Since the Turnbull Government recently broke yet another election promise and announced that taxpayers would bail out their second-rate National Broadband Network to the tune of $19.5 billion, the responsible Ministers have worked themselves into a real lather.
Prime Minister Turnbull likes to claim that under his stewardship, the NBN is “one of the biggest corporate turnarounds in Australian history.”
He doesn’t like to let the facts get in the way of reality. It turns out that the only thing that has turned around is his Government doing a massive backflip on its iron-clad commitment for NBN Co to raise private debt to support the remainder of the rollout.
Now, NBN Co is set to instead receive $19.5 billion in taxpayer funding. Last week in Parliament, both Finance Minister Mathias Cormann and Communications Minister Mitch Fifield tried in vain to deny their Government’s clear broken promise on this new funding arrangement.
This decision substantially increases the Commonwealth’s financial exposure on the NBN compared to its previously stated position.
It flies in the face of everything this Government has been promising for three years. As recently as May 2016, under questioning at Senate Estimates when asked if the Government was leaving open the possibility of providing more funding for the NBN, the Finance Minister replied:
“No. The equity cap that is in place is $29.5 billion, and our planning is for NBN to source the remaining funding requirements by raising debt from external markets. We have outlined that very clearly. We believe and are confident that that will be able to be achieved.”
Only a few days later when asked about the rollout cost, the Communications Minister backed him up, stating:
“Well, the Commonwealth has indicated that our cap on equity contributions will be $29.5 billion. NBN will have to borrow money beyond that, but $29.5 billion is the Commonwealth cap.”
The Ministers, and the Prime Minister, have tried desperately to distract attention from their clear backflip by talking about the difference between ‘equity’ and a ‘loan’. Fortunately, Australians can compare their actions to their promises by simply looking at the Prime Minister’s own website.
No amount of mansplaining can fix this monumental stuff-up.
Indeed, the Communications Minister recently opted for silence in Senate Estimates when asked to explain the risk arising from this new funding arrangement. Their excuse for this latest broken promise seems to be that they had a unique insight only after the election that NBN could borrow money from government at a cheaper rate than from the private sector.
Well, this has been a fact since 1901! And since the Government has certainly known this fact since 2013, what has changed since then? All they’ve done is promise one thing before the election and done the opposite after it.
The Government should just come clean and admit that markets have rebuked their second-rate copper NBN. After several questions in both houses of Parliament last week and in a Senate Estimates hearing on Friday, Australians are none the wiser on some key questions surrounding this funding backflip:
• What was the credit rating received by NBN Co?
• What did NBN Co recommend to Government after receiving its credit rating?
• Was the Government advised that private lenders were lacking confidence in the Coalition’s second-rate NBN and the long term liability of relying on copper?
• What position did Finance and Treasury recommend to Cabinet?
• Which Ministers recommended giving NBN Co a loan – and who was opposed?
All this came at the end of a week that clearly demonstrated what Australians really think of their NBN experience under this government. The Telecommunications Industry Ombudsman (TIO) recently revealed that complaints about the NBN have increased by almost 150%. The vast majority of the postcodes that recorded the most complaints have been relegated to Malcolm Turnbull’s flawed copper-based fibre-to-the-node technology.
This is no surprise. I, and my Labor colleagues, regularly deal with complaints about this government’s NBN. Far too many Australians are enduring unacceptable connection and fault delays, slow data speeds, unusable services and drop-outs.
Frustratingly, consumers are getting passed back and forth between NBN Co and their service provider when something goes wrong. They are simply fed up.
Every day also brings the Government closer to a key NBN milestone they have no chance of fulfilling. In 2013, they promised every Australian household would have access to NBN by the end of 2016. With the clock ticking, they’ll end up being over 7 million premises short.
Malcolm Turnbull has utterly failed on every single promise he made on the NBN. Faster, sooner, more affordable? Fail, fail, fail. The cost of his fraudband network has blown out from $29.5 billion to $54 billion.
Only Labor understands the drivers of innovation are a strong education system and a culture of creativity, backed by world-class broadband infrastructure. It’s this kind of vision that is sorely lacking from the current lacklustre Communications Minister and the Turnbull Government.
Michelle Rowland MP is the Shadow Minister for Communications. This article first appeared in Telecom Times on SUNDAY, 28 NOVEMBER 2016.