Scott Ludlam (WA, Australian Greens) Share this | Link to this | Hansard source

I move:

That the Senate take note of the answer given by the Minister for Broadband, Communications and the Digital Economy (Senator Conroy) to a question without notice asked by Senator Ludlam today relating to the national broadband network.

I want to make a few brief comments on the occasion of the deadline for tenders for the national broadband network and in response to some of the minister’s answers to my questions earlier. I have been involved in the national broadband network inquiry, which is being chaired by Senator Fisher, which has heard evidence from a broad range of players in the telecommunications industry. We have heard strong evidence all the way through that Telstra has played an aggressive and litigious hand in its activities as the incumbent market player and that we seriously risk entrenching this behaviour, depending on the final market structure adopted as the process that is underway rolls out.

The ACCC, as the regulators, have been tied in knots with a multitude of appeals against regulatory and pricing decisions. They told the committee on 18 October that telecommunications litigation outweighs all the rest of their case load and workload in the regulatory area combined. So, everything else that the ACCC have oversight of is outweighed by the amount of telecommunications litigation, much of it brought by Telstra on pricing and regulatory decisions.

One solution to this behaviour of monopolistic practices by the incumbent that was advanced by many witnesses was that of structural separation—that is, that the ownership of the network backbone be separated from industry participants who might be providing retail services. I put this proposition to Mr David Quilty, Telstra Group Managing Director, Public Policy and Communications, when Telstra eventually appeared before the committee a couple of weeks ago. I asked what his thoughts were on structural separation as one possible means of reducing the apparent covert cross-subsidisation that occurs under the current market structure. He said:

The bottom line for us is that we have to act in the interests of our shareholders. We cannot do anything that we do not consider is in the interests of our shareholders. There is no doubt in the mind of Telstra management, and all of the analyst reports concur, that further separation of Telstra is not in our shareholders’ interests. We simply cannot contemplate it.

They essentially gave the minister an ultimatum, which has certainly not been resolved today, that they will not participate in the national broadband network if their shareholders’ interests are not taken into account as the primary concern. I am afraid that is not good enough. Broadband services are approaching the status in Australia and around the world of an essential service. It is essential that a broadband network be regulated in the public interest and not in the interests of the shareholders of one corporation that so far happens to have the upper hand.

The question I put to the minister earlier this afternoon this afternoon was, rather than handing over and further entrenching the role of Telstra, or any other player for that matter, perhaps we should take the matter back into the public arena to operate the network backbone so that proper competition can be assured. I think this is one case study, if ever we needed it, of why you do not privatise essential public services. We have created something of a monster and I think ministers on both sides of politics who have had to grapple with the behaviour of Telstra have had to deal with the fact that they are behaving as large corporations do when they are given a monopolistic position in an extremely important market. So Telstra are not behaving in any way unpredictably; I think they are behaving entirely predictably. But they are, as they have told us so on many occasions, putting their shareholders’ interests—as they have to—above the public interest. And of course that is not the minister’s job in the provision of $4.6 billion worth of public funds, which the public is putting towards the broadband network. I think it is essential that we consider taking matters back into public hands and operating the national broadband network in the public interest.

Question agreed to.