What's the go with the Tassie NBN Company?

James Riley
Thursday, 05 November 2009 14:11

Opinion and Analysis

You wouldn't call the Tasmania NBN Company the bastard child of Communications Minister Stephen Conroy and Tasmanian Premier David Bartlett. Not in polite company, anyway.

But four months after it was created, the TNBN Co is looking orphaned. An orphaned shag on a rock, in fact.

TNBN Co has already started work on what will become tens of millions of dollars worth of capital works on behalf of its joint-venture partners. Only there is no joint-venture, and all of that work is being done on a promise – under a Memorandum of Understanding.

It is looking increasingly less likely that the Tassie NBN company will become the joint-venture originally envisaged. And that is probably something Tasmanians might want to understand a little better – given that it is their utility company that’s bank-rolling the muscle.

The Minister and the Premier donned hard-hats in mid-July to announce the early start of work in Tassie and the creation of the TNBN Co. The state government, after all, had already done a fair amount of preparatory work on network requirements.  The state had also already invested significant sums laying its own backbone fibre, and Aurora Energy assisted in that process.

Bartlett had already shown how keen Tasmania was to get amongst the NBN opportunities as the only state government to lodge a $5 million surety and make an official bid during the original NBN RFP process.

When the TNBN Co was announced – two weeks before the appointment of NBN Co executive chairman Mike Quigley – the intention was quite clearly that the state utility Aurora energy would become an equity partner in that company.

By extension – or perhaps even as well as – the Tasmanian Government was also to have been a TNBN Co shareholder (Aurora is a wholly-owned state enterprise.)

Somewhere along the way there must have been a rethink. And it seems probably that Quigley took one look at the structure and figured there had to be an easier way.

It is understood that Quigley's clear preference is that the Tassie company remains a wholly-owned subsidiary of the larger NBN Co. And that the Tasmanian Government and Aurora take an equity position in the mothership rather than the subsidiary.

Correction: Premier Bartlett appointed three local directors in late August: Mark Kelleher, secretary of Tasmania's Department of Economic Development Tourism and the Arts; Dr Dan Norton, a Tasmanian academic and chairman of the Tasmanian Ports Corporation; and Sean Woellner, a former CEO of Tenix Alliance. (Corrects earlier copy that indicated no Tasmanian board members had been appointed)

What Quigley ends up doing with Tasmania remains to be seen. But what he won't be doing is creating state-based NBN companies all over Australia simply to get access to the assets and resources of state governments and their utilities.

His preference is for one NBN Company, not six or seven or eight. Which makes you think he will soon look at doing some structural re-jigging in Tassie.

When the TNBN Co was announced, the Minister and Premier acknowledged that there were special circumstances on the island that required urgent consideration. They probably weren't referring to the March 2010 state election, but it can't have been far from mind.

Whatever Quigley does he will have to do against the back drop of that state election.

The structure of the company building the Tasmanian end of the NBN seems a small piece within the vastness of the national project.

But it's the kind of detail that people like to see kept tidy. It gives them more confidence that the back-of-envelope stuff is finished.

Meanwhile, the Tassie fibre roll-out continues.