Regulation: Telstra keeps up the pressure

Stuart Corner
Tuesday, 25 October 2005 18:51

IT Policy - Regulation

Telstra's chairman, in his address to the AGM, has continued Telstra's campaign of attacking the regulatory regime with claims that it is manifestly unjust and seriously damaging Telstra's business.

The chairman, Donald McGauchie, told shareholders: "...even the best operational performance will not deliver the returns you are entitled to expect on your investment in the current regulatory environment which deprives us of the ability to compete in the market with new and innovative products and services and provides little or no incentive to grow the company through investment in those products and services.... regulations restrict Telstra's ability to compete in rapidly changing and competitive environments populated by well-funded global competitors.

McGauchie suggest that the entire problem was the result of the conflict inherent in the government being both majority owner and regulator.

"We agree with the Government that Telstra's problems today are systemic - and we believe they are largely a result of the regulatory distortions triggered by the conflict of interest that is inherent in Government being owner and regulator during the sell down of its stake.

"There is little doubt that Telstra would be regulated like other industries if it were not for the politics of privatisation."