Additional Comments by Labor Senators
The
Telecommunications Legislation Amendment (Regular Reviews and Other Measures)
Bill 2005 has been promoted by the Government as the means by which rural and
regional telecommunications services will be 'future proofed' after the sale of
Telstra.
Labor Senators
believe the Bill manifestly fails to achieve that objective.
Rather, it is part
of an ongoing effort by the Government to create the perception that it will
address service deficiencies in rural and regional Australia in an attempt to
garner community support for the full privatisation of Telstra.
Like the vast
majority of Australians, particularly those in rural regional areas, Labor
remains opposed to the further sale of Telstra as it will only lead to the deterioration
of service standards.
The principal
measures in the Bill facilitate the imposition of a local presence plan on
Telstra and establish a mechanism for regular reviews of the adequacy of
telecommunications services in rural and regional Australia.
Labor Senators do
not oppose these initiatives but believe that their limitations should be
acknowledged. The Bill only tweaks the edges of a telecommunications regulatory
regime that is fundamentally flawed.
Furthermore, it is
important to note that the provisions allowing the Minister to approve a local
presence plan do not guarantee any particular level of local presence by Telstra.
The Minister has
stated that the requirements of the local presence plan are being 'negotiated'
with Telstra.
Similarly while
reviews of services standards in rural and regional are worthwhile, the fact
remains that the mechanism established by the Bill does not commit the
Government to spend any money on improving services regardless of the level of
need identified by the Review.
In this respect the
Bill clearly fails to implement Recommendation 9.1 of the Estens Inquiry which
stated that the review process should be 'underpinned by ongoing arrangements
that provide a high degree of certainty that Government funds will be made
available to support service improvements in regional, rural and remote
Australia'.
Labor Senators
welcome the fact that the Chairs' report recognises a number of flaws in the
Bill. In particular, Labor Senators endorse Recommendations 1, 2, 4, 5 and 6 which
were supported by the overwhelming weight of evidence received during the
committee's inquiry.
Importantly, these
recommendations improve the transparency of the process of developing local
presence plans and reduce the period between reviews to a maximum of three
years.
However, Labor
Senators believe that the operation of the review process can be improved by
two further amendments.
Independence of members
Further amendments
are required to strengthen the independence of the review committee.
Currently the review
committee may include members of Telstra or its subsidiaries subject to the
restriction that they cannot constitute a majority of the committee.
The Chair's Recommendation
3, limiting carriers to one position, would improve the independence of the
review committee.
However, Labor
Senators do not believe that the committee would be seen as independent by the
community if it included an officer or employee of any carrier.
Carriers should of
course be able to provide support and advice to the review but there is no need
for them to have formal representation on the committee.
Scope of the review
Currently the Bill
provides that the RTIRC should examine the adequacy of the services in rural
and regional Australia.
Evidence presented
to the Committee highlighted the importance of the telecommunications sector to
Australia’s economic performance and made a case for regular reviews with a
broader outlook.
Labor Senators
believe that the Bill should be amended to expand the review committee’s terms
of reference to permit it to consider a wider range of matters.
The committee's
ambit should include a consideration of issues such as: whether
telecommunications services are meeting the social and commercial needs of the
Australian people; whether services are reasonably available throughout
Australia; and whether competition is operating effectively.
The adequacy of
rural and regional issues would no doubt still be a focus of the committee’s
work within this more expansive charter.
HiBIS
While the operation
of the Government's HiBIS scheme is strictly beyond the Committee's terms of
reference, the Chair's unqualified praise for this program in paragraph 2.12
cannot pass without comment.
Labor Senators
believe that HiBIS is a deeply flawed initiative.
Figures obtained
from the last round of Senate Estimates show that 64 per cent of the funding
that has been allocated to date under HiBIS has gone to Telstra.
Community telcos and
regional ISPs have the right to wonder why the government is subsidising the
already dominant Telstra, to the tune of almost $12 million so far, to compete
with them in regional areas.
Some smaller ISPs
are being locked out of HiBIS by the complex and bureaucratic nature of the
application process.
For example,
customers that are signed up after beginning the application process, but
before being accredited, are not eligible for the subsidy.
Another limitation
on the ability of new entrants to take advantage of HiBIS is their inability to
access backhaul services on reasonable terms under the access regime.
The Senate Inquiry
investigating the adequacy of the telecommunications regulatory regime has
heard much evidence that on the backhaul routes for which Telstra is the only
supplier, quoted prices for access are extraordinarily high.
The fact that the
majority of the money being allocated under HiBIS is being used to entrench
Telstra’s dominance in rural and regional areas should be a major issue for the
government.
Labor is also
concerned that the majority HiBIS money has been spent funding satellite
services that will not actually result in any new infrastructure for rural and
regional areas.
Labor Senators will
continue to pursue the flaws in the HiBIS program during forthcoming Estimates
hearings.
Recommendations
Labor Senators
support the Chair's recommendations 1, 2, 4, 5 and 6.
In addition, Labor
Senators believes that the Bill should be amended to:
- strengthen the
independence of the review committee by preventing officers or employees of
carriers or their subsidiaries from being members of the committee; and
- broaden the scope
of the review beyond rural and regional services to allow the committee to
examine matters such as whether telecommunications services are meeting the
social, industrial and commercial needs of the Australian people, whether
services are reasonably available throughout Australia and whether competition
is operating effectively.
Senator Kate Lundy
Australian Labor Party
Senator Stephen Conroy
Australian Labor Party
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