Julian McGauran (Victoria, National Party) Share this | Link to this | Hansard source

My question is to the Minister for Communications, Information Technology and the Arts, Senator Coonan. Will the minister update the Senate on proposals to provide—

Opposition Senators:

Opposition senators interjecting—

Paul Calvert (President) Share this | Link to this | Hansard source

Order! There is that much noise that I cannot hear the question. Could you please repeat that, Senator, because I could not hear the question.

Julian McGauran (Victoria, National Party) Share this | Link to this | Hansard source

Will Minister Coonan update the Senate on proposals to provide fast-speed broadband throughout metropolitan, regional and rural Australia?

Helen Coonan (NSW, Liberal Party, Minister for Communications, Information Technology and the Arts) Share this | Link to this | Hansard source

I thank Senator McGauran for his question and recognise his longstanding interest in the issue of broadband. As the Senate knows, there are a number of proposals on the cable to give Australians access to a higher speed broadband. Both Telstra and the G9 consortium have mounted competitive proposals to roll out broadband to commercial areas, including major metropolitan cities and parts of regional Australia. The Australian Labor Party has rolled out a headline grab to provide fibre to the node to 98 per cent of the population. To do this, it proposes to smash and grab the Future Fund, abolish the regional communications fund and close down the government’s Broadband Connect program. It has become blatantly obvious to telecommunications analysts that Labor has failed to do its homework with this unworkable fast-fix broadband plan. On the day Labor made its announcement, ABN Amro slammed Labor’s proposal, declaring it would take the industry back 20 years to government provision, gold plating and restricted rollout. In their opinion, it fails to resolve access regulation issues but entrenches them, adds new inefficiencies and re-establishes a conflict between government as owner, whose dividends rely on access prices, and as a regulator of access.

The damning reviews have just kept rolling in. Telecommunications researcher Market Clarity have come out today in the Australian criticising the ALP’s plan as failing to do its homework and undershooting the mark. Its chief, Shara Evans, said:

Nothing in the Labor plan really addresses the backhaul issue. It doesn’t seem to be addressing what I see as the most critical problem - getting high-speed pipes into the regions so these access networks actually have something to connect to.

It goes on. Eminent professor of economics at Melbourne University, Joshua Gans, has conceded the proposal is ‘overkill’. Ross Gittins, the economics editor of the Sydney Morning Herald, has dismissed the plan as a waste of taxpayers’ money and a cynical bribe. In today’s Financial Review, the global research firm Ovum has predicted that Labor’s broadband proposal will not have any impact until after 2010 and will be more than likely bogged down in commercial and competitive wrangles for years. According to Ovum, a raft of issues have not been addressed under Labor’s plan, such as which part of the network will be unbundled, how the multiple stakeholders other than Telstra will have access to the consumer and how they will share the revenue from the services offered on the jointly held network. Economics editor of the Australian Financial Review, Alan Mitchell, agrees. He said there are a lot of questions to be answered about the cost and value to the consumer of proposed high-speed networks. Mitchell concludes that Rudd’s political commitment to the high-speed broadband network has been made without any serious evaluation of the likely costs and benefits. Everyone agrees that it is unworkable, underfunded and will not go anywhere near covering 98 per cent of the population. What matters is a sound policy for encouraging investment in broadband in metropolitan areas and regional centres, and targeted incentives to get it to rural Australia—otherwise you will not have broadband for all Australians. The coalition government has a plan; Labor is just making it up on the run.