Shadow Communications Minister Malcolm Turnbull has described claims by Prime Minister Julia Gillard this morning that a Coalition Government would “dig up” NBN optic fibre out of the ground instead of using it as “ludicrous” and “false”.
Gillard made the comments at a press conference in Canberra following the announcement that the Government and NBN Co had finally inked their $11 billion with Telstra to use the telco’s infrastructure and transfer customers onto the NBN fibre.
“The Opposition is determined to destroy the NBN,” Gillard said. “I anticipate the Opposition will go to the next election saying they’ll dig the cables out of the ground.” The Prime Minister stated that Opposition Leader Abbott had given Turnbull instructions to “destroy” the NBN, adding: “You destroy the NBN by ripping up this agreement, ripping the fibre out of the ground and keeping this nation in the past.”
However, in a statement early this afternoon, Turnbull said Gillard’s claims that the Coalition would rip the NBN fibre out were “false”. “That the Prime Minister needs to make such ludicrous statements about what the Opposition may do once in Government shows her political style is not heavily dependent on rational debate,” said Turnbull. “Unlike Labor, the Coalition would never waste taxpayers’ dollars to win a political point.”
Turnbull said he had stated repeatedly in public that the Coalition would seek to get best value for any infrastructure installed under the NBN policy, highlighting comments only this morning to the ABC’s AM program to that effect.
“There’s no question of anything being destroyed or ripped up or terminated or anything like that,” Turnbull had told AM. “I imagine that a lot of the infrastructure that will have been built by the time of the next election, you know, will have a value but it will be a lesser value than its cost. But what we’ll endeavour to do is ensure that going forward the NBN is constructed in a way that ensures that consumers get fast broadband everywhere regardless of where they live using a mix of technologies that best suit the particular locations.”
The Telstra agreement
Separately, Turnbull also today handed a heavy dose of criticism on the Government’s deal with Telstra this morning. NBN Co has also announced an $800 million contract with Optus. Both telcos are planning to shift their customers off their existing HFC cable and copper-based infrastructure networks and onto the NBN, although Optus has not yet clarified its plan for its customers on Telsra’s copper network.
“Telstra understandably negotiated the best deal for its shareholders. Senator Conroy negotiated the best deal for Labor’s political interests,” said Turnbull, in a statement entitled Conroy holds gun to Telstra’s head — shoots own foot.
“But no one at the table sought the best deal for the millions of Australians whose taxes will bankroll the $50 billion NBN and pay Telstra to scrap its copper network.”
Turnbull said the fact that other fixed-line broadband networks — such as Telstra and Optus’s HFC networks — would be shut down meant that competition in the telecommunications sector would be impacted.
“Right now many Australians are using very fast broadband over the Telstra and Optus HFC cable network,” he said. “[Those networks] could have provided real competition for the NBN and in doing so kept prices low, but in this extraordinary deal those HFC networks will not be allowed to compete with the NBN. The ability of the monopoly NBN to charge high prices will be unchallenged.”
Turnbull said there were also elements of the deal which appeared to be overly favourable to Telstra.
For example, the Liberal MP said, the contract committed the Government to paying Telstra $290 million every year for the next 20 years to deliver basic services under the Universal Service Obligation to remote areas. “This is an extremely generous deal for Telstra – up to $5.8 billion for services which if the NBN is rolled out Telstra will only have to offer to 7 per cent of Australians,” he said.
The Government had also failed in that it was paying Telstra to decommission its copper network, but not acquiring the right to use that copper — “even the last few hundred metres” — if a future Government decided to build a network at a lower cost or “open up facilities-based competition”. Alternative proposals to the NBN have included the idea that a fibre to the node network could deliver similar aims, using the last few hundred metres of Telstra’s copper network to do so.
Turnbull also slammed the Government’s industry restructuring strategy in general, stating the Telstra/NBN deal was “the slowest and most expensive way” of achieving structural separation of Telstra. “Separation will take eight years, compensate Telstra with payments equivalent to a third of its current market capitalisation and disadvantage Telstra’s competitors in gaining access to infrastructure in the meantime,” Turnbull said.
Further comments from the Shadow Communications Minister are expected later this afternoon following a doorstop interview session scheduled in Canberra at 1:15pm.
Image credit: Office of Malcolm Turnbull