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Wednesday, 08 September 2010 16:41

ACCI: Room for compromise on NBN

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The Australian Chamber of Commerce and Industry wants much more detail on the cost of the National Broadband Network roll-out, and expects that the political reality of the Gillard Government's razor-thin majority will ensure that detail is forthcoming.

ACCI chief executive Peter Anderson said the election highlighted a "strong appetite" among Australians across the political spectrum for investment in "decent broadband," but he placed caveats on suggestions that Government has a simple mandate to get on with the job.

Depending on what a detailed cost analysis revealed, Anderson said there was most to be likely room for compromise in the precise structure and technology make-up of the NBN if a compromise was required.

"The issue really comes down to the capacity of the country in the current environment to be able to afford costs and whether those short term costs can be borne, given we have a fiscal position which is also very fraught," Anderson said

"Rolling out a broadband network I think should proceed. But I think it would be highly desirable for the Government to be more transparent about the cost benefit analysis that needs to be conducted," he said.

"One of the benefits of the new political environment is that it allows Government to be confronted by alternative views which the government has to consider, because it just can't demand its own way (in the next Parliament,)" Anderson told iTWire.

"And there are some alternative approaches which can be allied to the National Broadband Network, and they should be a part of the mix," he said.

Anderson said the Chamber had been a supporter of the broadband roll-out, but had become increasingly concerned in the last Parliament about how little cost detail for the project had been released and has called for Stephen Conroy to make public a full cost-benefit analysis of the project.

Communications Minister Stephen Conroy has resisted conducting a cost-benefit investigation of the project, saying the process would be a waste of time and money. He argues that any medium- to long-term assumptions about the network on which such analysis were would be meaningless, because it was impossible to predict the nature and impact of the future services that run on the network over its lifetime.



Senator Conroy released a $25 million KPMG-McKinsey Implemention Study into the project in March, a report that found the project was challenging but doable. It concluded the roll-out could be achieved on budget - based on the $43 billion initial cost estimate within the 8 year timeframe outlined by Government.

Anderson said the Chamber didn't necessarily see the $43 billion price tag as an issue, but without a clear and independent understanding of benefits, it was impossible to make a judgement on whether the full extent of Labor's so-called "gold standard" fibre network was justified.

"We are (in agreement) with the prospect that businesses in regional Australia needs to be able to access technology in a way that allows them to drive productivity and efficiency in the same way that businesses in urban areas do," Anderson said.

"But there is a cost of doing that. In rolling out major infrastructure Government's have always provided some degrees of subsidy that itself is not undesirable," he said.

"Ultimately we need to make sure that the costs do stack up with the benefits."


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