Government on defensive over Alcatel NBN Co connection

Stan Beer
Saturday, 01 January 2011 20:52

IT Policy - Government Tech Policy

The Gillard Government has started 2011 facing a barrage of criticism from the Opposition over alleged ties between NBN Co CEO Mike Quigley, CFO Jean-Pascal Beaufret and Alcatel, which won an $85 million contract with NBN Co last June.

Mr Quigley was global president and COO of Alcatel-Lucent until 2007, while Mr Beaufret was CFO during a period when a corruption scandal occurred at the company.

The Opposition has highlighted the fact that Mr Quigley and Mr Beaufret were atop the corporate ladder at Alcatel-Lucent during a period when the company was involved in a bribery scandal for which the company has been fined US$137 million by the US Securities and Exchange Commission.

The scandal involved millions of dollars of bribes paid to government officials by executives of Alcatel subsidiaries in Central America and Asia in return for being awarded lucrative contracts.

NBN Co issued a statement yesterday denying any connection between Mr Quigley and Mr Beaufret and the bribery events, saying 'the actions of a number of individual Alcatel-Lucent employees detailed in the SEC's statement fell outside the accountability and jurisdiction of both Mr Quigley and Mr Beaufret.'

Neither executive was named in the SEC statement.

The NBN Co statement also stressed that neither Mr Quigley nor Mr Beaufret 'played any part in the decision-making process at NBN Co which led to Alcatel-Lucent being selected as a supplier to the company.'

However, the opposition, through its leader Tony Abbott, shadow communications minister Malcolm Turnbull and shadow finance minister Andrew Robb, have attacked the two NBN Co executives for denying any responsibility for events that occurred while they were senior executives of Alcatel-Lucent.

The opposition's Andrew Robb has also publicly ridiculed the credibility of the NBN Co statement that its two senior executives were not involved in the decision to award the telecoms contract to Alcatel saying that it 'beggars belief.'

While not attempting to implicate Mr Quigley in the Alcatel scandal, Mr Abbott today questioned his capability to run NBN Co because the scandal happened on his watch.

Faced with the growing controversy, the Prime Minister, Julia Gillard, has been forced to defend the NBN Co boss on TV today, saying he is a respected businessman and accusing Mr Abbott of engaging in smear tactics to try to discredit the NBN.

However, the Government in turn could find itself facing questions over its own links to Alcatel through Broadband and Communications Minister Senator Stephen Conroy's office.

In November 2009, Senator Conroy's then media adviser Tim Marshall accepted a position with Alcatel as the telco's external affairs director.