Don Randall (Canning, Liberal Party, Shadow Parliamentary Secretary for Local Government) Share this | Link to this | Hansard source

I am pleased to speak on the Telecommunications Universal Service Management Agency Bill 2011 and cognate bills because it gives me an opportunity to talk about some of the service obligations of the telecommunications industry on behalf of the government and to point out where this is not the case, particularly in my electorate. The universal service obligation is a vital aspect of Australian telecommunications because every Australian needs and deserves access to basic telephone services at a reasonable price. The USO guarantees these services should always be available. People in the bush as well as people in cities and people in outer metropolitan areas deserve access to basic telephony and, increasingly, internet access.

This legislation comes in three parts and will create a new statutory agency called the Telecommunications Universal Service Management Agency, or TUSMA. This agency will be responsible for entering into contracts on behalf of the Commonwealth. Most people have spoken about the detail of this bill, so I do not intend to. But I will say that the legislation provides for a review of the USO arrangement before 1 January 2018 to basically see how it is going and to talk about the way it has been funded. Some of the issues are that the government has agreed to pay Telstra $230 million a year to provide standard telephone services and $40 million a year for payphones, and Telstra will be paid $20 million a year for emergency call services. And then there are administration costs et cetera. The final bill before the House is the Telecommunications (Industry Levy) Bill 2011, which is a procedural mechanism that will essentially demonstrate how TUSMA will be paid for.

The universal service obligation is something that both sides of this House have agreed to. In my time here as a member of the Howard government, telecommunications was something that we certainly made sure the bush had access to, particularly in the case of remote areas of Australia. It was largely done in an expensive fashion by satellite. The coalition continues to be committed to ensuring that Australians in regional areas will continue to have reliable access to standard telephone services. And, speaking of rural Australia, dare I say at this point that I was so surprised to hear in question time the Minister for Regional Australia, Regional Development and Local Government, the Hon. Simon Crean, banging on about this, when in Perth he promised to commit to funding for the RDAs in a regional area and the money still has not come. Here we are in the new year, the RDAs are still trying to survive and the minister has not coughed up the funding, so how can we believe him on an issue like this?

TUSMA, as I said, is going to be the delivery mechanism. It will be interesting, because it will involve a change from recovering the costs from the industry to being substantially funded by the government, with the balance funded by industry. One suspects that the amount of funding the government will provide either will be reduced or will not be increased in line with inflation or need. Increasingly, the industry will have to come up with the money through levies—and of course the industry will retrieve that money by passing the cost on to the customers. My electorate of Canning is very interesting because it is part of the Perth metropolitan area, it is outer metropolitan, it is rural and it goes deep into beachside areas in the south, before Bunbury. So we have a whole range of telephone needs. Again today the government came out with a promise, like it did before the last election, about delivery. Before the 2007 election, the then Leader of the Opposition, Kevin Rudd, and shadow minister Conroy said that they would deliver this telephony to everyone in Australia. Then they said it would only be delivered to 94 per cent of Australians, and then it would only go to towns with over 1,000 people. I have a heap of towns in my electorate that do not have 1,000 people—for example, Jarrahdale, Mundijong and Serpentine miss out on this. I am writing to them to tell them that they are going to miss out on any future NBN rollout, because that is what has already been put out there. They deserve better.

We have to understand why we are in this position with the NBN and how this obligation is going to be served. In the current stand-off between Telstra, which has been the universal provider, and the NBN rollout, there are people who cannot get any access to telephony or any internet at all in parts of my electorate. Dare I say that there are people just behind my electorate office in Kelmscott who are still on dial-up. That is meant to be a metropolitan area. Can you believe that they are still on dial-up in this so-called modern age?

Do you remember the then opposition leader, Kevin Rudd, standing there with his computer saying: 'This is the new toolbox of the future. This is what you are all going to be using in the future'? He was going to give all these laptops to schools, but they needed to be connected. Dare I say, the deal was not even done. They said they would do it in the first 12 months of government. In the first 12 months of government they did not get anywhere near delivering any such deal. It took towards the end of the Rudd-Gillard first term to even come up with a contract for the rollout of any broader service to the electorate. Why did they then decide to produce a mechanism called the NBN, which is largely a nationalised telecommunications product?

Unbelievably, my state of Western Australia is being threatened by Prime Minister Gillard for not following through with competition policy and not providing enough competition in a whole range of areas, yet here we are with the Commonwealth government re-nationalising telecommunications in this country. We are going back to the old days of the PMG, where the PMG was the sole provider and there was no competition. In fact, we know that recently the NBN Co. tried to stop Telstra from competing with them in wireless and this had to be adjudicated. It was adjudicated in favour of Telstra to say that they could compete with the wireless technology. Why wouldn't they? It is a very successful technology. It is a technology that the Americans decided they would use rather than put all their eggs in one basket, which the NBN is doing.

Can you seriously believe that this government would put what most commentators suggest will end up at $50 billion of borrowed money into one technology of fibre to the home—not fibre to the node, where it can be taken out and reticulated into the suburbs, into the businesses and the schools in the area. Fibre to the home is the most expensive one-shot-in-the-locker option of providing telecommunications. Before the 2007 election, we had in place a very good wireless technology which had been quite well appreciated by many in the industry called OPEL, which was a wireless opportunity for outer metropolitan areas where sending it up and down the streets in cavities was not an option due to topography, due to the sort of land they were crossing et cetera. But, no, we ended up with the expensive NBN option. One of the first places it is supposed to be rolling out in in Western Australia is Halls Head. There is no sign of it yet. The people had a public meeting not so long ago and asked me to come along. They said, 'Is it true that I have telephone cables running past my house now and that they are going to become redundant and that I will have to sign on to what is taken past by the NBN and pay more money?' That is the fact of the matter.

Unbelievably, the NBN, on behalf of the government, is buying the copper wire network from Telstra. Copper wire is not the technology of the future. We know that. It delivered into Australia and it has done a reasonably good job in some areas. But why would you trash it before you have a replacement? That is my point. Parts of my electorate—for example, Piara Waters and Harrisdale—cannot get enough ports out of their exchange now. I have emails here from people in my electorate begging me about this. Mr Grant Hill from Harrisdale says that they deserve better. He is trying to run a business from his home and he cannot get enough ports in the area. Thank goodness, at least I can still ring David Thodey from Telstra and say, 'Can you help us here?' and generally he does. Generally he does put more ports in the area. But now there is a huge waiting list. Telstra are saying, quite rightly, 'Why would we go and invest in infrastructure in an area when NBN are going to come and make us redundant some time later?' By the way, Grant Hill is putting out a petition in the area seeking support from all those in this new suburb saying, 'We need help because we cannot connect.' As you know, much of it is through wireless towers, telephone towers et cetera. Now you can get BlackBerrys and do business on those. So we have got a petition going

Today I had an email from Martin Reddan and Laurie Doncon saying that it is that slow there that when they try and connect they have to wait until late at night or until certain hours on the weekend before they can do any business.

I want to now put something on the record, because I believe that some time in the future this prediction will come back to haunt those in this House. Telstra are waiting on a very fascinating end game. They are going to be paid $11 billion by the federal government through the NBN for their redundant copper wire network. They are going to build all this extra infrastructure. Then—because they can, because the ACCC stopped them being knocked off by the NBN—they are going to provide wireless technology with very good upload and download capacity to people right across Australia at less than the NBN are going to charge them. They are going to blow this technology out of the water. They will usurp the NBN sometime in the future and it will take a future coalition government to bail out the NBN because nobody wants to sign on to it.

We have seen this in Tasmania. The NBN has been rolled out in areas of Tasmania. I asked the member for Gilmore and she said that not that many people have taken it up in her electorate since it was rolled out. Where has it been rolled out first? In areas like Lyne and New England. Why? So that they are going to vote for it and get it over the line. That is the 30 pieces of silver to help get this over the line. Yet people are voting with their feet, not paying for it and not taking it up.

I say to the House tonight that the universal service obligation means rolling it out and giving people access when they need it. Parts of my electorate do not look like getting any of this technology any time soon. So what are they doing? They cannot afford satellite, because they are in the so-called metropolitan area. Wireless is not available to them unless Telstra provides it to them. And the NBN could be 10 years or more away. What are they going to do in these new homes and these new estates?

We have a better way. We are going to do something to stop the mess, whether given the opportunity in three months or 18 months. We are going to put some sanity back into telecommunications in Australia, rather than have a big, expensive, borrowed money deal that will do nothing for many of the people in our electorates at the moment. I say to the government that this has been a nose in the trough exercise, with the money simply being shovelled out. There has been no cost-benefit analysis. There has been no research into whether it will be of any use to people in certain areas. As I said, this one technology puts all the eggs in one basket. That is something that this government will come to rue at a later time, because as a result they are going to be usurped by modern technologies that we know continue to be made available on an annual basis. This will be something that we will look back in shame on. Our kids will say to us, 'How did you ever let 'em get this expensive option that does not deliver for all of Australia through the place?' I will say that I did my best and that I exposed them in the parliament as being profligate with taxpayers' money.

Anthony Albanese (Grayndler, Australian Labor Party, Leader of the House) Share this | Link to this | Hansard source

This debate has been on a package of three bills, the Telecommunications Universal Service Management Agency Bill 2011, the Telecommunications Legislation Amendment (Universal Service Reform) Bill 2011 and the Telecommunications (Industry Levy) Bill 2011. This package will provide a flexible, accountable and transparent model for delivering and funding public policy objectives in the telecommunications sector. The reforms contained in the bills being considered are aimed at ensuring continuity of key consumer safeguards through the transition to the National Broadband Network and into the future. These include ensuring reasonable access to standard telephone services and payphones, the National Relay Service and the emergency call service. The bills address important unfinished business dating back to the privatisation of Telstra. They provide for increased transparency and rigour in the delivery of basic consumer safeguards. Under this approach, the realistic costs of delivering these important services will be appropriately recognised.

The Telecommunications Universal Service Management Agency Bill 2011 will establish a new entity to support continuity of key telecommunications safeguards in the transition to the National Broadband Network. TUSMA will be a small statutory agency with responsibility for the delivery of the universal service obligation and other public interest telecommunications services. Members opposite have suggested that TUSMA will employ an army of bureaucrats. This is clearly absurd, given that TUSMA's administrative costs are expected to be around $5 million per annum.

TUSMA will enter into and administer contracts and grants for these services in accordance with the policy objectives set out in the TUSMA Bill. The creation of TUSMA is necessary because the rollout of the wholesale-only National Broadband Network will fundamentally change the structure of the Australian telecommunications market. These changes will see Telstra's near ubiquitous national copper fixed-line network progressively decommissioned as NBN Co. rolls out its next generation fibre network. The current USO regulatory arrangements that are imposed on Telstra were designed for a market in which there was a vertically integrated operator of a national telecommunications network. The new NBN environment will enable all retail service providers to offer high-quality broadband services nationally. Therefore, in this environment, it is appropriate to introduce a more competitive and open model for delivering universal service and other public policy telecommunications outcomes. These new arrangements will benefit both consumers and industry by promoting more innovative, effective and efficient service delivery arrangements.

TUSMA will be subject to rigorous transparency and accountability requirements. This will help ensure that the costs to industry do not increase unnecessarily. The agreement with Telstra includes a range of incentives to promote cost savings. Further, a structured program of reviews provides opportunities for voice and payphone services to be provided more efficiently. In relation to concerns that TUSMA's scope should not increase unnecessarily, the legislation provides some flexibility so that the services that it delivers can be modified as circumstances change. However, any proposed changes would be subject to clear parliamentary oversight and scrutiny.

The Telecommunications Legislation Amendment (Universal Service Reform) Bill 2011 amends the universal service regime in the Telecommunications (Consumer Protection and Service Standards) Act 1999. The amendments mean that within two years of the commencement of TUSMA operations the minister must consider whether it is appropriate to remove the current regulated USO on Telstra to make the standard telephone service and payphones reasonably accessible. Subject to Telstra's record of compliance with its contractual and regulatory obligations, the minister may then make declarations that will commence the process for lifting regulation and shifting to a contractual model for the provision of universal service outcomes. This process will be overseen by TUSMA.

The Telecommunications (Industry Levy) Bill 2011 provides for the imposition of a new levy. This levy will replace two separate existing industry levies and will contribute to meeting TUSMA's costs for delivery of the USO and other public policy telecommunications outcomes. For the first time government will also be making a substantial contribution towards TUSMA's costs and the delivery of key communications public interest safeguards.

The government's budget contribution will be at least $50 million in 2012-13 and 2013-14 and then $100 million each financial year thereafter. The government has also committed to increase its base funding in the first two financial years so the contributors to the industry levy, with the exception of Telstra, will not face an increase to their aggregate funding contribution. Furthermore, the government has also committed to review the levy arrangements and the need for any additional budget funding above its committed base funding during the course of the first two years of TUSMA's operation.

The TUSMA Bill creates a rigorous oversight and accountability framework. The new legislation will provide for TUSMA to have a board structure and require the minister to ensure that TUSMA includes members who have substantial experience in or knowledge of and significant standing in the operation of the telecommunications industry and business or financial management. These members will be expected to take a strong role in managing the costs of TUSMA activities. TUSMA will also maintain publicly available registers of the contracts and grants it administers and report annually to the minister on all significant matters relating to the performance of contractors and grant recipients; prepare a corporate plan every three years, as well as a comprehensive annual report; provide reports or information to the minister on specified matters relating to the performance of TUSMA's functions and undergo a comprehensive review before 1 July 2018. This accountability framework, together with the existing reporting requirements for statutory agencies under the FMA Act, will help give stakeholders the confidence that TUSMA will use its funding to fulfil its functions and policy objectives in an efficient, effective and appropriate manner.

Those opposite argue that the government did not follow due process in addressing its contract with Telstra for the delivery of the USO and other public interest services. However, Telstra is the primary universal service provider under legislation and is the only telecommunications provider with a national, ubiquitous, fixed line network which can be used to ensure the continuity of key telecommunications services during the transition to the National Broadband Network. I would also note that there have been contestability arrangements under the USO since 2001 but no alternative providers have sought to supply services under these arrangements to date—more than a decade ago.

People who are currently receiving key services need certainty that their services will not be disrupted, possibly for a long time, while a new USO provider rolls out a network or finalises negotiation for access to infrastructure. TUSMA's 20-year arrangement with Telstra to deliver key services such as standard phone services and public payphones will ensure continuity of basic safeguards for Australians and will strengthen the safety net for rural and regional Australia. The agreement with Telstra does not preclude contestability for other key services that TUSMA will deliver under contract. Existing National Relay Service contracts are due to expire shortly and a competitive process will need to be run by TUSMA before 1 July 2013. The government is also committed to TUSMA undertaking a competitive process for the emergency call service within five years.

The member for Cowper has suggested two amendments to the bills. The government opposes these proposed amendments. The suggestion that TUSMA's administrative costs should be offset by reductions in the administrative costs of the ACMA ignores the fact that the two will be doing different things. It yet again shows that those opposite simply do not get this area of policy. In any case, decisions about the administrative costs of government agencies are made in the budget context and it is not appropriate to specify them in legislation. The proposal for an independent STS review into the quality of standard telephone services delivered over the National Broadband Network ignores the very real improvements in quality that will be delivered by the NBN and the existing reporting measures that can provide information on this issue. Furthermore, the amendment is poorly drafted and the matters to be considered by the independent reviewer are complex, vague and not easily measurable in an objective manner.

We hear a lot from those opposite about the importance of telecommunications, sometimes talking about the importance of telecommunications in regional communities, but they voted against the National Broadband Network and they voted against piece of legislation after piece of legislation which I have brought before this chamber. I note the last speaker for the opposition on this bill, the member for Canning, was on 2 February 2012 quoted in the Examiner, his local paper, complaining about the existing service and like many others demanding access to the National Broadband Network. They cannot have it both ways.

You cannot argue consistently against infrastructure and then complain that it is not being delivered quickly enough to your area when you voted against the very legislation which has provided the funding. Consistently we see that from those opposite. I must say that among all the pieces of legislation opposed by those opposite relating to the National Broadband Network, voting against a universal service obligation, as they will be doing when they vote against this piece of legislation, is extraordinary and is against the interests of the electorates they represent, particularly against the interests of those who live in regional communities around Australia. By introducing a more contestable and flexible model for providing the USO, these bills will promote greater efficiency, transparency and competition in the delivery of the telecommunications services Australians rely on, while preserving key consumer safeguards. I commend the bills to the House.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.