Committee splits, but says yes to Telstra reform

James Riley
Monday, 26 October 2009 16:07

IT Policy - Government Tech Policy

The Senate committee investigating controversial regulatory reforms in the telecommunications sector has recommended the legislation be passed without delay, but not before Coalition senators put forward substantial objections in a dissenting report.

"The committee believes that the bill in its current form provides important and timely reforms to Australia's telecommunications regulatory regime that will be of benefit to providers and consumers," the committee says in its concluding statement.

"The committee recommends that the bill should be passed."

The committee was investigating Telecommunications Legislation Amendment (Competition and Consumer Safeguards) Bill 2009, which, among other things, could lead to the functional separation of Telstra into retail and wholesale business, and makes sweeping changes to the Trade Practices Act in relations to telecommunications services.

While acknowledging that the issue of further consumer safeguards warranted further examination, the committee's majority view held that passage of the bill should not be delayed.

It rejected calls from stakeholders including Telstra – and supported by the Coalition – that the legislation be delayed until after the completion of Government’s National Broadband Network implementation study in February.

"The regulatory regime will operate regardless of the results of that study, and must be improved for consumers and carriers as soon as possible," the committee reported.

"The National Broadband Network should not be used as an excuse to delay reforms and to increase regulatory uncertainty."

It has directed Communications Minister Stephen Conroy to pursue concerns of the sector, particularly those related to consumer protections.

In a Dissenting Report, three South Australian Liberal senators Simon Birmingham, Mary Jo Fisher and Nick Minchin and Queensland senator Ian Macdonald recommended a delay of any further consideration of the bill until the NBN implementation study had been completed, and the Senate has seen Government’s response to that study.

Only then would the Senate have "certainty about the network structure of NBN Co and the regulatory framework which will surround it."

"Coalition Senators believe that the structure of Telstra is a matter for Telstra and its shareholders," the Dissenting Report concludes.

"The Government’s decision to hold a gun to the head of the company is a concerning precedent that has raises sovereign risk questions about the Australian investment climate."

"The threat to starve Telstra of future advanced mobile and wireless spectrum will harm rural and regional customers and will reduce competition in a highly competitive market."

The dissenting Senators strongly supported the some regulatory reforms of the Trade Practices Act in relation to ensuring competition improvements, but expressed reservations about some discretionary powers granted to the Minister.

Greens Senator Scott Ludlam, a committee member who supported the majority recommendations, said the legislation represented "a huge step in telecommunications reform," but added the Greens would seek amendments ensuring better consumer safeguards.

"We have framed our amendments primarily to protect the interests of the people who will actually use the network: the Australian public, particularly those who risk being left on the wrong side of the digital divide," Senator Ludlam told iTWire.

The Greens also want the bill amended to include a provision that would guarantee no Telstra worker would be worse off under the new regime – that pay and conditions would be transferrable to new employment arrangements.

Senator Ludlam also wants an Independent review of any amendments to the Trade Practices Act after three years to examine whether the access regime is functioning appropriately.

Nationals Senator Fiona Nash, who is not a committee member but participated in hearings, submitted additional comments to the final report supportive of the legislation.