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The committee flagged its interest in private sector debt and/or equity NBN Funding when it released its second report last November. Then committee chairman, Rob Oakeshott, said: "A sale, if tightly contracted, could occur in several sections, and considerations therefore need to begin on what terms and conditions on behalf of consumers such a model could take place...If the majority parliamentary view is not to sell it, and indeed to keep it as a public asset returning an annual dividend to the taxpayer, then this change in the final policy position also needs to be made explicit for legislative reasons, and a debate about this deserves to occur soon."
He continued: "This public debate about the sale of the NBN, and the new process that is established as a consequence of such a debate, could be bought forward for the next NBN Co Corporate Plan. For this reason, work on exactly what the final product that is being built - whether a private or public one, whether sold in parts, as a whole or not at all - will be undertaken by the oversight committee throughout 2012."
However in its third report the committee says it has been advised by DBCDE that the existing legislative framework for the NBN leaves "very limited options for bringing forward private investment in NBN Co". Nevertheless, it says: "This need not slow progress now in exploring the cost/benefit of different capital structures for the NBN."
In the interests of securing debt and/or equity funding as early as possible the report says: "Any revisions to NBN Co's rollout targets will need to be closely monitored as any delays in this regard may push back projected timeframes for debt financing arrangements and private equity engagement (in the form of a direct interest in the share capital of the NBN), with possible implications for Government equity funding."
Furthermore, the report says: "Given that the opinions of debt providers on NBN Co's achievements, rollout timeliness and connections uptake will form the 'key metrics of credit quality' critical to its ability to raise external funding, NBN Co will need to ensure comprehensive performance reporting documentation on these areas."
Better documentation information and reporting are at the heart of many of the report's 15 recommendations. In particular:
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