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News, Telecommunications - Written by Renai LeMay on Thursday, August 2, 2012 10:29 - 105 Comments
Sell off the NBN? Abbott won’t confirm or deny
news Opposition Leader Tony Abbott has repeatedly refused to confirm or deny whether the Coalition would sell off finished portions of the National Broadband Network infrastructure if it won the next Federal Election, stating only that the Coalition believed the private sector could deliver broadband to Australia better than the Government.
Earlier this week, Abbott was asked on air by ABC Radio presenter Jon Faine (a recording of the broadcast is available online here) whether the Coalition would sell those portions of the NBN which had been constructed if it won Government. A substantial portion of NBN fibre, wireless and satellite infrastructure will have been constructed by the time the next Federal Election is slated to be held in 2013, with hundreds of thousands of Australian premises already receiving fibre broadband.
Faine asked Abbott about the issue several times repeatedly, but did not receive a conclusive answer from the Opposition Leader.
“I’m not going to get into the sorts of specifics that we’ll be announcing in our policy pre-election,” Abbott responded to one question, “but certainly nationalised telecommunications is the way of the 1960’s, it’s not the way of the current century. We’ve said all along that we don’t need nationalised broadband, we need better national broadband, and we can get that using the private sector with a lot less government funding than the $50-odd billion the government has committed.”
“We certainly don’t believe in throwing good money after bad,” Abbott responded to another. “We think competition between private businesses is the best way to deliver the national broadband that we need … I’m not going to go into the precise details on what we’d do, because it’ll be confirmed in the run up to the next election. The point I keep making is that we believe in free enterprise, we believe in the free market, certainly there’s got to be regulations and all the rest, but generally speaking, we think private business is better at goods and services than nationalised industry.”
Later in the interview Abbott said if a Coalition Government didn’t proceed with what he described as “the nationalised broadband network”, it would have more funding available to spend on “useful things”, such as “roads” and the National Disability Insurance Scheme currently proposed by the Gillard Labor Government.
It is believed that this statement is inaccurate or at best highly controversial — with the NBN being expected to make a long-term return on investment rather than act as a cost. With this in mind, cancelling the NBN project would be likely to cost the Government money in the long term, rather than saving it money that could be spent on other projects.
Abbott’s comments reflect only the most recent occasion on which he has criticised Labor’s NBN project. In early July, for example, Abbott stated that Australia didn’t “need” the National Broadband Network project and the billions being invested in the initiative would be better spent on “our roads, our rail and our ports” under a Coalition Government.
“I think that federal and state Labor governments have left us with a serious infrastructure deficit,” Abbott told the ACE Regional Radio Network in Victoria at the time, “and one of the reasons why I’m so hostile to the National Broadband Network is because it’s a $50 billion investment with borrowed money that we don’t need. What we do need is much more money being spent on our roads, our rail and our ports and that’s what will happen under the Coalition.” The Opposition leader similarly criticised the NBN in May 2011, and again in January that year.
If a Coalition Government did sell off the NBN infrastructure, this action would appear to run contrary to comments recently made by the member of his cabinet responsible for broadband policy, Shadow Communications Minister Malcolm Turnbull.
In a recent interview with the Sydney Morning Herald, Turnbull stated that a Coalition Government would proceed with the NBN project. “No, the Coalition will not cancel or roll back the NBN,” he said. “The NBN will continue to roll out but we will do so in a cost-effective manner in particular in built-up areas.” The comments echo comments Turnbull made the previous month, when the Liberal MP publicly gave what he described as a “solemn undertaking” to the Australian people that a Coalition Government would “complete the job of NBN Co”, instead of ripping up the network or abandoning Labor’s NBN policy altogether.
At the time, the comments appear to represent something of a backflip for the Coalition. When Turnbull was appointed to the role in September 2010, the ABC reported that Opposition Leader Tony Abbott had ordered the Member for Wentworth to “demolish” the NBN. At the time, Abbott said he believed the NBN would “turn out to be a white elephant on a massive scale … school halls on steroids”. Abbott’s comments on the issue are likely to re-awaken fears that the Coalition would scrap the NBN project wholesale if it was elected.
To be honest, I’m not quite sure where Jon Faine got the idea that the Coalition would sell off the completed portions of the NBN, because I haven’t heard the idea being discussed in public for a while.
My opinion is that Abbott and his Shadow Communications Minister Malcolm Turnbull haven’t yet completely finalised their telecommunications policy, and won’t do so until shortly before the next Federal Election. I remain doubtful that such a policy would include a wholesale sell-off of the completed portions of NBN infrastructure — Turnbull has previously intimated that the overall NBN strategy would remain, but with substantial Coalition modifications, such as replacing fibre to the home with fibre to the node. Certainly we haven’t seen the Coalition discussing a sell-off of the NBN for quite some time.
In addition, selling off the completed portions of the NBN would be horribly messy and wouldn’t really make much sense. The current NBN network is a real patchwork affair — bits of residential fibre here and there, wireless in patches, some substantial backhaul links, and satellite stations under construction. It doesn’t seem to make much sense to sell off those bits and pieces shortly after they were built — that, in my opinion, would mediate against a long-term Coalition FTTN strategy.
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