Malcolm Turnbull (Wentworth, Liberal Party, Shadow Minister for Communications and Broadband) Share this | Link to this | Hansard source

This is the second report on the progress of the National Broadband Network, and it is fair to say that it has not progressed very far. There are 4,000 active customers of the NBN, of which less than half are actually connected to the fibre network, which was, of course, the centrepiece of the whole project. We were advised by the company—and it is reported here in this report back in September—that as at 30 June, the NBN Co. had passed 18,000 premises with its fibre rollout. In January the company published a press release in which it said that as at December 30 it had passed 18,000 premises, which can only lead us to conclude that in the intervening six months between the end of June and the end of December it had passed no additional premises.

The progress seems very slow. That is being too kind—it seems to have been nonexistent. There is also a very unsatisfactory standard of reporting the progress from the company. It treats this committee as though it is an enemy. It treats the committee as though its objective is to avoid giving it any information. It is a matter of immense regret and disappointment to me that here we have a telecommunications company wholly owned by the Australian taxpayer and the largest infrastructure investment in Australia's history, and yet the level of its accountability to the public through the NBN committee in this parliament is much less than the level of accountability of a publicly listed company to its shareholders and, of course by that medium, to the whole of the world. It does seem ironic that the telco which the Commonwealth government no longer owns—Telstra—is more forthcoming, more transparent and more accountable than the telco which it owns 100 per cent and is pouring tens of billions of dollars into.

There are many examples of the unsatisfactory nature of the information that is being provided, and I will not delay the committee with every example, but take the area of greenfields. These are essentially areas of new housing developments as opposed to brownfields areas, which are already built up. On page 17 of this progress report there is a statement referenced from the NBN Co.'s chief executive, Michael Quigley, saying that the company has passed 65,000 lots. Five dot points further down the page there is a reference to the shareholder ministers saying that the NBN Co. has exceeded its expected target with 75,000 lots passed. You would think from those two numbers that the rollout in the greenfields area was going along very well.

However, the department has subsequently had to correct this and said that instead of passing 75,000 lots—and by 'passing', what we mean is that the cable has actually gone down the street and is passing, literally, the premises concerned and is available to be connected, so it is just a question of hooking it up—that these two figures are in fact wrong. They have written to the committee and said that instead of passing 75,000 lots, the real state of progress was that the NBN Co. has:

… received approximately 1700 applications from developers … with 1188 active applications covering—

not passing—

approximately 75 000 lots …

So that means that they have had 1,188 letters from developers saying, 'We'd really like you to come and roll out fibre in my brand new housing development,' and the sum total of all those letters is 75,000 lots. Those are two completely different things. We were given the impression they had actually rolled the fibre past 75,000 lots, but, no, all they have is letters from developers saying, 'Please come and roll fibre out at some point in the future.'

All of this raises more questions than answers. What is the difference between an application and an active application? When are contracts actually signed? How long are people having to wait between putting in an application and signing a contract? How long does it take for the contractors of the NBN to actually turn up to somebody's house to deploy the infrastructure? When you look at the spreadsheets of the forward schedule for the NBN rollout, published on its website, it is hard to know where all these premises are actually coming from. The spreadsheet for the greenfields rollout, under the heading 'expected date of ready for service', shows 2,000 premises for before June 2012—in other words, passing just over 330 premises a month. The idea that the NBN is rolling out to thousands of greenfields premises a week is clearly delusional.

When you speak to people living in greenfields estates, to developers or to the private sector greenfield broadband operators, such as OptiComm, Pivot and so forth, the story is very different. Rod Binedell, a developer in the town of Beveridge, north of Melbourne, recently told the Herald Sun that he could not afford to wait for the government to deliver fibre to the premises, so he hired an existing fibre company—OptiComm—to deliver it at his own expense. Phil Smith from OptiComm told that newspaper:

There is a lot of frustration out there about NBN's responsiveness and delivery to new estates.

I think my friend the member for Chifley has complained about this himself—it shows how unsatisfactory it is when the NBN is being complained about by Labor members.

We need to remember that NBN Co. had to pass off to Telstra all greenfields estates under 100 premises, which accounts for the majority of such estates. That was done solely because NBN Co. was chronically unable to meet orders in the greenfields market. Because of the anticompetitive nature of the NBN—its monopoly over fibre rollouts—Telstra is unable to deploy fibre, so in many such cases it is deploying copper networks. It is a very disappointing situation and, as I say, we have very inadequate levels of information. We moved some amendments—regrettably they were not acceptable to the Independents and the Labor Party—which would have made a big difference here. Our amendments would have ensured that the private sector broadband companies—OptiComm and others—would have stayed in business and that a developer would have been able, if he or she chose, to appoint a private sector company to do the rollout and then that company would have been remunerated by NBN Co. at an agreed tariff per household. The work could thus have been done at a time and in a manner convenient to the developer. These amendments were rejected.

NBN Co. is increasingly looking like a very big, nasty monopolist. You see this in their interaction with the ACCC. The SAU, which is the instrument which should govern the manner in which NBN Co. deals with its customers, has not yet been determined by the ACCC. NBN Co. decided that it was going to get its customers to sign up to wholesale broadband agreements one at a time—to pick them off one by one. It decided to do so because the wholesale broadband agreements trump any instruments approved by the ACCC and therefore would effectively put NBN Co.'s dealings with its customers outside the jurisdiction of the ACCC. To their great credit, the ACCC arced up about that and was able to put a lot of pressure on the NBN Co., supported by the industry and indeed by the coalition. As a consequence, the wholesale broadband agreements that the NBN Co. is getting signed have a life of only one year, which should give enough time for the structural access undertaking to be considered and approved by the ACCC. At every step this company is acting in a way that is monopolistic. It has the arrogance and the muscle of knowing that it has a government and for the time being a parliament that is prepared to give it the power and the means to exert its influence over the industry.

One of the issues that has been a matter of controversy in some sections is the question of whether the NBN Co. is going to make broadband prices cheaper or dearer. I have made the point that the NBN Co. inevitably will result in access prices being dearer than they otherwise would be and some people have criticised me for saying that. I just want to say to the House that we really do need to get real about this issue of the economics of the NBN. We are all in violent agreement about the need for all Australians to have access to very fast broadband on an affordable basis. We all agree about that. The debate about the NBN is not about the joys of broadband; the debate about the NBN is about whether the approach the government is taking is the most cost effective, the most timely and delivers the best value both to the taxpayer and the consumer. That is the sum total of the debate. Our objection is that because they did not do their homework and because they have not done the cost-benefit analysis, whether it is buying the satellites as announced today or the fibre-to-the-home rollout, they are not in a position to say this is the most cost effective way of delivering the outcome upon which we are all agreed.

In terms of cost to the consumer we really do need to get real. When you are committing tens of billions of dollars to replacing the entire existing infrastructure of a vital industry, you cannot be sentimental or self-deluding. There are no fairies at the bottom of the NBN garden that can suspend the laws of economics. By any measure, this is a massive investment. The government says the direct capital cost will be $37 billion and its peak funding will be $41 billion. Most industry experts expect the eventual cost to be significantly higher. Some estimates exceed $60 billion. Let's face it: what was the last big government infrastructure project finished on time and on budget? Telstra are rolling out a fibre-to-the-premises network in South Brisbane. They are actually doing it and their experience is that it is taking longer and costing more than they had anticipated. So there is every reason for this project to become even more expensive.

The simple fact of life is that if you overcapitalise your business in a competitive world—let's say it is a restaurant and you go mad and put in a really flash fit-out—you will not be able to charge prices for meals that you are selling to your customers sufficient to get you a return on that investment if your competition, being better managed, is charging less. You have to meet the market. You might just have to write down your investment. Your banker might have to do some of his dough. The shareholders might do their dough. If you are a monopoly you are not so constrained. The difficulty that we have got with the NBN is that we know it is massively overcapitalised. They say we are only going to seek to get a seven per cent return on the capital investment. But that is no comfort because if the capital investment is two, three or four times more than was needed, that is still going to be an enormously high price. We must not forget—and Rod Sims has made this point many times, as have others—that one of the reasons why we have seen this massive increase in electricity prices, particularly in my state of New South Wales, is what has arguably been an overinvestment in infrastructure by the electricity companies, a gold plating partly driven by the companies and partly driven by regulation, upon which capital investment they are entitled to a regulated return. We cannot suspend the laws of economics. The NBN Co.—overcapitalised, monopolistic—is a bad deal for taxpayers and a very bad deal for consumers.

Ed Husic (Chifley, Australian Labor Party) Share this | Link to this | Hansard source

It gives me great pleasure to speak on the second report of the Joint Committee on the National Broadband Network. The report reviews the rollout of the National Broadband Network, the largest infrastructure project this country has seen, and details some of the milestones reached in the early days of this project. I also recommend that people read the contribution of the Minister for Broadband, Communications and the Digital Economy in his National Press Club speech in December, in which he outlined some of the things that have been occurring in a short space of time for a project as big as this and what has been achieved.

In 2011 there was great progress, which is also documented in the report—eight first release sites; 18,000 premises initially passed with 3,000 customers connected; the signing of big construction contracts and other associated contracts; the use of Fujitsu in new developments; a major contract signed with Silcar to assist with the construction; the use of Ericsson for wireless deployment; the involvement of Optus and IPSTAR in satellite and interim satellite services; and the outlining by the NBN Co. that over the next 12 months it will run past 485,000 premises.

With this work comes a flow-on effect. For example, $3.5 billion of NBN Co.'s procurement will be spent locally, with local firms benefiting from the investment being made through the NBN. But it is the jobs component, the employment impact, the massive shot in the arm for local skills and for Australians to be engaged on a project of this magnitude to build up skills in this massive nation-building project that we are committing ourselves to. In one major project we will upgrade the technological infrastructure of this nation, which will require a lot of people to be involved. In actual fact, given it is a significant national project, 18,000 jobs will be directly created as a result of the project—up to 23,000 if you include the indirect benefits. That is a major shot in the arm for local skills. We are going to need that number of people because when the project hits full speed it will be running past 6,000 homes a day.

Jobs, employment, training, skills—these are areas within this committee, which I am very honoured to be sitting on, that I have a deep interest in and that I have raised with the chair, the member for Lyne. We should look at maximising input from people on this project and should also recognise that this will fundamentally reshape the sector because we had a dominant vertically integrated player, which will be structurally separated. In my former role I represented employees within Telstra—and I am joined here by the member for Throsby, who also took as a badge of honour a role representing the needs of people employed by Telstra and in the sector. Maintaining jobs is certainly a big focus for us both, and I bring that focus and that commitment to my role as a member of this committee.

It does cause me a great deal of concern to know that under the deals with Telstra we have been able to establish a $100 million workforce retraining package. That is outlined on page 49 of the report, where we spell out that under the Telstra agreement the government will provide assistance to Telstra to help it retrain and redeploy staff who are affected by reforms to the structure of the telecommunications industry. The Retraining Funding Deed sets out those terms. It will conclude on 20 June 2019 and it will require Telstra to give priority to retraining staff who currently work on the copper and HUFF networks, including the wholesale copper work force and the direct field support workforce. I have been concerned because I have met with people who are looking at the prospect of jobs in Telstra being offshored. I have been concerned that jobs will be lost now, that people will not be given the opportunity to be retrained to ensure that their skills are kept and that in actual fact jobs will be offshored. There have been a number of articles in the press recently. I refer, for example, to an Australian Financial Review article of 7 December titled 'Telstra: 280 jobs to go overseas', which referred to the offshoring of 280 jobs from a key growth area in Telstra. Telstra is claiming that the move will help it achieve its growth targets and shift its focus to higher value areas. Yet they are being granted $100 million to retrain staff. I do not see evidence that they are applying that in a meaningful way. Further, a few days ago the Australian noted that Telstra had briefed staff that it planned to move an additional 73 jobs offshore and a further 26 jobs were to be made redundant. Again, this is of great concern to me because I think we should be working to bring people that are affected over. Telstra has a responsibility to ensure that those skills are maintained in the industry into the years ahead.

As I said, this is one of the areas that I am interested in pursuing. The chair of the committee has indicated that this will be an area of work we will be investigating—for example, the Telstra submission of its plan on how it will be retraining its employees. Telstra will be working with the department in basically submitting that plan, the budgets attached to that plan and, importantly, the training targets that will be committed to within it. It will need to provide six-monthly reports to the government on the progress against these plans and it has got to consult with stakeholders on how it intends to use the funds and deliver the training courses.

Within the sector itself—and again the report touches on this—there is a need for education and upskilling. ICT professionals will need to be able to undertake the development and implementation of applications within Australia that will flow as the NBN rolls out. If people turn to pages 100 through to 102 of the report they will see that while some universities had huge intakes of ICT students in Australia, Monash University has halved the size of its ICT department from three years ago. Only two Australian universities are now providing specific ICT e-health development programs. This is leading to concerns that there will be insufficient graduates to be able to meet the market's needs. ICT places have declined in South Australia by 50 per cent and in Western Australia by 38 per cent. There is a need for the industry to tackle this because we do face a situation where skill shortages may hold back the development of the sector.

I have previously spoken in the House of the value of the internet to Australia as documented by Google. It engaged Deloitte and Access Economics, which put a value of $50 billion in terms of GDP value on having access to high-speed broadband. If we provide the network and the platform through the NBN, clearly we need to have the skills around to be able to capitalise on it.

There is another group that I am concerned about as we transition to a broadband network that is faster and as people become adept at adopting technology in their daily lives. I have spoken on this in the House in reference to the House of Representatives Infrastructure and Communications Committee inquiry report, Broadening the debate on the NBN. It detailed, for example, that as countries improve their internet access and where people and businesses transition more of their functions online you may have a decline in postal services because people do not feel like they need to send letters anymore. We have seen a contraction in letter volumes. That has an impact, particularly in regional areas, in the employment of people within Australia Post. There will be more homes in Australia—more delivery points—but less mail. It is a formula that will have an impact on Australia Post. I have spoken previously about the need for the government to develop a long-term strategy to upskill people within Australia Post as letter volumes contract but at the same time parcel volumes increase because people are using the internet for retail purchasing and are needing home delivery. Australia Post needs to be filling the void there. There is a need to be able to change the skills mix within Australia Post. While Australia Post has embarked on a process of restructuring and has committed $20 million over three years to prepare its 40,000 employees for this change, structural assistance certainly is an area that needs to be examined. The member for Wentworth in his contribution yet again put out a number of myths, such as that we do not need the NBN. I have heard the member for Wentworth comment a number of times that we do not need the NBN. Apparently coalition policy is basically balanced on the member for Wentworth's iPad. He often refers to the fact that he uses his iPad and that he gets wireless access and that we do not need the download speeds that are demanded, as he would put it, by the NBN, even though, as documented in this report, the growth in data demand has been phenomenal. Between 25 and 35 per cent per annum growth in download speed has been required over the last two decades. No-one is calling for us to go back to dial-up. The demand is there just as much for upload, for example, to be able to do high-definition videoconferencing; we need to have a network that can do that. What those opposite are proposing is a patchwork approach where we do not have uniform speeds and where we do not have a uniform approach, where we rely on, for example, wireless, which in low-density areas works great but which in high-density urban areas fails to keep track with what people want.

We also have this claim that technology itself will make the NBN redundant. Those opposite point out that wireless or HFC is the way to go. As I said a few moments ago, there are major shortcomings with a reliance on HFC. In some cases it is completely overwhelmed by volume demands in certain areas. The committee report documents that there has been a huge growth in fixed line broadband and that there is a shift in demand for wireless. Mike Quigley, who gave evidence before the committee, said:

When looking at total worldwide broadband data downloads they expect the amount of traffic on mobile broadband to be one half of one per cent of fixed line network traffic by 2016 ...

That was from a conversation that he had had with people from Ericsson. Further:

We expect the number of devices to go up, but the heavy lifting of applications other than voice is going to be done on fibrebased networks.

So we are not ruling out the use of wireless; there will be a complementary mix of services, but this idea that we can just rely on wireless is simply selling short the notion of what is required of a network of this magnitude.

It has been repeated today that this is going to cost too much. The member for Wentworth, Mr Turnbull, claimed today that the cost of broadband will go up. Mr Turnbull has said that the NBN will increase retail prices. In fact, an economist used by Mr Turnbull, Henry Ergas, claimed a couple of years ago that the NBN would cost users more than $200 a month. The reality is completely different. The fact is that retail pricing over the NBN today is broadly in line with, and in many cases cheaper than, current ADSL. For example, NBN packages will start from $34.50 per month. For $37.50 per month you can get a 25-down five-up service, which is superior to anything available over copper. The independent consumer website, WhistleOut, has said that the entry level NBN prices were between 23 and 43 per cent lower than comparable ADSL2 plans. So this bogey campaign that says that the NBN will cost too much is, in actual fact, not supported by reality. The member for Wentworth said that he believed the report raises more questions than answers. The main question we need answered by the opposition is: are they able to put a credible alternative forward that demonstrates that they can do what the public wants?

And what the public wants is documented in those statistics I mentioned earlier: a 25 to 35 per cent increase per annum in demand for data that cannot be delivered under what had previously been supported by the coalition. There were 19 failed plans—they knew there must have been something that was required—so they have tried 19 times to bring in faster broadband service to Australians but have been unable to do so. The answers required are from them not from this report.

Patrick Secker (Barker, Liberal Party) Share this | Link to this | Hansard source

Again we hear the fallacy from the now government—we used to hear it when they were in opposition—that when we were in government we had 19 failed plans. The fact is: technology is a changing beast and, whenever there was an upgrade, of course we upgraded our plans; we changed the plans. And I very well remember, back in 2007, this government, when they were in opposition, promising 99 per cent coverage for $4.7 billion. We said that was not possible. We knew it was not possible. But they said, 'Oh yes, we're going to achieve it all for $4.7 billion.' Well, we are about nine times that now, and my guess is that this is going to increase a lot more. That is an educated guess, from experience in dealing with Labor governments in the past; they always blow out, just like their budgets. Even if we accept the figures of the Labor government, it is still going to cost $2,000 for every man, woman and child in Australia.

I noted that the member for Chifley in his contribution talked a lot about the jobs and skills being created locally. That certainly does not show up in the national employment figures because in 2011, for the first time in 20 years, we had no jobs growth. And, as nothing has actually happened in Barker—an electorate which is bigger than Tasmania—there are no jobs at all.

He also referred to the download base increasing by 25 to 35 per cent. That may be the case. But guess how it is mostly being achieved now. It is through wireless. If you go to anyone in this parliament, just about everyone has an iPad and a phone. And guess where they get their downloads from: from wireless—not from the NBN program. In fact, people are choosing, five to one, wireless, and it is not because of cost; it is actually because of convenience and flexibility. You do not have to be plugged into a certain spot. You can go wherever you like, provided there is coverage.

I remember—and I am sure the member for Mallee would remember—that we actually had a program; we had signed contracts, which this government, when they came in, welshed on. And that was a contract with OPEL which was actually going to cover 98 per cent with superfast broadband.

So for that reason I stand here this evening to speak on the review of the rollout of the National Broadband Network. And, given the discussion this evening surrounding the progress of the NBN, I thought it would be fitting to give the House an update on the NBN's progress in my electorate of Barker. The rollout is way behind schedule. In the second half of 2011, the NBN's fibre network was not extended to a single household—not one single household. In fact, only 4,000 households across Australia have received broadband over the NBN. And, sadly for the people of Barker, there is no progress at all in the seat of Barker. A look at the rollout map on the NBN Co website shows there are no services currently available, no construction underway, and no sites earmarked for construction in the next 12 months. So every constituent in my seat—in fact it is more than constituents; every man, woman and child is paying $2,000 for nothing. So, after four years in office, this government's record on broadband is certainly disastrous not only for my seat of Barker but also for Australia. It is a huge cost that just does not bear any cost-benefit analysis.

The rollout is behind schedule, we all know that. There has been a whole swag of rorting, overspending and misconceptions by the Gillard government. On 1 November last year, I told the House about rorting occurring in the Barossa region of Barker. Barossa couple, Denise and Richard Mahlo, were asked by an affiliate of housing developer Hickinbottom to pay $995 for wiring to ensure that their new home would be NBN compatible. The Mahlos were told that if they did not pay the $995 they would have to sign a disclaimer warning of long-term consequences. A spokesperson from NBN Co. confirmed to the Australian newspaper:

... the Nuriootpa estate was 'not an NBN development', meaning 'we are not installing nor have been asked to install the fibre there'…

Yet the rort of trying to get $995 out of the Mahlos was happening. I called on the Minister for Broadband, Communications and the Digital Economy, Senator Conroy, to come clean about the hidden costs and rorting within the NBN. It is staggering to think that the NBN is now forecast to cost at least $50 billion. As I said earlier, that is 10 times the original budget that the Labor Party went to the 2010 election with. No other country is spending as much public money on broadband. Even their saint, Obama, the one they think is so fantastic, is going with wireless. He is not talking about this NBN suggestion.

In January of this year, Mr Deputy Speaker Symon—and may I congratulate you on your elevation to the position; I am not sure whether he heard that but I am sure if he reads the Hansardhe will know—I wrote in the Border Watchnewspaper, which is a large country newspaper in Mount Gambier, about the super-spending sprees of NBN Co. I was truly astonished to find out that the NBN Co had spent a whopping $108,000 on the launch party in South Australia. It is hard to imagine what one would spend $108,000 on just for one launch party. But it was not only the South Australian launch that racked up the NBN credit card bill. Launch parties were held around the country for similar gobsmacking amounts—reportedly, $138,000 was spent in the electorate of the Independent Tony Windsor and $90,000 in Townsville. The list goes on, with disgusting amounts of money being spent on these launches. This comes after Senate estimates hearings revealed that 27 people were employed just in public relations at NBN Co. So between 27 public relations people they cannot plan cost-effective launch parties around Australia. That is truly astonishing. If we as politicians did that and used taxpayers' money, I think we would be rightly on the front page for weeks on end.

On top of that, more than $800,000 was paid to the company Weber Shandwick for a six-month contract to develop and implement a communications strategy. Oh, we have to have that communications strategy! It was also revealed that 144 of the NBN staff have a corporate credit card. Well, we all know what credit cards can do. The whole program is just out of control. I question what exactly NBN is doing with the 1,000 staff. That sure is a lot of people to run a program that is hardly off the ground.

Honourable Members:

Honourable members interjecting—

Patrick Secker (Barker, Liberal Party) Share this | Link to this | Hansard source

What is it? Four thousand people, so that is actually four connections for every person that works; that is not a good return. What is important tonight to my constituents is that the NBN will not be completed until at least the early 2020s. Technology will have made some amazing advances in that period. I would suspect, and I have been informed on very good authority, that we will actually be getting very high speed even through wireless. We have seen that in the last 12 months. Some areas with poor services will be waiting over a decade for a solution and they are not guaranteed that solution.

I point this out because currently there are no plans even in the next 12 months to roll out Labor's so-called superfast broadband in Barker. There are areas in Barker, being a country electorate, with some very rural parts. They have battled with telecommunication issues for some time. Originally it was phones, then it was faxes. Now they are having real problems and they are getting left behind. I have constituents who hear about this so-called superfast NBN and they quite rightly want to know when they will have that service at their door. The very simple answer is: not for a long time ever in the seat of Barker.

Ms O'Neill interjecting—

It is a pity that the member could not be a bit more humorous; it was not very funny. In many regional areas and parts of our major cities the quality of broadband is poor. Performance and reliability do not meet the basic needs of most residential and business users. But with our plan it would have been already in place and the rural areas would have already been serviced. Broadband should cost the same in regional and remote areas as in the city, but this government wants to hide the cost of it all. The coalition wants to prioritise broadband black spots in both metropolitan and regional areas in allocating that funding. We have had success with that in the past. Broadband must first be improved in areas where this is most urgently needed, not where it suits NBN Co to roll out its network or to make a certain Independent happy. The coalition would provide subsidies to ensure high-quality services are extended to parts of regional Australia where they would otherwise be uncommercial.

I want to call on the minister once again to provide answers to the people of Barker. Can the minister please tell people living in Angaston, Barmera, Berri, Bordertown, Kapunda, Keith, Kingston, Loxton, Lyndoch, Mannum, and the list goes on, when construction will start on the optical fibre service they have been promised on the NBN Co website? Then can the minister please let the people of Beachport, Kalangadoo, Mount Burr, Nangwarry, Port MacDonnell, Tantanoola and Tarpeena why they are missing out on the same services as those in towns situated just 20 kilometres away? The minister should tell the people how much they will have to pay on top of the $50 billion taxpayers are already paying to have internet access and what standard internet that will be.

Finally, I would like to point out that there are 94 places in my electorate that carry a postcode and have some sort of concentration of people living there. Yet on the NBN Co website only 29 of those 94 areas have been noted. What about the other 65? What can the minister tell the people living at Glencoe, Cape Jaffa, or even Coonalpyn, on the busiest road in South Australia, on the Dukes Highway, the main road from Adelaide to Melbourne? What can he tell those people? What costs will these people have to pay and what service will they be paying $50 billion for?

Deborah O'Neill (Robertson, Australian Labor Party) Share this | Link to this | Hansard source

In response to a couple of the questions that the member for Barker raised at the end, I understand the continuing cynical and negative tone that we are used to in the chamber day after day. I accept as a burden of being in this place the constant carping and negativity. But what I am finding really difficult to understand in the argument that is being put are declarations of: 'We don't want it, it's going to be no good, but when is it coming to my towns?' That sort of hypocrisy says, 'We want it, we don't want it. We wanted it yesterday, we don't want it tomorrow.' That is all we can expect and it reflects the confusion we have seen from the opposition front bench on a whole lot of economic matters this week in the House as well. I am absolutely delighted to have the opportunity to speak this evening on this new review of the rollout. I am not a member of the Joint Standing Committee on the National Broadband Network, but I did sit in on the last hearing that the committee held. I was very impressed with the quality of the responses to some really great questions. I am pleased to see this is massive, visionary, Labor-led investment in our country. Through this committee there is a requirement that the NBN rollout is discussed and reported on every six months. Critically, the terms of reference for this committee require that the committee report on the rollout of the NBN in connecting 93 per cent of Australian homes, schools and businesses to fibre-to-the-premises technology, with a minimum coverage obligation of 90 per cent of Australian premises, and on the objective of servicing all remaining premises. I am pleased to see that these matters have been included in the report. I am certainly pleased to acknowledge my admiration for the work of the committee and I applaud their efforts thus far.

As the Treasurer said in question time today, this is an issue that really goes to the heart of the difference between those opposite, who would still have us in horses and carriages, and those on this side, who wish to take advantage of the new technologies that allow us to change how we live. We on this side understand the imperative of giving our nation—our students, our teachers, our health workers and our businesses—the opportunity to have the new technologies that will connect them to the world.

I particularly want to talk about jobs. We see in this report that, as at 30 June 2011, when a submission was provided to the committee, 1,000 employees in locations across the whole of the country were engaged in the NBN Co. We are talking about a technology that will grow jobs in a range of businesses, but it is certainly growing jobs right now for people who want to be part of building this dream, this dream that will enable Australians to do the things that we cannot even imagine yet are possible. Australians have been innovative forever. They will take and embrace this technology and they will take us to great places. I suspect that when we look back in 50 years from now people will recall and speak about their part in the rollout of the NBN as we hear people speak about their part in the building of the Snowy Mountains scheme. This is another visionary project that helps Australians form a sense of identity. We have the capacity to envision, to make great big projects fit this great big country of ours and to give us a great big opportunity right there ahead of us.

These are things that define the Labor Party. We believe in Australians, we believe in their capacity and we believe that if we give them the right tools they will be able to make a really good go of it. The reality is that business understands this. Those on the other side constantly carp about how they represent business. We know the sorts of businesses they represent—those like Gina Rinehart's, which are going to benefit from the sorts of policies that these guys would like to implement through the minerals resource rent tax, taking money away from ordinary families. Small businesses, however, seem to be beneath their gaze. Businesses in my area have totally got on board with this and they understand it. The fact is that the internet contributed to 3.6 per cent of Australia's gross domestic product in 2010. That is the same as Australia's iron ore exports.

We cannot ignore this area. It requires our investment. It requires a vision for the future, not a backward-looking, carping, cynical, negative view about things that cannot be done. The Australian internet economy is likely to grow by $20 billion over the next five years to roughly $70 billion. That is twice as fast as the rest of the economy. We need to provide the capacity for that to happen. By 2016 the growth of the internet in Australia will see approximately 80,000 people employed in areas directly related to the internet.

I have seen the Nationals sit over there and profusely claim that they are representing Australian farmers; but Australian farmers need the internet. Aussie Farmers Direct now generates over $100 million per annum through selling fresh food online. AuctionsPlus sold 2.2 million sheep via an online auction process to farmers at home and overseas in 2010. This is the technology that, for the first time in our history, connects the bush with not just the cities but the rest of the world. That is what we are going to offer. This review shows that, through the processes of the initial careful rollout and the learning experiences that have been acquired by NBN Co., the next phase of rollouts is well prepared, well organised and well able to become part of our community's celebration of our movement into the 21st century.

There were a number of comments on education in the report, and that is an issue very close to my heart. I will indicate some of the things that are happening. One of the first events that happened when the Armidale site was switched on was an opportunity for high school choirs in Tasmania and Armidale to be able to sing together and interact. It was a poetic way to say that Australians can sing with one voice wherever they are. We can make a harmonious sound, leading into the future and combining all of us together as one. What we would have if those opposite had their way is a few people singing somewhere and the rest of them silenced. They cannot participate.

Avoca Beach and East Gosford have two of my local schools. In some parts of my electorate, people are able to communicate at nearly this kind of speed. There is the opportunity for them to have conversations with kids at a special school at East Gosford and teach kids at Avoca Beach how to sign the national anthem. This is a wonderful opportunity for us to build connections across communities and across the physical divides that we are so aware of here in Australia.

In terms of health, one of the good things that has been undertaken in the first part of the rollout is a couple of trial programs determined to see how we might be able to work in the health area. In Townsville in particular, some of the trials regarded diabetes and government e-health services; in Armidale it was chronic disease care; in Kiama it was mental health; and in Brunswick it was aged care and in-home monitoring and care. This preparation of the practical applications and the practical plug-ins to people's ordinary lives is well reported in this document. It indicates that this is not about a technology that is awaiting people who want to use it. There are people who are waiting to use it. There are people who are determined to use it. There are people who are desperate to use it and keen to get their share. The member for Barker was just talking about all of the towns that he wants this to come to. I am not surprised he wants to know when it is coming to those towns, because everyone in my region also wants to know when they are going to get a share of being able to have an e-health consultation, run their business from home at a decent speed and participate in the global economy.

In my area one of the very important local magazines that helps our business community keep abreast of what is going on is the Central Coast Business Review, run by a gentleman called Edgar Adams. He is a very independently minded man, but he certainly understands the capacity of the National Broadband Network to transform our local economy. For the first time in Gosford, where we have a population of 300,000 if we blend in with Tuggerah—that is, the Central Coast region—we have a structural advantage over Newcastle and Sydney in terms of being able to offer businesses an internet speed that makes them competitive with the rest of the world.

Our arguments for trying to get into the rollout—and we have been successful in achieving that—were that people at home told us that they see a very attractive return on investment for NBN Co.; there is huge local and community business support; our commuters want this because they see it as an opportunity to reduce unnecessary travel; and telecommuting from Gosford to Sydney would mean that the lives of families—where mum and dad have to get up at 20 past five, get the kids into child care at 6.30 and get on a train to get to Sydney—can be transformed by the capacity to work from home or work at a site on the coast much closer to home. The flow-on in terms of community outcomes should not be understated. There are little kids' teams, where dads and mums want to help with soccer, football, netball and swimming. Those sorts of opportunities to participate in community are made possible by having the time to participate. At the moment, the tyranny of distance from Sydney for high-quality, high-paid jobs, even at the distance of just 1½ hours, has a powerful impact in our community that can be overcome by this new technology. One of the great people on the coast who went on the record about this is an international telecommunications consultant called Paul Budde. This is his estimation of exactly what this rollout will bring in to our region—and to any region. He said:

The region will profit significantly from this early participation as it has a large commuting population, and having access to high-speed broadband infrastructure will be an enormous boost to e-commerce and teleworking applications. It will be around the NBN that new companies—and indeed new industries—will be born and the Central Coast is now well-positioned to take a leadership role in this development.

What does it mean for the Central Coast?

It means the same thing for us as it means for all those towns across the country that are waiting for access. It means that we are going to 'be seen as an ideal environment with world class infrastructure and this will attract inward investment from corporations'. He went on to say that with world-class facilities we will be able to have innovative business models that currently cannot operate in our area. It will provide wonderful training opportunities for our young locals. It will prepare them to be part of pulling the cable through and getting that infrastructure in the ground. That will enable the kids to get skills, get wages and start believing in a future. That is what the NBN physical infrastructure will offer to many young people in my area. We will also be able to deliver online training and education through this technology, which will transform our access to a range of courses that are simply inaccessible to people who are living on the Central Coast.

Before I close, I would like to speak about the big difference between our vision of access for all Australians—a fairer Australia—and that of those opposite. Access for all is something that we will deliver with the National Broadband Network. That is referred to in the document that I have. We need to make sure that the whole nation moves forward together in a strategic way over a reasonable period of time, and that is certainly at the heart of today's report. On access for regional and remote communities, we cannot go past the announcement today by the minister for communications and the Prime Minister about the satellite that will be put up to make sure that those in the regions and in the most remote areas of the country will have access to this new technology.

There is a critical piece of information that I want to put on the record that disputes some of the things that were put by the member for Barker. One of the things that he argued is that it is the demand for wireless that is increasing. They keep on with this argument that wireless will provide what we need. The reality is that, according to figures from the Australian Bureau of Statistics, the number of mobile broadband subscribers in Australia is continuing to climb. But the number of fixed broadband subscribers is also increasing, although at a slower rate. The average rate of downloads per month in gigabytes has doubled in the last 12 months for fixed line networks whereas the mobile network average download for a broadband subscriber has dropped by 20 per cent. We know that this is because a stable fibre-to-the-home network option is much more reliable. It is faster and more stable. It is like a kind of basic road service; it is like having asphalt to your door instead of a road with a bit of gravel. There is a big difference.

We cannot afford to hamper the efforts of Australians in all fields of endeavour and in all fields of business by not allowing them to have the visionary technology of the future. That technology will power the economy of the future. Those opposite offer the past and no future.

Paul Fletcher (Bradfield, Liberal Party) Share this | Link to this | Hansard source

Following on from that remarkable collection of Panglossian non sequiturs from the member for Robertson, I would like to return the debate to the issue at hand, which is the oversight of the rollout of the National Broadband Network by the committee. What do we know about how the rollout is going and how satisfactory is the committee process?

I would like to make three points in the brief time available to me. First, the committee is being provided with inadequate information and much less than would be required by a private sector investor in similar circumstances. Second, on any view the NBN Co. rollout is going extremely badly. There is no other way to put it. This rollout is hugely behind plan and the signs for investors, and that means all of us because we are all compulsory investors in this project, are flashing red for danger. Thirdly, the indicators of the commercial risk the NBN will face in terms of getting the required amount of traffic onto the network are also increasing at a steady rate.

Let me turn first to the question of inadequate information. This committee is supposed to be overseeing what we are repeatedly told is the largest infrastructure investment ever made in Australia. Unfortunately the amount of information we are provided is extremely limited. The attitude of both the department and NBN Co. has been disappointing. It has often taken a long time to get answers to questions on notice and there is often a reluctance to engage with the real issues. We have had a to-and-fro process regarding what are described as key performance indicators. By any ordinary private sector standard as to the kind of key performance indicators you would expect from a company like NBN Co. what has been provided to the committee is hopelessly unsatisfactory.

I can state with some confidence, having spent many years on the senior leadership team of a large telco, that NBN for its own internal purposes and for board purposes will be monitoring on a very close basis—very likely daily, certainly weekly or at the very least monthly—such metrics as: the kilometres of new fibre installed; the number of homes passed; the number of new connections; the number of cancellations; churn; average revenue per user, one of the most closely watched metrics in the telecommunications industry; customer acquisition costs; and customer service metrics such as call answer rates and abandonment rates in the call centres. These metrics will be reported on a budget, actual and forecast basis. That is how things are done in managing large companies like NBN Co. and existing telcos in Australia like Telstra, Optus and Vodafone. I am very confident that reports of this nature are going to the board and management of NBN Co. on an extremely regular basis, but very little of this information comes to the committee. Instead we are repeatedly exposed to this charade where we ask for information, there is a lengthy and elaborate dance of the seven veils before a tiny bit of information is dropped before us.

Let me make a simple plea to the department and to the management of NBN Co. to give us just this simple thing: a consistent report every six months just in respect of the fibre network, not the wireless or the satellite network. NBN Co. has a bad record of trying to confuse the position by quoting fibre and satellite numbers together. I would like NBN Co. to be able to provide a report to the committee which addresses the following three metrics on the fibre network: first, the number of homes passed by the network; second, the number of homes connected to the network; and, third, the number of services in operation—three core metrics that NBN Co. I am certain will be tracking very closely and almost certainly on a daily basis.

It is very hard not be highly suspicious when in its public statements NBN Co. flits between these different metrics which mean very different things. As I have already mentioned, it is highly misleading of NBN Co. to report conflated together satellite numbers and fibre numbers when at the moment the fibre services are being provided over the network NBN is building but the satellite services are being provided over a satellite operated by another operator under a contract with NBN Co. I do not criticise that arrangement by the way. I think it is vastly more sensible than the extraordinary decision announced today for NBN Co. to own and operate its own two satellites, but that is another matter. I would also like to add to my simple request that NBN Co. report those metrics on a basis where they compare what is in the business plan with what the actual number is. I do also make the point that they could quite easily produce it with far greater frequency than six monthly, but let me start with that basic and simple request and see whether it is responded to or, as I rather gloomily expect, whether it will be ignored. In sum, on the first point, as a mechanism for scrutiny and oversight this committee is not working well at all.

On the second point, what can we glean from the scraps and fragments of information which NBN Co. deigns to share with the national parliament, the people's parliament, charged with overseeing this massive project, this massive piece of public expenditure? What can we glean from the information that has been provided? The answer is simple: this rollout is going very badly. If this were a private sector organisation conducting this rollout, I put it to you that the management team probably would not be retaining their jobs at this point.

In June 2011, according to the business plan, there were supposed to be 58,000 premises passed by the fibre network. By June 2012, according to the business plan, there are supposed to be 259,000 premises passed by the fibre network. On a straight line interpolation that would mean that, as at December 2011, we should be at around 160,000 premises passed. We are nowhere near that number. In late October, NBN Co. disclosed that it had passed 18,200 premises in the three Tasmanian and the five national first-release sites. The information I have received from sources within the telecommunications industry is that the rollout is proceeding very slowly indeed and, although NBN Co. announced last year with great fanfare a number of contractors to build the network in a range of different states, very little is actually flowing to those contractors. Very concerningly, if the NBN Co. business plan is to be achieved, as the committee's report notes, it is supposed to scale up to reach the performance level where it passes 6,000 premises a day. There is very little in its performance to date to give any confidence that it is going to achieve that objective.

The Labor government's policy on NBN was announced almost three years ago, and what has been achieved to date is quite underwhelming. They have received $1.3 billion of equity from taxpayers and have so far racked up accumulated losses of $400 million, and the build is, as I have indicated, very substantially behind plan. I would draw one recent comparison with the outcome achieved by a private sector company. Several years ago, Telstra set out to build its Next G network, its new 3G network, nationally within a 12-month period. That was achieved. It was quite a significant and in fact quite impressive engineering outcome and a good indicator of the benchmark NBN Co. ought to be aiming for. They are a very long way behind it.

I have talked about homes past. A very different metric is services in operation—that is to say, the number of premises taking a service and generating revenue. By June 2011, according to the business plan, we were supposed to be at 35,000. By June 2012, it was going to be 102,000 fibre services in operation. Again using straight line interpolation, NBN Co. was accordingly planning to be at around 70,000 fibre services in operation in December 2011. In January 2012, NBN Co. proudly reported it had 2,315 customers using the fibre network. That is why I say that, on any objective measure, this rollout is going very badly indeed. If you were a private sector equity investor in this project, right now you would be hitting the brakes and going for a complete restructure.

The third point I want to make in the brief time available to me is that while on the one hand the build is going very badly, on the other hand the drumbeat which indicates the scale of the commercial risk inherent in this project is gathering more and more every day. This business plan depends upon almost all Australian households taking up a service on the NBN. It also depends on customers moving up to higher tier, more expensive plans in very large numbers—in other words, taking more data and paying more. If those two things do not happen, the business plan will be spectacularly missed.

Why should Australian citizens care? They should care first of all because all of us are compulsory investors in this project, and the massive financial mess that is being created here will have to be cleaned up at the taxpayers' expense. Secondly, if you have a project which turns out to be a yawning financial disaster—and all the indicators are that within a few years that conclusion will be unavoidable—it is very hard to see how the build is ever going to be completed or indeed progress substantially.

Let me offer a couple of pieces of evidence as to why I say that the indicators of commercial risk are growing substantially. I fear that I cannot match the member for Robertson's Panglossian optimism, but I do have a bit of evidence, which is something she did not seem to burden herself with in her remarks. First of all, let me point to a report from the communications regulator in the UK, Ofcom, which in August 2011 reported that 57 per cent of homes were able to receive what were defined as superfast broadband services—in the UK the definition of that is 24 megabits per second. They were able to receive those services from two major operators: British Telecom, using the copper network, upgraded in many places to fibre to the node and over time with some fibre to the premises; and Virgin Cable, which offers services over the cable network with technology very similar to the cable networks of Telstra and Optus. The Telstra and Optus networks are the two networks which are, insanely—and I use that word advisedly—going to be completely overbuilt by NBN Co. under the NBN business plan, and those companies are to be paid to cease providing services.

In August 2011, 57 per cent of British households could receive a superfast service. Only two per cent of households subscribed to such a service. Why? Because people have consistently demonstrated that they are not willing to pay the extra cost to upgrade to a higher tier of broadband. They cannot see a use for it. I refer you to my earlier comments that the NBN Co. business plan is premised on massive numbers of customers taking the higher tiers and paying more.

The other point I wish to highlight is the ever-growing risk from wireless. Let us remember the business environment NBN Co. is going to face. It will have a monopoly over fixed line but it will be competing with Telstra, Optus and Vodafone, and potentially others, using wireless. Those three companies, and potentially others, are about to introduce—and in some cases have already introduced—fourth-generation wireless, or so-called LTE. Let me quote from a recent report from Goldman Sachs:

We believe that the arrival of LTE/4G heralds the beginning of a period where wireless broadband will become a true substitute for fixed broadband services.

Goldman Sachs went on to estimate that up to one million people could be tempted to ditch their fixed broadband services for wireless broadband with the arrival of 4G.

This does not augur well for the business prospects of NBN Co., because in selling its product it will be competing against privately owned companies, which are invariably better at sales and marketing than government owned monopolies. I hate to disrupt the conventional wisdom on this topic, but this is what the experience suggests is true. It will be competing against those companies, and they will have a very competitive and attractive technology to sell. This is bad news for NBN Co.'s business plan. The evidence is that NBN Co. is not going well and the prospects are not good.

Michael McCormack (Riverina, National Party) Share this | Link to this | Hansard source

The National Broadband Network has been one of the most contentious issues debated in this, the 43rd Parliament. There is a good reason for that. The NBN is one of the largest—as opposed to greatest—investments ever made by a Commonwealth government. It was the subject of considerable industry and political debate before construction began and will rightly be the focus of close scrutiny into the future. The estimated cost of the network has been the topic of much conjecture. On 20 December 2010 NBN Co. Ltd's corporate plan indicated that the estimated total capital expenditure for the project was $35.9 billion. But, as the shadow Treasurer told the ABC's Lateline only last night, the NBN will now be a slug to taxpayers of more than $42 billion. That figure will surely only grow. Some industry experts have warned it could exceed $60 billion. What a commercial risk—no cost-benefit analysis and no business plan. As the Leader of the Opposition noted yesterday, the cost will ultimately be more than $50 billion of borrowed money that at this point in time we cannot afford to spend.

This is money that I have steadfastly maintained should have gone into health. Better hospitals and more specialists, doctors, nurses and allied health professionals are needed, particularly in regional Australia. The money being pumped into the NBN could have built many hospitals and gone a long way towards bridging the ever-widening health divide between regional and metropolitan areas. Alas, it is an opportunity lost. This is a government which cannot be trusted with money. This is a government which cannot be trusted to deliver on its promises. This is a government which has failed the infrastructure test. It failed to go even close to getting value for money with its $16 billion Building the Education Revolution program, which led to the school halls fiasco. It failed to properly manage a scheme to put pink batts into ceilings, which cost taxpayers so much money and led to houses being burnt to the ground and in some cases, tragically, lives being lost. It has failed to even so much as contemplate building the dams our nation so desperately needs for water storage and to mitigate flooding but is happy to buy water for so-called, yet not proven, environmental needs from valleys where farmers grow much of our food, thereby destroying the economic viability of those valuable regional communities.

This government and, moreover, this Prime Minister say they are focused on jobs, and that is correct—but only some jobs: those of the Prime Minister and the coterie who still support her as talk of leadership challenges looms larger by the day. We have heard much talk about how the NBN will create jobs and wealth and will open up regional and remote areas, just like we are being told about all the green jobs the clean energy bills will produce. This government is big on talk but lazily low on delivery. The carbon tax to be implemented from 1 July will spurn investment and send jobs offshore. The NBN will bring connections of up to one gigabyte per second—at a cost to householders of course—but does it pass the equity to regional Australia test? No. Is it a good and prudent investment at a time of global financial strife? No. Does spending $11 billion buying back Telstra's copper wire network and closing it down make any sense? I am afraid not.

Meantime, people in the Riverina—and indeed right across rural and remote Australia and in many districts close to capital cities too—simply want better mobile coverage. In many of these places there is reasonably flat country. Granted, in others hilly terrain makes mobile telecommunications difficult and an expensive exercise for the provider. Bob McCormack at Murrulebale, north of Marrar, continues to press hard for a decent mobile signal. I am pleased to report that Telstra's Riverina-Murray hierarchy has agreed to meet with locals in this district, which also takes in parts west of Old Junee, at a date convenient to all. I have only in the last hour been able to convey this good news to Bob, who is always hard to catch because his mobile is usually out of range.

There are similar black spots right across my electorate which is, granted, at more than 61,000 square kilometres—not quite as large as yours, Mr Deputy Speaker—one of the largest in New South Wales. Still, why should people in the Riverina or the two larger electorates in the state of New South Wales, Parkes and Farrer, have mobile services that are inferior to others anywhere else? Riverina black spots include Tooma, near Tumbarumba, where both a fire and flood have taken a devastating toll on roads, bridges and properties in recent times. Lack of adequate mobile coverage proved frustrating and dangerous during these hours of need. Pockets around Gundagai, Grong Grong, Humula, Mangoplah, Sebastopol, Tallimba and Tarcutta, to name but a few, are places in the Riverina where residents, hardworking regional Australians, are denied access to decent mobile coverage. These people, I know because of the concerns expressed to me, are far more interested in improved mobile access than they are in the rollout of the NBN. This is not just an issue of convenience; farmers do not necessarily want to chat while they are operating their headers. They do want to be able to call someone in the event of emergency. This comes down to a matter of safety. An overturned tractor, the whiff of a potential bushfire, the need to call if someone is in distress and requiring help ought to be of paramount importance to all.

Admittedly, there will be benefits associated with the NBN. With the amount of taxpayers' money being poured into this project, you would certainly hope so. These benefits certainly include health. I know one doctor in my electorate, Dr Ashley Collins of Temora, who is eagerly awaiting faster upload-download speeds to assist his marvellous innovation, TeleMedicine Australia. Dr Collins is the first supplier of medical technology for telemedicine at primary care and aged-care level in Australia. This includes telemedicine carts, telemedicine devices, complete telemedicine encounter management solutions, and applications software for both live and store-and-forward telemedicine.

TeleMedicine Australia designs and produces highly advanced, easy-to-use carts, a wide range of customisable telemedicine carts equipped with a high-definition quality videoconferencing system suitable for general practitioners and primary care clinics, aged-care facilities and rural and remote hospitals. The cart can gather and register medical information from patients and share it with the GP and/or consultant during a live video consult or through the store-and-forward system, hence the need for fast internet speeds.

I have written to the new health minister as well as the Minister for Broadband, Communications and the Digital Economy on behalf of Dr Collins seeking meetings with them because I know how interested they will be in what he is doing, and I would like to think they will be able to help him progress TeleMedicine Australia further. Dr Collins is closing the gap between city and country access to specialists and could potentially revolutionise the way health care is delivered to Australians in rural, regional and remote areas, alleviating burdens already affecting access to medical services in these areas.

While obviously hands-on medical treatment will always be a better option than videoconferencing, the NBN will, once it is delivered to Temora and via Dr Collins, hopefully put local patients within reach of medical help they could otherwise not have hoped possible. I am thrilled that this technology is already in place in my electorate—that is, TeleMedicine Australia—even before the NBN and I congratulate Dr Collins on his accomplishment thus far and his genuine desire to ensure Australians anywhere in the country have access to top-level specialists.

Given the restricted number of GPs and specialists in rural locations, including Temora, Dr Collins's initiative has great potential and the NBN could certainly enhance that. This is where the NBN can help the bush. But the rollout is not, from all reports, going well. The government is yet to release an exact map or list which will identify which towns will not receive the fibre. As a rule of thumb, towns with more than 1,000 premises will get fibre-to-the-premises connections. Those centres with fewer than 1,000 houses will not. Across the Riverina electorate that is a lot of towns and villages.

Taking advantage of having the NBN come to a nature strip near you will also come at a high cost. People generally have thus far not been knocking down their front doors to sign up. The rollout of the NBN, so far in electorates important to keeping Labor in office, will take time and it remains to be seen if this can happen on time and within budget. So far, Labor has not been able to do anything on time and within budget, even in its so-called year of delivery and decision in 2011.

The Rudd Labor government failed to keep its core election promise to provide fibre to the node to 98 per cent of all Australians, leaving more than two million people outside its broadband network, including many towns in the Riverina. The coalition committed $3.3 billion to building and future-proofing a fast telecommunications and broadband network in regional Australia which would have covered the entire country. But under the Rudd Labor government this program was scrapped. No surprise there, because Labor does not really care about regional Australia. Gillard Labor has not shown anything to suggest regional Australians should have confidence in the government's ability to roll out a fair, cost-effective and efficient National Broadband Network. Hopefully, for the sake of the taxpayers of this nation, the NBN will come about on time and within budget and benefit those able to access it.

Debate adjourned.

Main C ommittee adjourned at 19:15.