Chapter 1 Reporting on the Rollout of the National Broadband Network
Introduction
1.1
On 7 April 2009, the Australian Government (the Government) announced
the establishment of NBN Co. Limited (NBN Co) to ‘design, build and operate a
new super-fast National Broadband Network’ (NBN). The NBN would service all
premises across Australia and more broadly, would help drive national
‘productivity, improve education and health service delivery and connect...
cities and regional centres, enhancing ... Australia’s international
competitiveness.’[1]
1.2
The Government intended that the NBN would be built through a joint
partnership arrangement with the private sector with an investment of up to $43
billion over an 8 year construction period. The Government’s investment in the
NBN would be funded through the ‘Building Australia Fund’ and the issuance of
‘Aussie Infrastructure Bonds’ to the general public.[2]
The Government stated that it expected to divest its interest in NBN Co within
five years of the completion and operation of the NBN.[3]
1.3
On 20 December 2010, the Government estimated the total capital
expenditure of the NBN at $35.9 billion with the Government expected to
contribute $27.5 billion in rollout equity.[4]
1.4
The Government’s 2009 NBN policy and subsequent creation of NBN Co was
intended as a micro economic reform measure for the Australian
telecommunications sector with the required separation ‘between the
infrastructure provider and retail service provider.’ In 2009, the Government
stated that the structural separation nature of the reform would mean ‘better
and fairer infrastructure access for service providers, greater retail
competition, and better services for families and businesses.’[5]
1.5
More specifically, the Government announced the NBN would:
- ‘connect [with 90 per
cent coverage] homes, schools and workplaces with Fibre-to-the-Premise (FTTP),
providing broadband services ... in urban and regional towns with speeds of up
to 100 Megabits per second (Mbps) - 100 times faster than those currently used
by most people – extending to towns with a population of around 1,000 or more
people’[6]
- use next generation
wireless and satellite technologies that will be able to deliver 12 Mbps or
more to’ remote and regional areas
- ‘provide fibre optic
transmission links connecting cities, major regional centres and rural towns
- be Australia’s first
national wholesale-only, open access broadband network
- be built and operated
on a commercial basis by a company established at arm’s length from Government involving
private sector investment
- be expected to be
rolled-out, simultaneously, in metropolitan, regional, and rural areas.’[7]
1.6
The Government’s announcement was made following advice it had sought
and received from an expert panel. The expert panel recommended investment in
‘optical fibre technology, supplemented by next generation wireless and
satellite technologies.’[8]
1.7
In its review of the types of rollout for the proposed superfast
broadband network, the Australian Competition and Consumer Commission (ACCC)
advised the use of FTTP technology over FTTN technology.[9]
1.8
To initiate the NBN policy, the Government:
- commissioned an
implementation study to determine operating arrangements, detailed network
design, methods to attract investment and provide procurement opportunities for
business
- fast-tracked
negotiations and arrangements to begin a FTTP and wireless network rollout in
Tasmania (which would commence in July 2009)
- commenced rollout of
fibre optic transmission links between cities, major regional centres and rural
towns to address ‘blackspots’
- took steps to
‘progress legislative changes’ to govern NBN Co and facilitate NBN rollout
including in new (or Greenfield) developments (from 1 July 2010)
- made an initial
investment of $4.7 billion in the NBN
- commenced
consultation on required amendment to the telecommunications regulatory regime.[10]
1.9
On 8 November 2010 as part of its obligations as a Government Business
Enterprise (GBE), NBN Co delivered its Corporate Plan 2011-2013 to its
Shareholder Ministers.[11] The Corporate Plan was
publicly released on 20 December 2010. The Corporate Plan details how NBN Co
will proceed with the design, construction, delivery and operation of the NBN
over the three year period from 1 July 2010 to 30 June 2013. In
addition to legislative requirements for reporting by GBEs, the Corporate Plan
was drafted in accordance with the Statement of Expectations (SoE) document
released by the Government on 20 December 2010.
1.10
The Government’s SoE provided an outline of the ‘Government’s policy
implementation objectives for the NBN’ as well as its 6 May 2010 response to
the NBN Implementation Study.[12]
1.11
The NBN Implementation Study was undertaken over a seven month period
and delivered to the Government on 5 March 2010. Broadly, the
Implementation Study ‘confirmed high-speed broadband for all Australians was
achievable and could be built on a financially viable basis, with affordable
prices for consumers.’[13]
1.12
The Implementation Study involved ‘comprehensive stakeholder
consultation with industry, vendors, consumer groups, the finance sector, and
international experience and trends.’ The Implementation Study made 84
recommendations in the areas of: technology, financing, ownership, policy
framework and market structure.’[14]
1.13
The Government’s response to the Implementation Study included
consideration of a number of issues highlighted through consultation as well as
factoring in three main events. These were the:
- ‘Financial Heads of
Agreement between NBN Co and Telstra
- commitments to
Regional Australia agreed with the Independent Members Mr Windsor MP and Mr
Oakeshott MP following the 2010 Federal election
- joint ACCC and NBN
Co consultation process on the number and location of the Points of
Interconnect (POI) to the NBN conducted in October and November 2010.’[15]
1.14
Further, on 25 November 2010, the Government introduced NBN legislation
into the Parliament and on 9 December 2010 issued its Fibre in New Developments
policy statement in response to findings in the Implementation Study.[16]
1.15
The Government’s changes to its expectations for the NBN in response to
the Implementation Study included:
- increasing the FTTP
coverage of the NBN by the end of the rollout period from 90 per cent of
premises to 93 per cent of premises
- requesting NBN Co to
‘build the wireless network that will deliver fixed wireless services,
delivering peak speeds of at least 12 Mbps to premises in the 94 to 97
percentile of premises.’
- an expectation of NBN
Co ‘to maximise the use of existing infrastructure where it is efficient and
economic to do so in the delivery of the fixed wireless network.’[17]
1.16
In March 2011, in response to ongoing concerns raised in the Parliament
over the significant economic and time-intensive investment in the NBN, the
Parliament established the Joint Committee on the National Broadband Network to
enable the ongoing parliamentary scrutiny of all aspects relating to the
rollout of the NBN.
Establishment and Role of the Committee
Background
1.17
A motion to establish a Joint Select Committee on Broadband to inquire
into and report on the NBN was introduced by the Federal Opposition into the
House of Representatives on 25 October 2010.
1.18
The motion would enable a ‘Joint Select Committee on Broadband [to ’be
appointed to inquire into and report on all aspects of the business of the NBN
Co including its construction, operations, financing and any other matters
related thereto.’
1.19
Establishment of the proposed joint select committee was intended to
enable ongoing parliamentary scrutiny and oversight of the NBN and NBN Co. The
proposed joint select committee would consist of four members from each major
party represented in the Parliament with two crossbench members from the House
of Representatives and the Senate respectively. On 25 November 2010, the motion
was negatived.
1.20
On 22 November 2010, to facilitate the passage of the Telecommunications
Legislation Amendment (Competition and Consumer Safeguards) through the Senate,
the Prime Minister agreed on a package of measures with Senator Xenophon and
later confirmed this agreement through correspondence of 23 November 2010 which
was tabled in the Senate (see Appendix C).
1.21
Through this agreement, the Government committed to establishing a Joint
Committee on the National Broadband Network, which would report to the
Parliament on the rollout of the NBN on a six-monthly basis until the
completion of the project.
1.22
The proposed NBN committee would also be empowered to ‘report against
the final business plan, assess risk management processes and look at other
matters the committee determines are relevant to its deliberations.’ The
composition of the proposed committee was to mirror that of the Joint Committee
on Public Accounts and Audit with commencement from 1 July 2011, drawing
on ‘any relevant material from the Standing Committee on Infrastructure and
Communications’ (which is due to report to the Parliament by August 2011).
1.23
In addition, the proposed committee would be able to call witnesses
including Members and Senators to appear before it in relation to ‘performance
of the NBN or other matters of local interest.’
1.24
The Prime Minister also confirmed that NBN Co, the ACCC, the
Productivity Commission (PC) and the Australian Communications and Media
Authority (ACMA) would be able to appear before or contribute advice to the
committee. Further, the Prime Minister stated that the Government would write
to the ACCC and the PC to advise of the arrangements. At this early stage, the
committee has met with or taken evidence from each of these bodies, with the
exception of the ACMA.
1.25
On 1 March 2011, the Government introduced a motion to establish the
Joint Committee on the National Broadband Network. On debate of the motion in
the House of Representatives, the opposition requested adequate resources to
enable scrutiny of the NBN and also requested that the committee commence meeting
without delay. These terms were subsequently agreed to by the Government.
1.26
The composition and general rules relevant for the committee’s operations
are provided for in its resolution of appointment including the appointment of
an independent, non aligned member of the committee as the chair and the
appointment of participating members. In reference to the committee’s
composition, its resolution of appointment provides for the appointment of 16
members to the committee and states:
...that the Committee consist of 16
members, 4 Members of the House of Representatives to be nominated by the
Government Whip or Whips, 4 Members of the House of Representatives to be
nominated by the Opposition Whip or Whips, and one non-aligned Member, 3
Senators to be nominated by the Leader of the Government in the Senate, 3
Senators to be nominated by the Leader of the Opposition in the Senate, and one
Senator to be nominated by any minority group or groups or independent Senator
or independent Senators
1.27
Prior to its first meeting, there were 51 participating members[18]
appointed to the committee. With the recent end to the terms of a number of
Senators, and the appointment of two participating members from the House of
Representatives, the number of participating members is 41, with total
committee membership of 57.
1.28
With respect to the committee’s resolution of appointment, while
participating members ‘may participate in hearings of evidence and
deliberations of the Committee, and have all the rights of a member of the Committee,
[they] may not vote on any questions before the Committee’.
Role
1.29
The Joint Committee on the National Broadband Network (the committee) is
a new committee[19] and was established by a
resolution of appointment passed by the House of Representatives on 1 March
2011 and by the Senate on 3 March 2011.
1.30
The committee was appointed to inquire into and report on the rollout of
the NBN which includes the Government’s objectives for NBN Co to:
- ‘connect 93 per cent
of Australian homes, schools and businesses with fibre-to-the-premises
technology providing broadband speeds of up to 100 Mbps, with a minimum fibre
coverage obligation of 90 per cent of Australian premises;
- service all remaining
premises by a combination of next-generation fixed wireless and satellite
technologies providing peak speeds of at least 12 Mbps;
- The achievement of
take-up targets (including premises passed and covered and services activated)
as set out in NBN Co’s Corporate Plan (released on 20 December 2010 as
revised from time to time);
- Network rollout
performance including service levels and faults;
- The effectiveness of
NBN Co in meeting its obligations as set out in its Stakeholder Charter;
- NBN Co’s strategy for
engaging with consumers and handling complaints; and
- NBN Co’s risk
management processes.’[20]
1.31
The committee is also empowered to inquire into and report on ‘any other
matter pertaining to the NBN rollout that the committee considers relevant.’
1.32
Prior to the release of its first report, the committee inquired into
and reported on the Communications Legislation Amendment (Fibre Deployment)
Bill 2011.[21]
1.33
To date the committee has sought and received information about various
aspects of the rollout of the NBN including the:
- fibre in new
developments policy and related competition issues[22]
- the process that led
to the awarding of major NBN construction contracts to Silcar and Fujitsu
- broad scope of the
Definitive Binding Agreements between NBN Co and Telstra and NBN Co and Optus
- regional and remote
issues relating to the installation, timeframe and use of the NBN
- competition issues
associated with operation of the NBN including:
- the
decision based on advice from the ACCC to increase the number of POIs from 14
to 121 and
- uniform
wholesale pricing of the NBN to Retail Service Providers (RSP).
- technology innovation
and the impact on the price of access to the NBN
- skilled labour force
recruitment, demand and supply.
Previous Inquiries into the National Broadband Network
1.34
The committee’s first inquiry relating to the NBN was conducted in
reference to the proposed Telecommunications Legislation Amendment (Fibre
Deployment) Bill 2011 (Fibre Deployment Bill). The committee reported on the
proposed Bill on 5 July 2011. Through its inquiry, the committee reported
on the proposed legislation, but also issues surrounding the Government’s
policy of Fibre in New Developments.
1.35
This inquiry followed an inquiry by the Senate Environment,
Communications and the Arts Legislation Committee in 2010 on an earlier version
of the same proposed legislation. The Senate committee presented its report to
the Parliament in May 2010. The proposed Bill elapsed when the 42nd
Parliament was prorogued and an updated version of the Bill presented early in
the 43rd Parliament.
1.36
In addition to the committee’s recent advisory report on the Fibre
Deployment Bill, the NBN has been examined through a number of parliamentary
inquiries and reviews including the: Senate Select Committee on the National
Broadband Network, Senate Environment and Communications Legislation Committee
(and its predecessor committee), and the Senate’s Estimates process.
1.37
Since 2008 Senate committees have examined proposed NBN and NBN Co
related legislation.[23]
1.38
The inquiry into the Role and Potential of the NBN by the House of
Representatives Standing Committee on Infrastructure and Communications was
referred on 16 November 2010. The House Infrastructure and Communications
Committee is expected to report to the Parliament by August 2011.
Reporting Timeframe
1.39
The committee’s resolution of appointment provides that ‘until the NBN
is complete and operational’, the committee is to report on a six monthly basis
to both Houses of Parliament and its shareholder Ministers.[24]
The committee’s first reporting period ends on 31 August 2011.
1.40
The committee’s first report includes the six month review period from
its establishment in early March 2011 to its reporting date by end 31 August
2011.
1.41
Due to the delay in the reaching of a Definitive Binding Agreement
between NBN Co and Telstra, a review of this matter will be included in a
future report. The timeframe for the completion of the Agreement between NBN Co
and Telstra is expected in mid to late October 2011 pending a review by the
ACCC and endorsement of the terms of the Agreement by Telstra shareholders.
1.42
The committee is intends to present its second report on the rollout of
the NBN to the Parliament by the end of 2011. In so doing, the committee
proposes to adjust its reporting timeframe to June/December instead of the
August/February timetable that currently exists.
Review of National Broadband Network Rollout Progress
Background
1.43
The Government’s SoE for NBN Co in terms of planning, reporting and
performance management in line with its obligations as a GBE.
1.44
In reference to planning, reporting and performance management to the
Government, NBN Co is expected to:
- regularly report
(including an annual report and interim reports) to the Government to enable NBN
Co performance to be measured
- the
annual report is to include details regarding the network rollout performance
and cost, achievement of service levels, faults, customer complaints, details
of its progress towards meeting its coverage objectives and expenditure incurred
in doing so, as well as other matters as advised by the Shareholder Ministers
- in consultation with
the Government, develop Key Performance Indicators (KPIs) to monitor progress
against the NBN Co Corporate Plan and Business Plan
- continue to report to
the Parliament and its committees (with particular reference to this committee)
- develop a
comprehensive strategy (and regularly report against this strategy to
Government) for engaging with individual consumers (including handling
complaints) during the NBN rollout
- ‘continue to conduct
its planning and the execution of its strategy in a publicly transparent manner
subject to any requirements for commercial confidentiality, and reflect this in
its annual reporting.’[25]
1.45
Early after its establishment, the committee asked NBN Co (and where
relevant, the Government through DBCDE) to report regularly to the committee to
enable it in turn to report to the Parliament and portfolio Ministers as
required on the rollout of the NBN.
1.46
As the committee was aware that similar reporting information was to be
prepared for the Government, NBN Co and the DBCDE were asked to provide a
version of a report to the committee, so as not to duplicate reporting
mechanisms. The committee proposed to consider the format and information
contained within the first report and to comment on whether the material met
its needs. To date, no such report has been provided.
1.47
In response to honouring the committee’s request for regular reports
against KPIs and NBN Co rollout of the NBN targets, the Shareholder Ministers
wrote to the committee in early July 2011 to advise of reporting arrangements
on the NBN rollout. (see Appendix D)
1.48
However, this report would not be made available to the committee before
mid September 2011[26] which would be after the
committee’s required first reporting date to the Parliament.[27]
1.49
The unsatisfactory consequence of this delay is that in this, the first
report of the committee appointed to oversee the construction of the NBN, the
committee is unable to provide Parliament with the most up to date information
about the progress of the construction, the rate of connection not speak of the
amount of capital drawn down and expended by the NBN Co.
1.50
The Government stated that the report could not be made available to the
committee earlier as more time was required to:
...enable NBN Co management to prepare a report of
satisfactory quality, for the NBN Co Board to perform appropriate due diligence
in reviewing the content of the report, and for initial Government consideration
of the report. This timing would also ensure that the Government is able to
provide the Committee with relevant information surrounding recent developments
as part of its first report.[28]
Key Performance Indicators and Reporting Intervals
NBN Co Targets
1.51
The NBN Co Corporate Plan lists a ‘number of specific high level
deployment targets to be achieved by 30 June 2013.’[29]
1.52
These targets are stated as incremental year-on-year figures for June
2011, 2012 and 2013 for two broad NBN rollout categories. These categories are:
- premises Passed or Covered
- premises with Active
Service.[30]
1.53
These two categories are further reported against in three
classifications for type of service which are:
- FTTP
- satellite first
release
- wireless.[31]
1.54
The NBN Co Corporate Plan states that the targets are indicative only as
the NBN rollout is dependent on:
- ‘the availability of
exchange facilities for the location of the semi-distributed POIs
- negotiations yet to
finalise on commercially attractive terms the procurement of Greenfields Build-Operate-Transfer
(BOT)
- securing contracts
with suppliers and construction contractors on competitive terms and
conditions.’[32]
1.55
The FTTP service is reported on in Brownfields, Greenfields build and
Greenfields BOT.
1.56
At the committee’s 5 July 2011 public hearing, in reference to the
targets outlined in its Corporate Plan, NBN Co provided figures on premises
passed in Brownfields (existing premises) by end June 2011, number of premises
served through the interim satellite service by end June 2011 and Greenfields
lots passed by end June 2011.The NBN Co provided information that it had
exceeded its targets for Brownfields and satellite for end June 2011, but due
to the ongoing policy debate on Greenfields, there had been delay in this area.
The NBN Co stated:
... [In] our Corporate Plan that we submitted last December,
we had projected that we would have passed 13,000 Brownfields premises by the
end of June... . I am pleased to report that, as of the end of June, we have
passed 14 256 premises. We had also anticipated launching our interim satellite
service by 30 June. We did so on 1 July. We had anticipated that the interim satellite
service would cover 165 000 eligible premises; that was our estimate at the
time. Our latest estimate is, in fact, somewhat more than that: we expect that
it will be above 200,000 eligible premises that that interim satellite service
will cover. We had also anticipated prior to December of last year that there
would be some 45 000 Greenfields lots that would need to be passed, but, as
everybody in the room probably knows, there has been ongoing policy debate
about the Greenfields—the new developments. In fact, that policy has been
particularly around the responsibility of Telstra and NBN Co, and it has taken
some time to resolve that.[33]
Development of Key Performance Indicators
1.57
At the committee’s 16 May 2011 public hearing, NBN Co stated that it was
reviewing ‘a number of KPIs with the NBN Co Board.’[34]
1.58
Later at the committee’s 5 July 2011 public hearing, the NBN Co
indicated that it had been working closely with the Government to develop KPIs.
The NBN Co stated that once this process was complete, that the Government
would consult with the committee to determine which KPIs it would seek figures
on. The NBN Co stated:
We have been working closely with the Government on a range
of KPIs. My understanding is that the instructions to us from the Government
are that when that is established the Government will liaise with the committee
to find which of those KPIs you would be interested in seeing.[35]
1.59
In its letter of 7 July 2011 in reference to reporting arrangements for
the rollout of the NBN, the Government stated that NBN Co is in the process of
finalising ‘an appropriate reporting framework including KPIs on NBN Co’s
activities which can be used as the basis for reports to both the Government
and the committee.’[36]
Objectives and Scope of the Review
1.60
In undertaking its first six-monthly review of the rollout of the NBN,
the committee primarily sought relevant information from NBN Co, the DBCDE and
the Department of Finance and Deregulation. The committee also received
submissions from interested individuals and organisations.
1.61
In addition, as the Government’s SoE provides that the timeframe for the
introduction of wireless and satellite services will be brought forward,[37]
the committee undertook to receive evidence from a regional area. The committee
selected Broken Hill to enable it to receive evidence on regional issues
pertaining to the rollout of the NBN as Broken Hill is yet to receive NBN
services, but is a site through which the Regional Backbone Blackspots network[38]
runs.
1.62
During the course of its review, a Binding Definitive Agreement was
signed between NBN Co and Telstra with three main components. These are:
- ‘it grants NBN Co
access to Telstra facilities and infrastructure over a minimum period of 35
years, ensuring that the fibre optic component of the National Broadband
Network, serving 93 per cent of premises, can be rolled out efficiently and
avoids duplicating infrastructure
- it provides for the progressive
disconnection of Telstra’s copper and Hybrid Fibre Coaxial (HFC) customers
(other than HFC pay-TV customers) and NBN Co will be Telstra’s preferred
fixed-line network
- in addition, NBN Co
and Telstra have negotiated interim arrangements for immediate access to
Telstra infrastructure.’[39]
1.63
The agreement requires examination by the ACCC and ratification by
Telstra shareholders before it comes into force.
1.64
The committee intends to continue its examination of the Telstra Agreement
in more detail once the Agreement has been completed.
1.65
As part of the review, the committee also intended to examine KPIs and
performance measures relevant to the rollout and subsequent initial operation
of the NBN. However, the committee is still awaiting receipt of this statistical
information and so it will not be able to report on the performance of the
rollout of the NBN as required under its resolution of appointment.
1.66
In addition, the committee has reported on the timeliness and inquiry
challenges presented to the committee during its first review period.
1.67
The committee has also included within the scope of its first review,
important regional issues in relation to the rollout of the NBN as raised by
the Broken Hill and surrounding communities and Julia Creek. These issues include
technology innovation to enable enhanced remote service delivery and improved
opportunities for economic development.
1.68
Competition issues were also raised as part of the committee’s Inquiry
into the Telecommunications Legislation Amendment (Fibre Deployment) Bill 2011.
Potential competition generated by the rollout and operation of the NBN and the
impact on existing competition in the telecommunications market was raised as
an issue during the review. Competition issues have been prevalent throughout
this review and will continue to be examined in the committee’s next reporting
period.
Conduct of the Review
1.69
The committee issued a media release on 9 May 2011 announcing its
establishment and role in the ongoing six-monthly review of the rollout of the
NBN. The committee also wrote to inform and invite individuals and
organisations to participate in the review by providing submissions or
appearing before the committee at public hearing. The invitation to receive
submissions closed on 8 August 2011.
1.70
The 21 submissions and 11 exhibits received in relation to the review
are listed at Appendix A.
1.71
The committee held four public hearings as listed. Each of the public
hearings held were announced and publicised through the issue of media
releases.
|
Date
|
Venue and Place
|
|
16 May 2011
|
Parliament House, Sydney
|
|
5 July 2011
|
Parliament House, Canberra
|
|
27 July 2011
|
Trades Hall, Broken Hill
|
|
28 July 2011
|
Parliament House, Melbourne
|
1.72
The committee also conducted two infrastructure inspections in Broken
Hill and Melbourne on 27 and 28 July 2011. Sites visited by the
committee are listed.
|
Date and place
|
Infrastructure inspection sites
|
|
27 July 2011
Broken Hill, NSW
|
- Regional Backbone Blackspots Program - Controlled Environment
Vault facility
- Backbone Point of Interconnect Site, corner of Blende and
Chloride Streets
- Broken Hill Film Studio
|
|
28 July 2011
Melbourne, Vic
|
- Brunswick Fibre Access Node (previously a Telstra Exchange)
- Pit and Fibre Distribution Hub and lead-in to premises
|
1.73
Witnesses who appeared before the committee and gave evidence to the
review are listed at Appendix B. Transcripts of the public hearings are
available at www.aph.gov.au/jcnbn.
Report Outline
1.74
Chapter 1 outlines the main areas of review of the progress of the
rollout of the NBN including: reporting intervals and key performance measures
and indicators. Discussion on the methods of obtaining timely and relevant
information is included.
1.75
Chapter 2 provides an overview of the components of the NBN and includes
discussion about competition issues and issues associated with the benefits and
challenges of access to the NBN in regional and remote areas.
Concluding Comments
Review of National Broadband Rollout Progress
1.76
The Government’s Statement of Expectations (SoE) provides clarity and
guidance to the NBN Co Limited (NBN Co) on how it should proceed with and
report on rollout of the National Broadband Network (NBN). In particular, in
regard to reporting on NBN targets and Key Performance Indicators (KPIs), the
committee expected the KPIs and performance measures to be resolved between the
NBN Co, the Department of Broadband, Communications and the Digital Economy
(DBCDE) and the committee as a matter of priority.
1.77
Recent correspondence from the Shareholder Ministers has informed the
committee that it will not receive its first report on progress of the rollout
of the NBN until mid September 2011.
1.78
At the earliest, the DBCDE and the NBN Co were aware of the committee’s
terms of reference and its August reporting date at its establishment in March
2011 and could have anticipated the committee’s requirements in terms of
reporting on NBN data. In addition, the committee made repeated requests for
data on NBN rollout KPIs and performance measures.
1.79
As the committee has not received a report on the relevant NBN rollout KPIs
and performance measures, the committee cannot report on this data as required
under its resolution of appointment.
1.80
In terms of the timing of receiving NBN rollout performance information
and KPIs, the committee will seek an amendment to its resolution of appointment
to allow it to report to the Parliament biannually in June and December. This
would allow for the NBN Co and the DBCDE to prepare reports for the committee
in line with more streamlined reporting timeframes and current public sector
practice. This timeframe would also enable more thorough examination of NBN
rollout issues by the committee. The committee proposes to write to portfolio
Ministers to obtain their concurrence to the new arrangements.
1.81
The committee would also see a benefit in receiving NBN rollout
performance information on a quarterly basis, in line with its expected
June/December reporting timetable, so that short-term and long-term trends may
be easily identified, examined and possibly benchmarked.
Telstra Agreement
1.82
The committee notes that there have been delays in the negotiating of
the Definitive Binding Agreement between NBN Co and Telstra, and that the Binding
Definitive Agreement between NBN Co and Optus required time and effort to reach
and was not factored into the current NBN Co Corporate Plan.
1.83
The committee understands the Binding Definitive Agreement between NBN
Co and Telstra requires review by the ACCC and endorsement by Telstra
shareholders, and notes that this should be finalised by mid to end October
2011.
1.84
The committee is interested in having the opportunity to examine in more
detail, the Binding Definitive Agreement between NBN Co and Telstra.
Timeframe for Receiving Answers to Questions Taken on Notice
1.85
Since its establishment, the committee has held five public hearings
covering two inquiries. Given the high importance placed on the matters under
consideration by the committee and the tight reporting timeframes, the
committee is reliant on the evidence it receives from the NBN Co and the DBCDE.
This includes formal evidence received by the committee at hearing, through
written submissions and in answers to questions taken on notice.
1.86
On a number of occasions during the committee’s hearings, witnesses from
the NBN Co and the DBCDE have taken questions on notice and been provided with
a timeframe in which the answers should be provided to the committee.
1.87
The majority of answers to questions taken on notice were received by
the committee well outside of the notified timeframe. In addition to appearing
before this committee, NBN Co and the DBCDE are required to appear before
Estimates Committees. The committee acknowledges the timeframes for preparing responses
to questions taken on notice for this committee and for Estimates hearings has
created an additional reporting burden for these agencies.
1.88
However, the committee is of the view that adherence to timeframes for
receiving answers to questions on notice allows the committee to include
relevant formal evidence to be included in the committee’s report deliberations
and often provides useful evidence, further informing the committee’s findings
and recommendations. This is especially important in reference to the
committee’s ongoing reviews in consideration of the significant investment in
the NBN project.
1.89
The committee strongly urges NBN Co and the DBCDE to give their responses
to answers to questions taken on notice greater priority. This will assist the
committee to undertake its role as intended by the Parliament.
Commercial-in-Confidence
1.90
In addition, the NBN Co has on a number of occasions not provided
information to the committee or failed to answer questions on
commercial-in-confidence grounds, limiting the committee’s scope in its inquiry
of matters that is within its remit.
1.91
The Government’s SoE encourages NBN Co to continue to conduct its
planning and execution of its strategy in a publicly transparent manner,
subject to commercial-in-confidence requirements.
1.92
However, the committee draws to the attention of the NBN Co the Senate
resolution of 30 October 2003 which requires any claim for
commercial-in-confidence to be made by a Minister accompanied by a ministerial
statement of the basis of the claim, including a statement of the commercial
harm which may result from the disclosure of the information.
1.93
In reference to a statutory authority, the Senate resolution states if a
committee is satisfied that a statutory authority has such a degree of
independence from ministerial direction that it would be inappropriate to have
a minister make the claim the committee may receive the claim from officers of
the authority.
1.94
The committee notes that there are avenues available to deal with
commercial-in-confidence material including taking evidence ‘in-camera’ – although
the committee is generally unable to use such material in its public reports.
1.95
The committee will continue to monitor claims of
commercial-in-confidence and may seek to press the issue if it believes its
mandate from the Parliament and the Government is being unduly impeded by such
claims without satisfactory explanation.
Recommendation 1 |
| 1.96 |
The committee recommends that the NBN Co together with the
Department of Broadband, Communications and the Digital Economy, commencing
for the first quarter 2011-2012, provide a six-monthly report on the progress
of the rollout of the National Broadband Network, using established Key
Performance Indicators and performance measures, no later than three months
before the committee is due to report to the Parliament. |