House debates

Thursday, 22 October 2009

Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2009

Second Reading

1:03 pm

Photo of Rowan RamseyRowan Ramsey (Grey, Liberal Party) Share this | Hansard source

I rise on the Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2009 to support the amendment moved by the member for Dunkley. It was only a few weeks ago that I rose in this place to speak on the National Broadband Network information measures and I took the opportunity to point out many of the difficulties that the government had brought upon itself in its haste to try to meet some electoral commitments that it had probably blurted out unintentionally. I took the opportunity at the time to point out how the government had announced, first of all, the $4.7 billion package with 98 per cent of Australia to receive fibre to the node, how it had announced that policy without really understanding what it meant and the possibility of getting private partners to join with it. I also pointed out how then the government had jumped into the $43 billion version with, once again, no business plan and not truly understanding the implications of what it had been saying. I highlighted the fact that it did not have any financial plan, any business plan, for the implementation of either of these policies. I also took the opportunity to point out the incredibly low uptakes of expensive high-speed broadband around the world and, in particular, pointing to the uptake in Finland of 1½ per cent and Singapore of one per cent—which I will probably come back to later. I particularly took the opportunity to point out how regional and rural Australia was being ripped off and now was going to be totally left behind on the deal.

So what has changed? As I predicted at that time, another collapse of process; and now another enormous shift of policy, an untelegraphed shift of policy, by the government as it recognised it had no chance, once again, of delivering on its grand commitments. This enormous shift in policy is nothing less than a nationalisation of a private Australian company—in this case Telstra. It is probably not something that I expected to see in my lifetime and certainly not something that we should leap into without due consideration. The moves by the government to force Telstra to separate their business will effectively force that part of the business into an unavoidable sale, takeover or merger with the only probable investor in the broadband upgrade being the government. The government is the only probable partner, given that it has signalled that it is prepared to throw $43 billion of taxpayers’ money at the deal and that it could not possibly be supplanted by any other partner.

Having Telstra as the only possible customer is likely to mean that Telstra shareholders will get a haircut or that taxpayers will own a network that will result in losses for Telstra shareholders. The alternative is that taxpayers may well be left with an asset—which the government has committed to sell five years after completion—that may not be worth all that much. The government has moved so far on this policy since the last election, since we heard the commitment to build the fibre-to-the-node network for 98 per cent of Australia, commencing before the end of 2008 and using what now seems like a very small amount of public money, given the way this government has run up debts. That ‘very small’ amount of money—and I put that in inverted commas—was $4.7 billion of taxpayers’ funds.

So what is the argument that the government should own the distribution network for telecommunications, that we should legislate to form a government monopoly in an industry? Imagine if anyone were to propose the same for the mobile network—the most dynamic, competitive and fastest growing of all forms of communication. What would the public say if we were to propose to get rid of the competitive nature of that market that has driven innovation and choice? The mobile sector was once dominated by Telstra, but it no longer even has the biggest share. The flexibility in that market has led to a sector where access has continually increased and the price of services has continued to fall. It is a sector where individual operators continually introduce new technologies. Imagine what it would mean for other businesses who have vertically integrated business models if they were to be pulled apart by the government. Imagine the loss of value, the loss of confidence in Australia’s business models if the government were to take this attitude across other industries. While many of us are not always happy with the power of some of our large industries, the reason they are so successful is that they do have integrated business models which provide special advantages in the market.

There are myriad complications inherent in this legislation that could not possibly be explored in the time frame. The minister only flagged these moves a month ago, then tabled the legislation and here we are, being expected to vote before the government’s own implementation committee—which has cost $25 million—has reported. We have little justification, once again, to bring it all under government control and make the government the regulator, owner and operator of the nation’s telecommunications network.

There were a couple of underlying reasons for the sell-off of Telstra. One was because the monopoly government corporation, as it was then, was unresponsive, lead-footed, lacked innovation and provided expensive services which were getting more expensive. Another reason for the sell-off of Telstra was the enormous debt Australia found itself in as a parting gift of the then Labor government. It seems remarkable that at a time when, as a nation, we will soon owe more than $200 billion we would be contemplating borrowing another $43 billion to build this new network.

So how did we get to this point? It all started during the last election campaign, when the then Leader of the Opposition, Mr Rudd, was selling himself as ‘John Howard lite’. Nothing much would change; remember that? The attitude was: ‘Tax policy; we’ll copy that. It’s about right. Economic settings; they’re good. Immigration policy’—that is a moot point at the moment—‘We will do that about the same.’ We all remember it well. We certainly had different policies on industrial relations. Mr Rudd was looking for some big ideas, some broadbrush—


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