news Opposition Leader Tony Abbott has reportedly described the Coalition’s National Broadband Network policy as “absolutely bulletproof”, despite the fact that the Coalition has refused to formally cost the plan, and despite it containing a number of controversial assumptions which have been significantly questioned.
Under Labor’s NBN policy, some 93 percent of Australian premises will receive fibre directly to the premise, delivering maximum download speeds of up to 1Gbps and maximum upload speeds of 400Mbps. The remainder of the population will be served by a combination of satellite and wireless broadband, delivering speeds of up to 25Mbps.
The Coalition’s policy will see fibre to the premises deployed to a significantly lesser proportion of the population — 22 percent — with 71 percent covered by fibre to the node technology, where fibre is extended to neighbourhood ‘nodes’ and the remainder of the distance to premises covered by Telstra’s existing copper network. The Coalition’s policy will also continue to use the HFC cable network operated by Telstra and will also target the remaining 7 percent of premises with satellite and wireless.
According to the Coalition’s media release issued in April upon the policy’s launch, the Coalition’s policy is based on the core pledge that the group will deliver download speeds of between 25Mbps and 100Mbps by the end of 2016 — effectively the end of its first term in power — and 50Mbps to 100Mbps by the end of 2019, effectively the end of its second term. According to the Coalition’s statement, the 25Mbps to 100Mbps pledge applies to “all premises”, while the higher pledge by 2019 applies to “90 percent of fixed line users”. The Coalition has not specified certain upload speeds for its network.
Labor has costed its policy at about $44.5 billion, while the Coalition has costed its policy at $29.5 billion. However, both have stated that their policies will eventually pay for themselves, with NBN Co slated to make a return on investment on either. Additionally, the Coalition has claimed that Labor’s policy will actually cost significantly more than $44 billion.
Shadow Communications Minister Malcolm Turnbull has avoided directly answering the question of whether the Coalition will submit its alternative National Broadband Network policy to the Treasury or any other organisation for costing purposes, instead accusing the Labor Government of not being transparent about its own numbers.
The Parliamentary Budget Office has confirmed it had decided the Coalition’s National Broadband Network policy was too complex to formally cost without significant and expensive outside assistance, leaving the veracity of the policy unclear, in the absence of government or private sector examination of it.
Despite this situation, speaking about the policy today, Abbott defended the Coalition’s own numbers. According to the ABC (we recommend you click here for the full article), Abbott confirmed that neither his Direct Action climate change policy nor the Coalition’s broadband plan had been reassessed independently in recent months.
“The national broadband network policy was released many months ago by myself and Malcolm [Turnbull],” Abbott reportedly said. “The Government’s been crawling all over it. No-one has been able to question the costings. It is absolutely bulletproof.”
In the wake of the news that Turnbull would not submit the Coalition’s NBN plan to the Treasury, Communications Minister Anthony Albanese and Finance Minister Penny Wong issued a media release stating that there were alternative costing options which the Coalition could look at. The release, sensationally entitled “Malcolm Turnbull and Coalition hide broadband policy from scrutiny”, sees the pair claim that the Coalition is hiding “a multi-billion-dollar time bomb” in its NBN policy.
“Mr Turnbull claims the Parliamentary Budget Office doesn’t have the expertise to look at his broadband plan, but that doesn’t stop him submitting it to the Treasury and the Department of Finance and Deregulation for costing under the Charter of Budget Honesty,” wrote Albanese and Wong. “This is just another Coalition excuse to conceal their real plans from Australians. If Mr Turnbull has nothing to hide, he should provide his policy for independent scrutiny.”
The Coalition’s background briefing document associated with its NBN policy launch also costs Labor’s policy at $94 billion.
The news comes as debate over the Coalition’s $94 billion figure for Labor’s NBN also continues. The Coalition’s background briefing document states that for the $94 billion figure to eventuate, NBN Co’s revenue must grow much slower than currently forecast, construction costs must be significantly higher than currently forecast, more households must pick wireless alternatives than is currently forecast, and the NBN must take 50 per cent longer to build (an extra five years) than currently forecast.
However, the figure and these assumptions have been substantially challenged. Then-Communications Minister Stephen Conroy immediately challenged the $94 billion claim in April, accusing the Duke of Double Bay of “lying” on the issue. An analysis by your writer at the time published by the ABC showed that, even under the Coalition’s own working, it was unlikely that Labor’s NBN policy would cost anywhere near $94 billion, with the Coalition’s figures being based a worst case scenario for the NBN, where multiple factors went disastrously wrong simultaneously. In addition, fact-checking website Politifact agreed with Turnbull that the NBN was likely to blow out in cost, but said it believed the Liberal MP had overreached somewhat with his $94 billion total. And of course, NBN Co itself rejected the claim.
This week Delimiter published an extensive analysis of the $94 billion claim, finding that there is no basis for believing that it is correct.
Bulletproof? Hardly. Delimiter’s examination of the Coalition’s NBN background briefing paper has found it to be quite full of holes; although I suspect Abbott hasn’t actually hone through the entire thing in detail, so he may not be aware of the nuances ;) With respect to the Coalition’s NBN costing saga in general, I do believe it should be properly costed. As I wrote several weeks ago:
“If Turnbull is going to demand increased transparency from Labor on the NBN, then he should commit to the same, and submit the Coalition’s NBN policy to the Treasury for costing. It’s not enough to say that the Treasury ‘could’ look at it if it wanted to — this is a formal process and one which Turnbull should engage in. As I wrote last week, if the Member for Wentworth believes in the veracity of his policy, what does he have to lose from Treasury taking a look at it?”
Of course, we’re too close to the election now for a costings effort to be conducted on the Coalition’s NBN policy. This will be one that the Coalition will likely get away with, unfortunately.