Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Hansard source

I move:

That the Senate take note of the answers given by ministers to questions without notice asked today.

It was only 12 months ago that the government secured legislative support for its plans to sell Telstra. That was a sad day for Australian consumers. Twelve months of bungling, incompetence and mismanagement later, we now have an utter fiasco on our hands. It is now clear that the sale of Telstra will not be a sad day just for consumers; it will also be a disaster for existing Telstra shareholders.

As a result of the relevant ministers’ incompetence, the government now has only two realistic options left for selling Telstra: a fire sale or dumping its shares into the Future Fund—two bad options for Telstra shareholders. At this stage, the government’s only option for a retail offering of Telstra is, as I said, a fire sale, in which existing shareholders are forced to watch the government sell down its shareholdings by half. That is right: half of what they paid in T2. That is the legacy of this mob on the other side. It sold shareholders, small investors and mums and dads a pup with T2. Under Senator Minchin’s and Senator Coonan’s watch, $7.40 rose to $9 and today it is trading at $3.60 because of this incompetence.

Just last week we had the Prime Minister saying that a fire sale would be unfair to the body of Australian taxpayers and it would certainly be unfair to existing Telstra shareholders. That is right; those were the Prime Minister’s words. In my book it seems pretty unfair to Telstra shareholders for the government to sell its Telstra shares at the current market price, about $3.60, which is less than half the $7.40 investors paid to buy shares in T2. That is what you have to offer Telstra shareholders—a fire sale.

On the other hand, of course, the other option the government likes to toss around, as Senator Minchin kept intimating today, is to proceed with the sale of Telstra by dumping its shareholdings into the Future Fund for David Murray to deal with the mess. This plan has attracted almost universal condemnation in the financial press. Let’s go through them. They include columnists as diverse as Terry McCrann and Stephen Bartholomeusz, as well as Sol Trujillo—even Sol Trujillo, the hand-picked CEO ticked off by Senator Minchin who supported it every time he was asked about it—and Stuart Wilson from the Australian Shareholders Association. They all agree: dumping the government’s Telstra shares in the Future Fund will be a disaster for existing shareholders. It will be a disaster for the President of the Senate, who on his declarations has listed Telstra shares. He bought them not that long ago. He is not laughing, Senator Minchin. You might be, but let me tell you the President of the Senate is not laughing. That is four different commentators, including two journalists from different publications, a shareholder activist and the Telstra CEO, all singing from the same songsheet. It is a disaster.

It is quite an amazing situation. It is one of the few areas of common ground amongst the warring voices in the Australian telecommunications debate that dumping the government’s Telstra shares into the Future Fund will be bad for shareholders. By dumping its Telstra shares into the Future Fund, the government will be creating an overhang of shares that David Murray will use to sell into any strengthening of the Telstra share price. And I noted Senator Minchin kept trying to say it is the Labor Party’s fault—