Catryna Bilyk (Tasmania, Australian Labor Party) Share this | Hansard source

I rise tonight to speak on the Telecommunications (Regional Broadband Scheme) Charge Bill 2018 and the Telecommunications Legislation Amendment (Competition and Consumer) Bill 2018. These two bills together give effect to the government's Regional Broadband Scheme. Labor will not be opposing these bills, which together legislate certainty that premises in Australia can continue to access broadband services beyond the initial NBN rollout.

The bills also introduce a new telecommunications levy, a broadband tax that will add $84 a year to the bills of up to 400,000 consumers and businesses on non-NBN networks. Given the current state of the economics of the NBN, it's difficult for Labor to oppose this tax outright, but we do consider its imposition to be highly unfortunate. This broadband tax, which will be passed on to consumers, is essentially seeking to undo some of the cost blowouts that have resulted from Mr Turnbull's mishandling of the NBN rollout.

As I've said before, the abbreviation 'MTM' is very appropriate because, while it purports to stand for the multi-technology mix, we know what it really means. What it really means is 'Malcolm Turnbull's mess'. And it amazes me that, after years and years in government, those opposite still think they can fool Australians into thinking that Labor is somehow responsible for the NBN mess that the government got themselves into, the mess that has now led to Mr Turnbull imposing his broadband tax. Their efforts are a monumental exercise in historical revisionism and one which would make the Flat Earth Society very, very envious.

I'll take a bit of time to remind those listening to proceedings about the history of this issue, just so we can get the facts straight. We know that, in the early 2000s, Australians were calling out for broadband policy. After selling Telstra as a vertically integrated monopoly, with no vision for extending internet access, the Howard government left us in a broadband backwater. And the Nationals, who were supposed to stand up for the bush, failed to push effectively for decent telecommunications in regional Australia. But, as many, many Australians have come to realise, the Nationals are merely a lapdog to their senior coalition partners. As I've pointed out time and time again in this chamber on so many issues, the Nationals have failed to stand up for regional Australia for decades.

After 18 failed broadband plans over the course of 12 years—that's 18 failed broadband plans over the course of 12 years—it was left to a Labor government to deliver a national broadband network that would provide universal coverage to regional and remote Australia. The National Broadband Network was, and remains, Australia's largest ever infrastructure project, and it's a policy of which I am extremely proud. Australians would have continued to have pride in all aspects of this project had it not been butchered by those opposite.

An important aspect of the NBN was the universal wholesale pricing regime. This would mean that the NBN users in the cities would help to cross-subsidise broadband in higher cost and less profitable regional areas. It would also restore the level playing field in telecommunications that was abandoned by the Howard government with the sale of Telstra. The universal wholesale pricing regime was supported by Labor's original business case for the NBN.

Yet we have recently heard news that NBN Co is considering abandoning universal wholesale pricing by introducing a higher charge for 50-megabit plans in the bush. The charge, according to broadband providers, could be as much as 44 per cent higher than for the equivalent fixed-line service in the city. That's outrageous. It comes off the back of NBN Co setting the same wholesale price for 12-, 25- and 50-megabit-per-second plans, which will have the effect of increasing entry-level broadband prices.

On top of this, Mr Turnbull now wants to introduce a new broadband tax. The only reason Mr Turnbull needs to introduce this broadband tax is the mess he's made of the NBN, switching from the full fibre rollout for all fixed-line connections to his inferior copper- and HFC-based network.

Let's not forget that, when Mr Turnbull was appointed shadow communications minister in Mr Abbott's opposition, the then Leader of the Opposition's instructions to him were to 'demolish the NBN'. That's right; the instructions to him were to 'demolish' the NBN. In government, Mr Turnbull carried out this instruction with great enthusiasm, replacing 21st-century optical fibre to the premises with a hodgepodge of old technologies, including HFC and the existing, decaying copper network. As Prime Minister, he continues to carry out Mr Abbott's instructions to this very day.

We were promised an NBN that would cost taxpayers $29.5 billion. The cost now has blown out to $49 billion. Not only will Mr Turnbull's inferior NBN cost $4 billion more to build than Labor's; it will also generate less revenue. We were told Mr Turnbull's second-rate version of the NBN would be rolled out by 2016, and it's now due to be completed by 2020. And what do we get as a result of all these cost blowouts and delays? We get an NBN that cannot deliver the speeds that Australians need. That's what we've got. That's what we are getting: an NBN that cannot deliver the speeds that Australians need and demand, an NBN that leaves Australia's economy mired in the 20th century with average speeds lagging behind nations such as Estonia and Bulgaria. There are no budgeted plans to upgrade the network technology even as far out as 2040. This means that, under the Liberal plans, we're stuck with this dud network for the next 22 years.

Senator Urquhart interjecting—

It's a very long time, Senator Urquhart. If the network cannot meet the needs of many broadband customers now, how many will want to purchase an NBN plan in 22 years time?

To give you an idea of the impact on revenues, according to NBN Co's own analysis, the government's inferior copper network will cost $200 million more per year to maintain and operate and will generate $300 million per year less in revenue relative to Labor's fibre-to-the-premises network. That's a $500-million-a-year revenue gap.

I've said many times in this place before and I will say again that the Turnbull government's decision to base the NBN on outdated technology has severely damaged Australia's competitiveness in the digital economy. As Professor Rod Tucker from the University of Melbourne has said, by the time the NBN rollout is complete, the technology will already be obsolete. Eventually we will catch up, but it will cost us even more billions and many more years of delay, and our economy will be held back for decades.

The government's recent thought bubble about rolling out a 5G network is an admission that their flawed, second-rate copper network has comprehensively failed to keep pace with the needs of Australian broadband consumers. Nearly one in three broadband consumers on Mr Turnbull's second-rate copper network can't achieve over 50 megabits per second. Some customers are seen reporting that their fibre-to-the-node NBN connection is slower than their old ADSL service. Yes, they're saying it's slower. A survey by consumer advocacy group CHOICE reported that 60 per cent of broadband customers on the NBN reported issues in the previous six months, including 44 per cent who reported very slow speeds and 42 per cent reporting disconnections, drop-outs and performance issues. A recent survey of business experiences conducted by the NSW Business Chamber found that switching to the NBN was costing small businesses an average of $9,000 in delays, disruptions and loss of sales. Forty-three per cent of the 850 businesses surveyed reported being either dissatisfied or very dissatisfied with the NBN. So, as we can see, something is really wrong here.

Similar stories were told at a forum in Howrah in Hobart that I co-hosted last year alongside shadow minister for communications Michelle Rowland and my Tasmanian Labor colleagues Julie Collins and Brian Mitchell. Among problems residents attending the forum reported were issues such as the performance and reliability of NBN services delivered over the fibre-to-the-node network; disappointment that Mr Turnbull has denied Tasmanian households and businesses a future-proof fibre connection and instead lumped them with poor quality ageing copper; slow speeds; dropouts and variations in service quality, with some questioning why they were being sold NBN plans with service quality and speeds that the network is not capable of delivering to their home; and the lack of accountability and consistent blame-shifting between retail service providers and NBN Co when there are faults. Of course, Tasmania's not unique, and I understand that Ms Rowland has had similar stories reported to her from forums right across Australia. It's because of the problems customers are experiencing with the slow time frame for connections and fault repairs and missed technician appointments that Labor has announced that we would introduce a service guarantee. Labor's service guarantee would provide clear standards for connection and fault repair time frames and establish penalties for underperformance.

The outgoing NBN chief, Bill Morrow, knows who's to blame for the network failures, and it seems Mr Morrow's impending retirement has made him somewhat less restrained in telling a few home truths about the NBN. Amongst Mr Morrow's recent pronouncements are that the multi-technology mix is responsible for poor customer experiences with the NBN and that the copper network has led to slower speeds and a higher fault rate. Many people who have been following the NBN rollout will probably roll their eyes at Mr Morrow's exercise in stating the bleeding obvious. But it's a big deal for the chief executive, who was responsible for overseeing the rollout, to make these admissions. As critical as some may be of Mr Morrow's legacy, the fact is that the multi-technology mix was the brainchild of the former communications minister, now Prime Minister, Mr Turnbull. Mr Morrow was given the unenviable task of rolling out this mess the best he could—or, to put it another way, he was given a not so pleasantly flavoured sandwich and forced to eat it.

It is ironic that prior to the 2013 election Mr Turnbull encouraged other broadband providers to compete directly with the NBN and now he wants to tax the very providers that he encouraged. The proposed levy deters other broadband providers from duplicating NBN infrastructure by rolling out broadband in more profitable areas. In doing so, they will have to make their own contribution to support the obligation that NBN Co has to remote and regional Australia. The ACCC has expressed concerns about this levy, saying: 'Greater substitution across technologies would also bring into question the suitability of the Regional Broadband Scheme charge as a mechanism to fund non-commercial services.'

The Productivity Commission has also said this levy should not be introduced until there is a proper reform of the universal service obligation. In its review of the USO the commission observed:

The funding of NBN's non-commercial services should, moreover, not be considered independently of universal service policy reforms.

And—

The Regional Broadband Scheme is proposed to … include only a narrow levy base. In principle, the choice of funding model for non-commercial services should seek to minimise distortions in the telecommunications market, the risk of which is heightened with a narrowly-based long-term industry levy. As such, the Government may need to revisit the merits of alternative funding arrangements for nbn's non-commercial services.

So it's clear that there is widespread concern about the poor design of the government's internet levy, which not only increases prices but also seeks to impose the cost burden on a very narrow base. As I said, Labor will not oppose this levy outright, but we will seek to improve the legislation, recognising that it is the Turnbull government's mismanagement of Australia's largest-ever infrastructure project that has necessitated parts of this new broadband tax.

Labor recognised, when we commenced the rollout of the NBN, that there was the potential for other broadband providers to compete with the network or to roll out their own infrastructure. But the potential for competition from other providers is greater when this government is using outdated technology to roll out the NBN. Had the government continued to follow Labor's plan to roll out the fibre-to-the-premises NBN, the long-term economics of the project would have stacked up without the need for a new broadband tax. After all, the bulk of revenue to cross-subsidise broadband in regional Australia will come from the fixed-line footprint.

If you have a fixed-line service that consists of fibre to the premises, one with reliable connections that can guarantee minimum speeds, then it stands to reason it will generate more revenue than an unreliable, outdated, copper based network. It will preserve an indefinite performance and reliability edge, unlike an outdated copper network. It's Mr Turnbull's broadband tax that makes up the difference, and it would've been completely unnecessary had he adopted Labor's plan and rolled out the network that Australians want and need. Mr Turnbull now owns this tax, and it's for him to explain why, when he and his colleagues want to give big business an $80 billion tax cut, households on non-NBN broadband plans have to pay an extra $84 a year to help prop up his failed, obsolete and inferior network, which is $20 billion over budget and four years behind schedule.

I now move to the other aspect of this bill, which is the Statutory Infrastructure Provider regime. This important reform provides Australians with certainty about universal access to high-speed broadband beyond the rollout of the NBN. While Labor initiated this reform almost a decade ago through the statement of expectation and issues to the NBN Co board, the government is now proposing to enshrine it in legislation. We agree that this is a natural step and appropriate, and we will support it. But let's not forget that when the Liberals were in opposition it took them some considerable time to embrace this principle. Demonstrating his ignorance of the importance of broadband, the then opposition leader, Mr Abbott, described Australia's largest infrastructure project as 'essentially a video entertainment system'. A year later, Mr Turnbull was describing the National Broadband Network as 'the most extreme example of state intervention to support broadband' and 'the telecommunications version of Cuba'. To describe the NBN enshrining the notion of universal access to broadband as some kind of communist ideal was clearly out of step with the sentiment of the Australian public. And when those opposite finally embraced the principle of universal access, they didn't do so on their own. They had to be dragged to the realisation, kicking and screaming, by the Australian public, who understood their own need for broadband. Only two years after dismissing the idea of universal access, Mr Turnbull was promising to deliver it, but sooner and at less cost. Well, we know what's happened there, and we can see today that promise isn't going so well for Mr Turnbull or his government. But I welcome the Turnbull government finally embracing the notion of universal access to broadband.

Like power, water and phone service, broadband is now recognised as an essential service for households and businesses. Of course, we're still stuck with the legacy of Mr Abbott's 2013 comment that '25 megs is enough for the average household', as five years later this sentiment is continuing to drive the Liberals' broadband policy. Having established the principle of universal access to broadband, Labor will of course support moves for this principle to be legislated. We would, however, encourage those opposite to go a step further and embrace the principle of universal access to fast, 21st-century broadband, a futureproof broadband network that will meet the needs of Australians now and for generations to come. But I'm certainly not holding my breath waiting for that to happen.

In the meantime we're stuck with a National Broadband Network that cost more to build than Labor's original plan yet is able to achieve less in terms of speed and applications, a network which, because it is failing economically, has to be propped up by Mr Turnbull's new broadband tax. It's unfortunate that we are where we're at as a result of the Turnbull government's gross mismanagement of the NBN. While the multi-technology-mix egg will be difficult to unscramble, it's not too late for those opposite to admit they got it wrong and to at least start to deploy a 21st-century NBN in the fixed-line areas where design and construction hasn't commenced.