David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

My question without notice is to the Minister for Communications, Senator Fifield. The Universal Service Obligation is a contract with Telstra to ensure standard telephone services and payphones are accessible to all. It costs almost $300 million a year. The ANAO says it does not reflect value for money and there is little transparency as to whether it is meeting its policy objectives. It said that neither ACMA nor the department verify the accuracy of performance data provided by Telstra. The Productivity Commission said that the USO is 'anachronistic and costly' and should be phased out. The Regional Telecommunications Independent Review Committee said that the NBN will effectively become the new USO infrastructure, but that, by default, the USO supports the maintenance of Telstra's copper. Does the minister disagree with any of these three assessments?

Mitch Fifield (Victoria, Liberal Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

I thank Senator Leyonhjelm for his question, his notice and his ongoing interest in the USO. The government does share the senator's concerns about the existing USO contract, which was put in place by the previous Labor government. This is why the coalition took immediate action on the recommendations of the 2015 Regional telecommunications review by tasking the Productivity Commission to conduct an inquiry into the USO.

The government tabled the PC's report on 19 June. I said at the time that a major review of the USO was long-overdue to ensure that significant taxpayer investment is achieving value for money and providing appropriate customer protections. The PC report found that the USO is anachronistic and costly and should be replaced by a new framework to reflect changing policy and market and technological realities. The report also said that the arrangements put in place by the previous Labor government suffer from a lack of transparency and accountability, which makes the continuation of current arrangements difficult to justify.

The Audit Office was equally critical of the contract, saying that it 'became the means through which the government was able to deliver sufficient financial benefit to Telstra to ultimately secure its involvement in the rollout of the NBN'. However, despite the contract's flaws, the USO does continue to ensure that every Australian can access a standard telephone service, regardless of where they live. This is an important protection for regional Australians. The government is taking a belt-and-braces approach to protecting the needs of people in regional Australia. We've introduced legislation to put new stronger safeguards in place before proposing any amendments to the existing USO. We have legislation before the parliament that will establish a statutory infrastructure provider obligation on NBN. Additionally, we have the Regional Broadband Scheme, which will provide a long-term funding mechanism for NBN's loss-making services.

Scott Ryan (President, Special Minister of State) Share this | Link to this | Hansard source

Senator Leyonhjelm, supplementary question.

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

Minister, if you exercised your option to wind back the USO funding, it could go towards improved mobile services for people in regional and rural Australia via the Black Spot Program, including a service for Hargraves, the location of my farm. Why is Hargraves still without a mobile service while money continues to be spent on the USO? Don't you want me to be able to give you a call on the way to my farm?

Mitch Fifield (Victoria, Liberal Party, Manager of Government Business in the Senate) Share this | Link to this | Hansard source

Like all colleagues in this place, I always eagerly anticipate and look forward to calls from Senator Leyonhjelm on his way to the farm or anywhere else for that matter. I'm very pleased to advise colleagues that under round 2 of our Mobile Black Spot Program, a new mobile tower will deliver coverage to Hargraves. This will benefit the Hargraves village and the surrounding community. Planning for the tower has already been completed. Telstra is currently obtaining relevant development approvals. A new tower is expected to be on air in the second quarter of 2018.

Additionally, another tower funded under round 1 of the program at Windeyer Road, Grattai, is expected to provide an uplift in coverage along the route between Hargraves and Mudgee. Again, Telstra is currently completing the design and approvals process, and expects the site to be on air in the second quarter of 2018. These are just a few of the many new towers under our Black Spot Program.

Scott Ryan (President, Special Minister of State) Share this | Link to this | Hansard source

Senator Leyonhjelm, a final supplementary question.

David Leyonhjelm (NSW, Liberal Democratic Party) Share this | Link to this | Hansard source

In view of that amazing news, Mr President, I'll take the 'Hinch option' and waive my final supplementary.