“Labor mindset”: Turnbull denies cost/benefit hypocrisy



news Communications Minister Malcolm Turnbull has denied there is any hypocrisy in the Coalition Government not waiting for the same kind of cost/benefit analysis to be conducted into its broadband policy that it demanded from the previous Labor administration, accusing his critics of being ‘stuck in a Labor mindset’.

In Opposition, one of the central criticisms which Turnbull levelled at the then-Labor Federal Government was that it had initiated its popular NBN project without conducting a cost/benefit analysis into the project’s fundamental underpinnings. Such cost/benefit analyses are commonly conducted by government agency Infrastructure Australia.

“The Gillard Government must urgently undertake a thorough cost-benefit analysis of the network. Its stubborn failure to do so can only lead us to conclude that it does not want to know what that analysis will reveal,” wrote Turnbull in an article on the subject in 2010. He would go on to repeat similar comments many times over the successive three years.

The Coalition’s broadband policy document released in April 2013 (PDF) states regarding Labor’s NBN project: “NBN Co was created as a taxpayer-owned monopoly with a mandate to replace Telstra’s copper with fibre (and achieve a competition policy objective: the separation of Telstra’s network from its retail business). This decision was made in haste with scarcely any analysis of alternative options and with no attempt to measure its costs or benefits. ”

It further adds: “Labor’s re-establishment of a public monopoly in a crucial sector of the economy, and its archaic refusal to weigh options, costs and benefits, or seek genuinely expert advice, demonstrate disdain for the proven policy principles of the past 30 years.”

To address this problem, in mid-December Turnbull appointed a panel of experts, to be led by Michael Vertigan, a senior top-level Tasmanian businessman and executive who has also served as the secretary of the Department of Premier and Cabinet, as well as having an involvement with a number of other Tasmanian initiatives.

The panel is to conduct what Turnbull described as an “independent” costs/benefit analysis and review of regulation associated with the NBN. The analysis will analyse the economic and social costs and benefits (including both direct and indirect effects) arising from the availability of broadband of differing properties via various technologies, and to make recommendations on the role of Government support and a number of other longer-term industry matters. It is expected to be handed down in mid-2014.

However, last week Turnbull revealed the Government had already ordered NBN Co to go ahead with its controversial “Multi-Technology Mix” option for its network rollout, before the Vertigan Review could hand down its report. The model will need less up-front capital than Labor’s all-fibre plan, but has been criticised as being more risky and for being technically inferior.

In an opinionated article published on the ABC’s The Drum site this morning (we recommend you click here for the full article), Turnbull argued that there was no reason to be outraged by the Coalition’s decision to progress with its broadband policy without receiving a cost/benefit analysis into the issue.

“Some people have said that it is an outrage this SoE has been delivered prior to the Vertigan panel’s completion of the cost-benefit analysis (CBA) of the NBN, due in the middle of the year,” he wrote. “This shows that our critics are still stuck in a Labor government mindset of technology choices being made politically, if not ideologically.”

“The results of the CBA will be very helpful to both the Government and NBN Co and they will certainly influence the rollout … The reason for providing the SoE now is simply so that NBN Co has the formal approval from Government for continuing with its move to a multi-technology approach.”

Turnbull’s move to go ahead without a cost/benefit analysis into the Coalition’s MTM option for NBN Co’s rollout has attracted strong censure from most commentators on the issue.

In an article for The Drum yesterday, long-term telecommunications commentator David Braue pointed out that it was possible that the Vertigan Review would reject Turnbull’s MTM approach to NBN Co’s rollout as being not the best option in the long term, when compared with Labor’s all-fibre model.

“It’s one thing to change the NBN, as Turnbull has made no bones about promising he would do,” Braue wrote. “But when a Minister who was basically elected into his current position by his strong and unwavering call for better governance decides that those governance rules simply no longer apply to him because it’s inconvenient – this is cause for concern.”

ZDNet Editor Chris Duckett added: “By abandoning any pretense of fiscal responsibility and proper governance in the Coalition’s stewardship of the NBN, Turnbull is now covered in the same muck that he skillfully hurled in Labor’s direction for years.”

Turnbull’s response on this issue should not be a surprise at all. We’ve seen the same approach from the Communications Minister for some time. Attack, attack, attack, on all fronts, taking as hard-line and ideological approach as possible (another good example is Turnbull’s character attacks on founding NBN Co CEO Mike Quigley), but when displaying the exact same behaviour which he has criticised in Labor, deny that the same rules apply to him.

Turnbull’s article today also has the same character of many of his previous responses when criticism has been levelled at the MP from the media: Attack the media itself. On previous occasions Turnbull has accused Australia’s technology media of being “parochial”, “NBN cheerleaders” and even “pro-NBN zealot journalists”. It should not be a surprise to see the Minister using the same tactics here and accusing his media critics of being stuck in the past, merely for the crime of pointing out his obvious hypocrisy.

Informed readers will realise that it is not the content of what Turnbull has said in his article today that is actually important. The mere fact that the Minister has felt it necessary to react in this way reveals he feels he is under pressure on this issue, and this is the real underlying truth here. If Turnbull wasn’t bothered by the criticism, he would simply ignore it.

As I wrote last week:

“The IT industry is highly aware that Turnbull has, only a few months after the election, completely abandoned the policy the Coalition took to the election, installed his own cronies at NBN Co and is pumping out a series of heavily compromised audits and reviews, some of which appear solely aimed at ensuring Labor will never win power again. Along the way, the Minister is regularly saying one thing and doing something completely different, including blithely taking steps which he strongly criticised the previous Government for.”

Accountability is important. Turnbull’s response demonstrates squarely that he knows he is in the headlights right now and that the public is aware of his hypocrisy on the cost/benefit analysis issue. I suggest people maintain the pressure on the Minister to perform his duties in a competent manner and with integrity. We should expect nothing less of a Minister of the Crown. In fact, we should expect the highest standards from people in such a position: Not, as some are currently displaying, among the lowest.

Image credit: Parliamentary Broadcasting


  1. “Accountability is important.”

    The Honourable Liberal Member for Wentworth, has none.

  2. “I suggest people maintain the pressure on the Minister to perform his duties in a competent manner and with integrity. We should expect nothing less of a Minister of the Crown.”

    Would it do any good? I doubt it. I think Turnbull is as described by Dr Bendan Nelson.

    “[Turnbull’s] got narcissistic personality disorder. He says the most appalling things and can’t understand why people get upset.”

    Later in the article it goes on to discribe the behaviour of full blown NPD, and it describes his current behaviour:
    Professor Quadrio
    “You want a leader who has the courage of their convictions but when it gets to the point when they’re destroying everyone who gets in the way, that’s too far.”
    “If someone’s so convinced they’re right and everyone else is wrong and the only way of doing something is their way, you’d say then that someone’s sense of their way being the right way has gone berserk”

    • “Would it do any good?”

      I would say yes it will. Most politicians when acting as individuals are decent enough people. Vested interests can get their ear but usually it is the party as a whole that somehow steers toward granting those favours. However when faced with losing government, they will bend unless the party sees the compromise as having severe long term consequences.

      Having said that while most politicians are desperate to get their 8 years of service and guaranteed retirement perks, Malcolm by far our wealthiest politician has different motivations and isn’t it interesting what Brendan Nelson said.

      From the interviews and panel appearances he has made over the years my thoughts are that Malcolm has a special place in his head where he is right and there is not the slightest possibility that that fundamental truth could be challenged. The problem is that Malcolm is very intelligent and capable and for most of his life that has translated into success. With the NBN and the Australian telecoms industry he is out of his depth with his thoughts and ambition and in the end the country will pay a very heavy price for his unique personality.

  3. “The mere fact that the Minister has felt it necessary to react in this way reveals he feels he is under pressure on this issue, and this is the real underlying truth here. If Turnbull wasn’t bothered by the criticism, he would simply ignore it.”

    Eventually, anything under pressure has to be relieved somehow, maybe if we keep on him enough, he’ll pop and he’ll actually start doing the right thing.

    Though i won’t hold my breathe for it!

    Also, what are the various codes for the comment box to make italics, etc…?

  4. My favourite bit:

    The pure financial differences between fibre to the premises (FTTP), fibre to the node (FTTN) and hybrid fibre coaxial (HFC) are all set out in the strategic review but it does not consider the economy-wide externalities (if any) that may be associated with making FTTP available.

    Malcolm is already pre-empting that there will be no economy-wide externalities that would make FTTP viable. This is just another sign that the CBA is a sham.

    • A serious CBA into a government activity really should consider externalities. The Vertigan Review’s terms of reference define this *very* narrowly, and the issues framing paper the Vertigan Review produced when soliciting public comments made no attempt to obtain public opinion or in any other way quantify what these benefits might be. Given they arn’t looking for any, it would be a big surprise if they did find some.

  5. This is indicative of Liberal governments across the country – say one thing in opposition, do the opposite when in power.

    Barry O’Farrell, while in opposition, routinely had massive shots at Labor in NSW on corruption issues. Bit hypocritical given todays events… At least he did the right thing and stood down without trying to justify it. Ironically, I had very little respect for him before today. My opinion of him actually went up a little for that decision. Shame it had to happen over something like this.

    Same thing has happened in Queensland. Say one thing in opposition, Campbell Newman does the opposite in power.

    And none of them can see the hypocrisy… Its indicative of the mindset needed to be a Liberal politician.

  6. So… where are all the floods of criticism from all the expert economists, lecturers and bean counters on how terrible it is that the Coalition has rushed through w/o a CBA?

    *crickets chirping*

    … yup. Just as I thought…

    • It’s not so much the fact he has done this bud – many projects have been done without a CBA;

      it is the extreme hypocrisy in regards to his cynical stance on labour acting with out a CBA and his contempt for process in fast tracking his/ the coalitions agenda.

      … and there is plenty of commentary on that.

  7. I’ve come to the conclusion that Turnbull is either trolling us, or he has a genuine mental handicap. How else can he say:
    “This shows that our critics are still stuck in a Labor government mindset of technology choices being made politically, if not ideologically.”
    With a straight face?

  8. Hypocricy #2: “… our critics are still stuck in a Labor government mindset of technology choices being made politically, if not ideologically.”

    Over the past three years – and indeed in this very piece – Turnbull has denigrated fibre optics as “too expensive”, creating the public perception it’s the Ferrari of cabling.

    Hypocricy #3: “… Labor made a thoroughly political decision to use FTTP for 93 per cent of the country”
    The ALP’s tecnical position was to roll out FTTN, but switched to FTTP on the advice of a panel of experts. The FTTP approach specifies a minimum tecnical standard for infrastructure that allows a market to determine the appropriate capitalisation of the rest of the industry to deliver whatever capabilities people need. The MTM approach has a politician dictate what everyone needs.

  9. Yeah 100metres at that speed that looks about right from the drop-off diagrams.
    But yeah like stated, that won’t be realistic out in the streets, a node every 100metres, that’s a lot of nodes!
    and line condition ect.
    Why couldn’t they have done a few tests at the same time? Like around Australia, different locations, etc..

  10. I don’t really agree that the FTTN CBN has “less up-front capital” than the FTTP option.

    Considering Ziggy is now talking about buying the CAN outright, that figure would need to be added to the overall cost of the project, and considering how close the numbers actually were, I think we’ll find the FTTN option will actually turn out to be a more expensive option.

    I’ve been saying it for ages, Malcolm’s FTTN HAS NOT been done anywhere else.

    Every other instance for FTTN in the world involves an incumbent who already owns the copper. For them the copper is already a “sunk cost”, so an FTTN rollout is a value add.

    For Malcolms NBN Co, the copper will be an up front cost, a cost likely to push Malcolm’s costs over the Labor plans cost. I also suspect this is why he is moving before the CBA is actually released, if it is actually “independent”, it may well contain some very bad news for Malcolm, and if it does, we’ll never actually get to read it.

    It really does boggle my mind that people actually fell for Malcolm’s fairy tale FTTN scheme…

  11. I was always very frustrated with Turnbull when he was opposition leader for the same reason. “Attack, Attack, Attack”

  12. …….. this latest BS from TurnBull just makes me soooooooooo Mad!!!!

    Where is the MSM reporting on the Lies and Hypocrscy of TurnBull??? It’s just so god damn blatant and, aside from a few decent Tech Journo’s, he is just spouting demonstrably false information and not being held to account!

    I think it’s pretty obvious to any rational thinking Australian who has even a passing interest in politics that we now live in a Murdochracy! This is why we cant have nice things like a real NBN!

  13. Isn’t politics amazing!

    Barry O’farrel resigns over failing to disclose a not very Good but still expensive bottle of wine (which prolly caused the memory failure) and yet i think most ppl would find TurBull’s rampant nbn cronyism and intentionally dodgy reviews far more corrupt than not declaring a bottle of wine!

  14. Triple J Hack interviewed Turnbull today – they had the wrong people asking questions. Attack Attack Attack

    • Not only that, they let TurnBull trot out several complete lies unchallenged – the two that pi$$ed me off the most were:

      1/ FTTP = $73 Billion when even his fraudulent SR says it’s $56 Billion

      2/ Labor chose FTTP out of ideology when the fact is Labor took FTTN to the 2007 election and switched to FTTP on advice from a truly independent panel of experts (as opposed to a bunch of cronies) who realised getting access to Telstra’s CAN would be cost prohibitive.

    • And we fall further into the rabbit hole, a Liberal appointment calling for new taxes…

  15. I’d like to make a suggestion for future articles discussing Malcolm’s decisions. Extrapolate on his past performance, anytime he fails to obfuscate or avoid an issue, he goes on a personal attack. I suggest simply including a prediction of his likely response as part of the article. His responses never have any actual content, so a prediciton of likely comment is more than sufficient. We can all then avoid wasting time with his avoidance or vitriol.

    Further, I would like to see an article on the internet throughout the world, in particular focusing on China, Egypt and anywhere else it has been significantly controlled or censured.
    Despite our poor opinion of him, Malcolm Turnbull is no fool. It is impossible that he is unaware of issues affecting our broadband alternatives, and it beggars belief that he continues to propose wasting money on an obsolete model. If we ever see the 2013 blue book for communications surface, likely in a future Royal Commission, I suspect we may well see just how many facts have been deliberately misstated.
    So the question that occurs to me is why does the Liberal government so vehemently oppose decent internet infrastructure in Australia, and how does it threaten their government and their supporters. I wish to believe it isn’t all about Murdoch’s media and payoffs, that is rather simplistic even given the prejudice shown by the press. I actually suspect the internet is an even greater threat to bad governments than any firearms issues. (USA, Second amendment “right to bear arms is the last defence against tyranny”) National access allows national debate, and even threatens the possibility of direct voter interaction for every significant political decision. Naturally such a thing would require a far better politically educated voter, but with ubiquitous internet that would become possible. In the worst case scenario for incumbent and opposing governments, we may even end up with a democracy!!!

    • I agree, and in support of your comment note that, as I see it, the only institutional resistence to fibre is the potential for information to rise up unhindered from the private citizenry. To be in control of information is to be in control of practically everything.

      TV is perfectly safe, being one way. The internet is dangerous, as information can come from other sources. Fast internet would be ruinous! It must be stopped!

      Therefore, Fibre-To-The-Private-Premises has come under continual, supported-by-MSM attack. It’s why Turnbull is allowed to slash and burn, unhindered, and Labor is, dare I say it, held back.

  16. “This shows that our critics are still stuck in a Labor government mindset of technology choices being made politically, if not ideologically.”

    Or put another way:

    “Black is white, the sky is purple, and only rusted on Laborites and Conrovians would think otherwise.”

  17. You’re missing the big picture, Renai.

    The real problem is that poor Malc doesn’t want to be doing this job at all. He wants to be Prime Minister. Thinks he *should* be Prime Minister, in fact.

    And in any fair world, he would be. Sadly though, while Leader of the Opposition, he supported Kevin Rudd’s Carbon Emissions Scheme, which marked him out as a Liberal with half a dozen brain cells – five more than his party’s normal prerequisite. Fed up with making the rest of them look *really* stupid like that, the Liberals knifed him. And just to make sure that their self esteem would never suffer in that same way again, replaced him with a borderline retard.

    Malc’s reaction? Why, what any normal member of the “grown ups” party would be: he spat his dummy. Big time. He said he’d serve out his current term as Earl of Wentworth, but would not seek re-election thereafter.

    Time passes…

    Malc has a change of heart, and in 2010 is re-elected, after all.

    Why bother? To spend the rest of his political career kissing the arse of a man that he clearly despises? Don’t think so. He’s about as happy a Vegemite as Communications Minister as Rudd was as Julia Gillard’s Foreign Minister.

    So try this on for size: Malc’s really waiting for the big job to come up again, as it most assuredly will. After all, there’s only so long that you can stand a gibbon up in a suit before the people say “that’s no Prime Minister – it’s just a gibbon that you’ve dressed up in a suit!”

    How best for Malc to achieve his goal though? Why, by fucking up every aspect of his current portfolio, of course! Let chaos reign and wait for their poll numbers to drop through the floor. Same goes to Joe Hockey raising the retirement age to 70 years old. Totally insane, you see? And when the polls drop, you know who gets the chop, the man at the top! (Wow, that even rhymed.) Another Liberal spill flushes Abbott away. Malc and Joe give us all their “mad Tony made us do it, and we’ll be normal from now on, honestly” speech, then get to duke it out for the Prime Ministership that, in their minds, should have been theirs all along.

    Sounds like a bonkers theory, I know, but you have to admit, it does fit the facts!

    • “Sadly though, while Leader of the Opposition, he supported Kevin Rudd’s Carbon Emissions Scheme”

      Which, sadly to say, marked the end of bi-partisan anything in Australia….

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