Tuesday, 16 November 2010
Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2010
Consideration in Detail
The Minister for Infrastructure and Transport has just told the House that the undertaking about structural separation will be considered by the ACCC. That is true. I mentioned that earlier. But the ACCC will not be considering that undertaking in the context of competition. The only reference to competition is the requirement, in proposed section 577A(3)(a), that the undertaking provides for equivalence in relation to the supply of Telstra to its customers. What that means is that the ACCC simply has to be satisfied that the NBN will charge like customers like amounts. It does not raise or consider the problem that the NBN is a monopoly, part of a deal which excludes competition from other facilities, such as the HFC network and, no doubt, other telcos that will be asked to do a similar deal with the NBN. It does not consider the monopolistic consequences of that; namely that, while the NBN may be charging equivalent prices to its customers, those prices will be excessively high. If they are overcharging everybody, that will pass the test. So this really misses the point. This authorisation is no substitute for the competition provisions of the Trade Practices Act.
Next is the issue about accountability. I wonder how the Independent members feel about the new paradigm. The minister sounded like he was back in the old days, when he had a big, solid working majority here. He said that the risk of disallowance—that is, the risk that either house could disagree with the government—would create uncertainty and involve ‘playing politics’, to which the honourable minister is a complete stranger! The government have entered into a massive, unprecedented commitment to build an uncosted, unanalysed National Broadband Network. They have then entered into an anticompetitive contract with Telstra. Having done both of those things, they then say that those agreements and those investments that they are proposing to make are the sole object of policy, and any scrutiny, any check, any balance—anything which prevents the government getting its way—creates uncertainty. I thought that in the new paradigm we were all in favour of accountability.
The fundamental point—and this is a matter that this House has to reflect on very seriously—is that what we have is the creation of a massive government owned telecoms monopoly. We have a government that is seeking to use the power of the parliament to ensure that that monopoly has nobody competing with it. Therefore, it will be able to charge higher prices—indeed, the McKinsey implementation study proposed that price increases in real terms be imposed on customers every year for the next decade. That is a complete reversal of the experience that we have had.
When did we decide that the competition laws of this country, which we all regard as being so important to microeconomic reform to an efficient modern economy, should not apply to the biggest monopoly in one of our most important sectors? This is unprecedented. It is extraordinary. It is reprehensible that the government is creating this massive monopoly and excluding competition with a combination of threats, guns at heads, legislative power and $11 billion, and then, just in case this might offend the competition laws of the country, providing by statute that those laws do not apply.