ALP Senators' Report
EXECUTIVE SUMMARY
THE
UNIVERSAL SERVICE OBLIGATION
- Labor Senators acknowledge the fundamental importance of the
Universal Service Obligation in ensuring the delivery of minimum
telecommunications services to rural and regional Australia.
-
Labor Senators condemn the Government for its continuing push for
the full privatisation of Telstra, a policy which will inevitably see a decline
in services to rural and regional Australia.
- Labor Senators note that the Government has sought to portray
competitive tendering of the Universal Service Obligation as both the solution
to all the ills of the decline of services to rural and regional Australia
following on from the partial privatisation of Telstra, and as an argument to
pursue full privatisation.
- Labor Senators note the Government’s own admission of the
limitation of the scope of its competitive tendering policy by requiring
Telstra to remain as the safety net service provider of last resort in the two
proposed pilot project areas.
- Labor Senators believe that the Universal Service Obligation must
be upgraded in the future to encompass access to minimum digital data services,
and condemn the Government for continuing to ignore the growing need for
reliable data services for Australians in remote or isolated communities.
CALCULATING THE COST OF THE UNIVERSAL SERVICE OBLIGATION
-
Labor Senators believe that any Ministerial determination
regarding the calculation of the cost of providing the universal service
obligation, whether in full or in part, should be based on advice from the
Australian Communications Authority, and should be by way of disallowable
instrument.
EXTENDING LOCAL CALL ZONES TENDER
- Labor Senators do not believe that the successful tenderer for
the $150million extension of local call zones project should automatically
become the nominated Universal Service Provider for that area, particularly as
this goes further than the Government’s proposed competitive tendering pilot
projects.
- Labor Senators believe that any prospective universal service
tenderers be selected on the basis of clear, defined objective criteria,
expressed through legislation.
CARRIER INFORMATION PROVISIONS
- Labor Senators believe that the information framework should
reflect commercial sensitivities and address only the specific needs of an
incoming carrier in respect of carrying out specific obliged services or
functions.
- Labor Senators believe that the ACA, on approach from an affected
carrier, should be given the power to declare a request for information
unreasonable.
- Labor Senators believe that, consistent with freedom of
information principles, carriers should be able to recover the reasonable costs
of complying with a request for information.
INTRODUCTION
The Telecommunications (Customer Protection and Service Standards)
Amendment Bill No.1 2000 seeks to make a range of amendments to the
Telecommunications (Customer Protection and Service Standards) Act 1999, in the
following areas:
- Initial development of a framework for competitive tendering for
Universal Service Obligation services;
- A framework to issue a $150 million tender to extend local call
facilities to remote parts of Australia;
- Adjusts the mechanism used to calculate the cost of the Universal
Service Obligation, to enable the Minister to nominate a figure for three years
in advance.
These
proposed amendments flag the potential for significant change to the framework
for providing universal telecommunications services to all Australians,
regardless of where they live or work.
Labor
Senators acknowledge the fundamental importance of the Universal Service
Obligation in ensuring the delivery of minimum telecommunications services to
rural and regional Australia.
THE
UNIVERSAL SERVICE OBLIGATION
It
is the view of Labor Senators that the Government is not engaging in the
process of possible reform of the Universal Service Obligation with clean
hands.
Service
levels, particularly in rural and regional areas, have declined under the
partial privatisation of Telstra, and Labor Senators believe that the Government
has ignored these areas in its ideological obsession with the initial
privatisation and subsequent push for the full privatisation of Telstra.
Service
levels in some parts of Australia remain woefully inadequate, and it is the
view of Labor Senators that any change in the universal service obligations
arrangements must not be at the expense of genuine improvements in service
levels in those areas.
Labor Senators note that the Government has sought to
portray its proposed competitive tendering framework as the solution to all the
ills in the decline of rural and regional service delivery since the partial
privatisation of Telstra, and as an argument to pursue the full privatisation
of Telstra.
Labor Senators note the Government’s own acknowledgment of the
limitations in its approach, namely that:
- Firstly, its plan is limited to two pilot projects in undefined areas
the results of which will not be known for a number of years; and
- Secondly, its decision to require Telstra to remain as a safety net provider
of last resort in the areas to be covered by the pilot projects acknowledges
the unique role of Telstra in the delivery of services to rural and regional
Australia and therefore the folly of pursuing full privatisation.
Labor
Senators condemn the Government for its continuing push for the full
privatisation of Telstra, a policy which will inevitably see a decline in
services to rural and regional Australia.
There is little attention paid to the detail of how specific
service difficulties faced in USO serviced areas will be addressed by these
changes.
The high cost and limited availability of broadband or data
services represents a significant barrier to the use of the Internet and other
emerging digital services by rural, regional and remote communities.
Labor Senators believe that the Universal Service Obligation
must be upgraded in the future to encompass access to minimum digital data
services, and condemn the Government for ignoring the growing need for reliable
data services for Australians in remote or isolated communities.
CALCULATING THE COST OF THE USO
The Bill would allow the Minister to determine the Universal
Service Cost for up to three years in advance, generally based on estimates
provided by the Australian Communications Authority(ACA).
The issue of calculating the cost of providing the universal
service obligations has been debated for some time, as the cost is borne by
industry, by way of an ex post facto levy based on a calculation of cost
by proportion of market share.
In 1999, the ACA reviewed the framework for determining the
USO cost, in the wake of a $1.8billion claim for the cost by the Universal
Service Provider, Telstra.
These amendments complement legislation enacted by the
Parliament in 1999, in advance of an ACA review, which established a temporary
provision which allowed the Minister for Communications to make a determination
concerning the cost of providing the universal service for the years 1998-99,
2000-01, and 2001-02, for the purpose of providing industry certainty.
Concerns have been raised that the Bill reduces the role of
the ACA in developing and administering a methodology for the calculation and
collection of the Universal Service Obligation cost and levy, as the Bill
confers a power on the Minister to require the ACA to use a particular
methodology or formula for determining the cost.[1]
Labor Senators believe that any Ministerial determination
regarding the cost of providing the universal service obligation, whether in
full or in part, should be based on advice from the Australian Communications
Authority, and made by way of disallowable instrument.
LOCAL CALL ZONE TENDER
The Government has proposed to issue a $150million tender
for the supply of infrastructure to remote areas currently without an untimed
local call service.
Telstra raised in its submission the provisions of the Bill
which would see the successful bidder for the $150million automatically become
the nominated universal service provider (NUSP) for the area covered by the
tender[2],
thereby potentially relieving Telstra of any responsibilities in those areas.
This raises valid concerns that customers in such areas may
suffer the consequences if, for any reason, the tender project fails.
Labor Senators are concerned that the project goes further
than the two competitive tendering trial proposed in respect of the Universal
Service Obligation, in that this could replace Telstra as the universal service
provider in those areas.
Labor Senators do not believe that a successful tenderer for
the $150million extension of local call zones project should automatically
become the nominated universal service provider for that area, particularly as
this goes further than the Government’s competitive tendering proposals.
Concerns have also been raised about provisions in the Bill
which confer a power on the Minister for Communications to determine a
successful bidder for the $150million local call zone project[3].
The Bill states in proposed new sections 20(2A) and 26A(2A)
that, in making Universal Service Provider declarations, “the Minister is not
limited to considering only the person’s suitability to provide the services
that must be provided to fulfil the universal service obligation”[4],
without defining which other matters the Minister must consider.
This seems overly broad, and provides little guidance as to
what matters would be considered important in determining who provides a
universal service for a given area.
Labor Senators believe that any prospective universal
service tenderers be selected on the basis of clear, defined objective
criteria, expressed through legislation.
CARRIER INFORMATION PROPOSALS
The Bill would allow incoming universal service providers to
“require the former provider to give to the [incoming] provider specified
information...that will assist the [incoming] provider in doing something that
the [incoming] provider is or will be required to do by...this part”[5].
Concerns were raised with the Committee that the proposals
allow for unnecessarily broad access to an incumbent carrier’s information.
In particular, Telstra submitted that the provisions were
“objectionably wide”, because:
They are not limited to
information that is “required” to carry out an obligated service;
They do not limit what the
incoming carrier can do with the information;
They allow the Minister to
declare what information must be provided, but do not allow the Minister to
declare that certain information need not be provided;
They do not allow the Australian
Communications Authority to declare a request unreasonable;
They do not allow the former
provider to recover costs for the preparation and delivery of information.[6]
Other concerns raised include:
That the broad nature of the
information provisions increase the potential for ambit requests, designed
simply to seek commercial information;
That any determination by the
Minister should be by way of a disallowable instrument.[7]
Labor Senators believe that the information framework should
reflect the commercial sensitivities of the information that may be sought, and
address only the specific needs of an incoming carrier in respect of carrying
out specific obliged services or functions.
Labor Senators believe that the Australian Communications
Authority should be given the power, on appeal from affected carriers, to
declare a request for information unreasonable.
Labor Senators believe that, consistent with freedom of
information principles, carriers should be able to recover the reasonable costs
of complying with a request for information.
________________________________
SENATOR
MARK BISHOP
(A.L.P.,
W.A.)
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