The Federal Opposition Leader has once again taken an axe to Labor’s National Broadband Network project, claiming this afternoon it wasn’t worth spending government money on a telecommunications upgrade which would primarily be used to fuel the nation’s passion for high-end video and gaming content.
Abbott and Shadow Communications Minister Malcolm Turnbull held a press conference in Sydney this afternoon to address the Federal Labor Government’s long-awaited release this morning of NBN Co’s business case, which disclosed a number of key details about how the company will build and operate the multi-billion dollar network over the next thirty years.
However, Abbott questioned the fundamentals of the NBN policy.
“The question is, should the taxpayer be investing $50 billion in that, when there are so many other competing needs – roads, railways, ports, health, education and the mobile phone system, which still drops out frequently?” Abbott asked.
“It’s pretty obvious that the main usage for the NBN is going to be internet-based television, video entertainment and gaming,” the Opposition leader added. “We are not against using the internet for all these things, but do we really want to invest $50 billion worth of hard-earned taxpayers’ money in what is essentially a video entertainment system?”
Turnbull said most of the high-bandwidth applications being discussed for use with the NBN did not use a lot of bandwidth. And even where high-bandwidth video services did exist, he said – such as the new Fetchtv offering being launched by ISPs like iiNet and Internode – they were usable over the existing broadband networks.
The Opposition Leader agreed Australia’s current networks were still stacking up well.
“If you look at the documents,” he said, “you see that there’s only going to be 1.7 million households passed by 2013. Optus and Telstra already pass more households than this with their existing cables that are capable of 100 megabits.”
With reference to the NBN business case, Abbott said there was “absolutely nothing” in the document which persuaded the Coalition that there was a case for going ahead with the investment, which he said he had previously called “the nationalised broadband network”, but which “should probably be called the nationalised broadcasting network”, given what the Coalition said was its focus on entertainment.
This morning at their own press conference and in statements, Prime Minister Julia Gillard, Communications Minister Stephen Conroy and NBN Co chief executive Mike Quigley highlighted NBN Co’s internally projected rate of return as being 7 percent – a number which didn’t take into account any additional benefits to accrue from the NBN, such as improved productivity. Hence, the Labor argument went, the network was viable as an investment in its own right.
However, the Coalition MPs repeated their long-standing call for the NBN project to be submitted to the Productivity Commission for a cost/benefit analysis to be carried out. “The Government still does not trust its case for that kind of scrutiny,” said Abbott.
Could the Coalition cancel the NBN in 2013?
The business case discloses that in three years’ time, when the next Federal Election will come into play, the NBN infrastructure will have been rolled out to some 1.7 million premises, with most of those receiving fibre directly to their door. However, Abbott did not directly answer a question on whether the Coalition would scrap the project if it won Government at that time.
“We will give you our definitive policy on this at the appropriate time,” he said.
“The point that we make at the moment is that there is nothing in today’s document which persuades us that this massive investment in taxpayer dollars is justified, and it is just wrong to invest this kind of money in a project like this without a full cost/benefit analysis, preferably by the Productivity Commission, which Labor is running away from.”
The Opposition Leader said the Coalition’s policy would always be to “respect the taxpayer” — and claimed Labor hadn’t done that, wasting billions on “school halls” and “roof batts”. “We just don’t trust this Government with this kind of investment, particularly given that they’re not willing to submit it to the Productivity Commmisison for cost/benefit analysis,” he concluded.
And Abbott took one last potshot at Conroy during the conference, pinioning what he said was Conroy’s penchant for insisting that the NBN would have an impact on other portfolio areas such as transport, because it would allow telecommuting, for example.
“This idea that you can fix everything by putting an ‘e’ in front of it is bizarre,” laughed Abbott.
Video credit: Delimiter