Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I rise to make some further remarks on the Interim report of the Senate Select Committee on the National Broadband Network. This report is an indictment of the NBN strategic review. When announcing the strategic review, the minister said: 'I just want the plain unvarnished facts. We do not want spin. We do not want the company to tell us what they think we might want to hear.' I regret to inform the Senate that that this is exactly what has happened.

The report confirms that the NBN strategic review was undertaken by personnel and advisers hand-picked by the minister with no independent scrutiny or verification of its final report. This stands in stark contrast to the 2013 NBN Co corporate plan, which was based on signed contracts and independently audited by KPMG and Ernst & Young. The minister has been told exactly what he wanted to hear. This is no way to spend $40 billion of taxpayers' money and it is no way to plan a broadband network for all Australians.

This minister's patchwork quilt of broadband technologies will be a financial disaster. Let us have a look at the strategic review. It either ignores or fudges when it comes to the favoured MTM model. The strategic review contains no field data to support the MTM model. It relies on nothing more than international benchmarks and estimates. The committee report finds that the strategic review significantly underestimates the costs of the MTM compared to a new fibre build. It underestimates the costs of having to operate two extra fixed-line networks. It underestimates the costs of having to maintain last century's copper technology. It underestimates the costs of migration processes, of IT systems, of running voice services over a network that NBN Co does not own. Across this mess of a broadband plan, the costs are always at every single opportunity underestimated.

What happens when it comes to the revenues? The committee found that the strategic review overestimates the revenues possible on the MTM compared to fibre. That is right, Acting Deputy President Furner: the strategic review underestimates the costs and then overestimates the revenues. NBN Co's caretaker advice to government made it clear that the minister's plans would not be able to generate the revenues that Labor's NBN would generate. FTTN is an inferior broadband technology. It cannot deliver the same products that fibre can. The same is true of HFC networks—no gigabit services in these footprints; no dedicated information rates; an inferior multitask product; no products that Australians can easily migrate to when they need better quality broadband; and, most outrageously given the promises, best efforts when it comes to download speeds.

Mr Turnbull made great claims that he would guarantee delivery of 25 meg down. What did the chair of his company say in a Senate estimates hearing? 'I cannot give any such guarantee.' What did the new CEO say of NBN Co when asked to guarantee Mr Turnbull's promise? 'I would not put my signature to that.'

What we have here is a fraud on the Australian public—an absolute fraud. It is $40 billion. Those opposite, who sit there chuckling right now, are going to spend $40 billion on a network that you cannot guarantee a download or an upload speed for.

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

You hypocrite! You arrogant hypocrite!

Mark Furner (Queensland, Australian Labor Party) Share this | Link to this | Hansard source

Order! There will be order in this chamber!

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

$40 billion to deliver something that cannot guarantee the speed down or a speed up. What a bunch of geniuses! And just for good measure they are the only company, and this is the only country in the world, that are trying to buy a copper network. Do you know what most companies around the world are doing with their copper network? They are selling it because it is worth more for the scrap value than the technology value. There are companies out there buying telcos' copper networks to rip them out off the ground and sell them on the spot market. But no, not in this country. In this country we are going to buy the network and we are going to keep using it. Unbelievable. What a disgraceful waste of taxpayer dollars.

What we saw in the last election campaign was those opposite saying that this was about trust. All promises and guarantees before the election, but after the election no guarantee from anybody who actually understands the technology—no guarantee. And, most importantly, the MTM delivers inferior upload speeds that will disadvantage the millions of small businesses in Australia. That is right: they are going to spend $40 billion to disadvantage small businesses, particularly in regional and rural Australia. But despite all of this, the strategic review somehow assumes that the MTM will generate a similar revenue to an all-fibre rollout. They cannot deliver the top-end products and they cannot deliver the upload speeds that small businesses need, but they can make the same money! Absolute geniuses!

What is of particular concern to those of us on this side of the chamber is that the coalition's plans—and this is another pernicious attack on ordinary Australians—state that they want to see Labor's fibre-to-the-home broadband rolled out in 'high-value suburbs'. So if you are rich enough to be able to spend a bit of money on broadband you get the best network. But if you are in the not-so-high-value suburbs you get the second-rate Mr Malcolm Turnbull network. The second-rate network; that is what Mr Turnbull is condemning the Australian public to.

Effectively, it means that people with more money will access the best broadband network in the world and people with less money will have to make do with an inferior broadband network. This is a betrayal in the 21st century of the most vital piece of infrastructure we need into the future. But Mr Turnbull has put forward his multi-technology mess as some kind of antidote to what he describes, in that other place, as 'Conrovianism'. Labor's fibre-to-the-home NBN—Conrovianism. It is a disease he talked about in the other place.

Well, the big and exciting news for Mr Turnbull is that the world's best broadband technology is being adopted around the world: in New Zealand, in Singapore, in China, in Japan, in Korea, in Spain, in France and in Indonesia—yes, in Indonesia as well. Mr Turnbull claims he knows more about this than the guys at Google. Well, I know who I am putting my money on. Google is building fibre-to-the-home networks in Kansas City, Provo and Austin, and is planning to expand to other cities across the United States. But, unfortunately, Conrovianism seems to be approaching pandemic levels around the world, because all those countries are building fibre networks. Not one of them is buying a copper network off an incumbent telco—not one of them.

I want to be very clear about this: Labor decided to have fibre to the home because the advice of the experts told us that fibre to the node was not a cost-effective path. The strategic review actually reveals that a committed and active management can deliver—this is in Mr Turnbull's own document—a fibre-to-the-home network on the basis of the last considered corporate plan, 2013-16. The strategic review has not made the case for a two-stage build as proposed by the coalition.

The committee's interim report recommends that NBN Co management be unshackled to continue rolling out fibre to the premises free from Mr Turnbull's political interference. I recommend the report to the senators, and I am sure I will be revisiting this issue.