House debates

Tuesday, 16 November 2010

Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2010

Consideration in Detail

5:39 pm

Photo of Malcolm TurnbullMalcolm Turnbull (Wentworth, Liberal Party, Shadow Minister for Communications and Broadband) Share this | Hansard source

by leave—I move opposition amendments (18) to (23), (25) to (32), (41), (42) and (44):

(18)  Schedule 1, item 30, page 11 (line 27), omit “writing”, substitute “legislative instrument”.

(19)  Schedule 1, item 30, page 12 (line 4), omit “written”, substitute “legislative”.

(20)  Schedule 1, item 30, page 13 (lines 17 and 18), omit “the associated provisions”, substitute “subsection 577BC(2)”.

(21)  Schedule 1, item 30, page 13 (line 24), omit “the associated provisions”, substitute “subsection 577BC(2)”.

(22)  Schedule 1, item 30, page 13 (lines 28 to 32), omit subparagraphs (22) and (23).

(23)  Schedule 1, item 30, page 14 (lines 3 to 5), omit the definition of associated provision.

(25)  Schedule 1, item 30, page 15 (line 7), omit “writing”, substitute “legislative instrument”.

(26)  Schedule 1, item 30, page 15 (line 13), omit “writing”, substitute “legislative instrument”.

(27)  Schedule 1, item 30, page 16 (lines 7 to 12), omit subsections (9) and (10) including the subsection headings.

(281)       Schedule 1, item 30, page 18 (line 9), omit “writing”, substitute “legislative instrument”.

(29)  Schedule 1, item 30, page 18 (lines 14 to 16), omit subsections (8) and (9).

(30)  Schedule 1, item 30, page 18 (line 17) to page 25 (line 5), omit section 577BA.

(31)  Schedule 1, item 30, page 25 (line 8), omit “writing”, substitute “legislative instrument”.

(32)  Schedule 1, item 30, page 25 (lines 22 to 27), omit subsections (3) and (4) including the subsection headings.

(41)  Schedule 1, item 31, page 59 (line 9), omit “make a written”, substitute “, by legislative instrument, make a”.

(42)  Schedule 1, item 31, page 63 (line 18), omit subsection (6).

(44)  Schedule 1, item 33, page 75 (line 34) to page 76 (line 5), omit the item.

These are the amendments referred to on the amendment sheet under the headings ‘disallowance of instruments’ and ‘competition’.

I will deal briefly with the matter of the disallowance of instruments. In section 577A of the bill, there is a new provision relating to the manner in which an undertaking from Telstra to effect a structural separation may be accepted. Such an undertaking would, under this provision, have to be considered by the ACCC, although not under the purview of section 51—so it would not be considered by the ACCC for the purpose of determining whether or not it was anticompetitive. This, of course, begs the question as to why the ACCC would be involved. But, putting that aside, the ACCC is asked, under this provision, to take into account certain matters which may be specified to it by the minister in writing. The purpose of the amendments referred to on the amendment sheet as ‘disallowance of instruments’ is to replace ‘in writing’ with the words ‘in a legislative instrument’ and this happens at a number of places through the bill.

This is simply a question of accountability. The amendments would ensure that any ministerial direction to the ACCC regarding the criteria for acceptance of a functional separation—or indeed a structural separation, because the provisions also apply to the section in the bill dealing with that—would be a disallowable instrument and therefore subject to the scrutiny of parliament.

The second set of amendments that we are considering in this group are those referred to on the amendment sheet as relating to competition. This is probably the most important part of this group of amendments. These amendments are designed to ensure that the normal operation of the Competition and Consumer Act, formerly the Trade Practices Act—the key legislation in this country protecting the interests of consumers and promoting competition—would apply to the deal involving Telstra and NBN Co. The amendments would, among other changes, excise new section 577BA. New section 577BA is at page 18 of the bill and basically provides that a contract between the NBN Co. and Telstra would, by virtue of this statute, be authorised for the purposes of section 51 of the Competition and Consumer Act. In other words, without our amendments, that contract between NBN and Telstra would not be considered by the ACCC. Why is the government seeking to do that? It seems extraordinary that a government that has talked so much about the importance of competition in telecommunications would actually legislate to take its own new monopoly out of the purview of the ACCC.

Why are they doing that? They are doing that because a key part of this deal is an obligation on Telstra, as I said earlier in this debate, not to use its HFC cable to compete with the NBN. It is a key part of the deal because the government knows, and NBN Co. knows, that if they allow facilities based competition it will result in lower prices and better deals for internet users. That, of course, would undermine the already tragic economics of the NBN.

The minister compared this earlier to a rail track and said, ‘If you have competition for use of the rail track, you don’t need to have two rail tracks.’ The fact of the matter is that if you have a monopoly provider of any service, be it wholesale or retail, that monopolist will seek to attract a monopoly rent. That is why we are opposed to monopolies; that is why we have legislation to regulate monopolies; that is why we have the elaborate provisions of the Competition and Consumer Act. But, without our amendments, those provisions would now be irrelevant to this anticompetitive transaction, the consequence of which can only be—you cannot suspend the laws of economics—higher prices, less affordability and less accessibility to the internet for Australians. (Time expired)

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