grant.

The $6 million “Working to Keep the Country Connected” Advertising campaign was rolled out prior to the last Federal election and yet only generated 971 calls to its Telinfo helpline - on average only 40 people per day or just two people per hour - at the height of the

campaign. The “Your Phone Service, Your Rights” booklet which then Attorney General Daryl Williams’ described as the “key element” of the campaign is no longer available online.

So much for keeping the country connected. Or working.

The Howard Government has been incompetent when it comes to building regional telecommunications infrastructure. Backdown Barnaby is now just rubble. The National Party is slowly shrinking away, and their complicity in the sale of Telstra will do them in, just as surely as the GST finished the Democrats.

/Ends Canberra 17/08/2005

Contact: Cora Trevarthen 0418/770484