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There's more to Telstra than profits.

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Shadow Minister for Communications, Lindsay Tanner, today called on Australians not to focus on profits alone when judging Telstra’s interim results today.

“Whilst it is important that Telstra maintains healthy profits this must not detract from Telstra’s obligations to provide adequate and reasonably priced telecommunications services to all Australians.

“Telstra isn’t just about profits, it’s also a majority publicly owned company with community service obligations.

“The Howard Government is primarily concerned to bolster its proceeds from the further sale of Telstra that it has projected to begin in 2003. Telstra’s current share price is significantly below the amount factored into the Budget and this is putting further pressure on the Government’s shaky long-term fiscal position.

“The Howard Government doesn’t care about Telstra’s service levels because it knows that improving service levels requires increasing capital expenditure. Telstra has been decreasing capital expenditure, and service problems are still widespread in rural Australia.

“The latest Australian Communications Authority report on telecommunications performance levels showed continuing problems with Telstra fault rectification in remote areas, a serious decline in the number of Telstra operated payphones and a massive decline in the number of directory assistance calls.

“Telstra has embarked on a range of measures designed to prop up the company’s short-term results and bolster immediate profits. These include widespread price rises in the consumer mobile phone and Internet divisions, the cancellation of the community email service, Easymail and further staff reductions and outsourcing. These changes are partly motivated by a need to compensate for losses incurred by Telstra on risky foreign ventures.

“It is only through investment in Telstra’s core telecommunications services that service levels will improve. Telstra needs to get back to basics and concentrate on providing all Australians, in the cities and the regions, with an affordable and reliable modern telecommunications service”, Mr Tanner said.

March 6, 2002

For further information contact Lindsay Tanner or Peter van Vliet on 0408 188 055