Sunday, 16 February 2014 14:26

Maybe we did overestimate Labor’s NBN cost, admits Government Featured

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Malcolm Turnbull’s Parliamentary Secretary Minister Paul Fletcher has admitted that the Coalition’s estimate of the cost of Labor’s NBN was ‘perhaps a little high’.

Oh … THAT $34 billion! In the lead up to the last Federal Election, Malcolm Turnbull and the Coalition incessantly said that the real cost of Labor’s NBN would be in the order of $90 billion, compared to Labor’s own figure of $39 billion.

Turnbull’s Assistant Minister has now said that NBN Co’s internal review of Labor’s NBN costed it at $56 billion, still high but much closer to Labor’s figure than the inflated estimate the Coalition took to the election.

Fletcher was speaking at the TechLeaders 2014 forum for IT journalists being held on the Gold Coast, where he gave the keynote address. Most of his talk was a spirited defence of the Government’s NBN policy.

He accused the previous government of severe mismanagement, saying the Coalition inherited an ‘NBN nightmare’ which his Government was fixing. All the usual stuff. But his comments on the costing disparity was the first such admission by a member of the Government.

When asked by iTWire about the disparity between the Coalition’s $90 billion estimate of a FTTP network and the much lower NBN Co estimate (made by the management team the Coalition had put into place) of $56 billion, the best Fletcher could say was that the Coalition estimate “may have been a little high.”

The Coalition has of course promised a much cheaper network by using FTTN technology mixed with FTTP and other technologies (a ‘technology agnostic’ network), but even the cost of its own network has increased since it was announced.

Fletcher is a former Optus executive. He does not have Malcolm Turnbull’s profile, but as Turnbull’s offsider Fletcher has a significant say in Government Communications and IT policy. His remarks showed a thorough grasp of policy, if not costings.

His talk was well received by the same group of journalists that gave Malcolm Turnbull such a hard time at the same event last year. The conference ends on Tuesday, when the closing address will be given by the Opposition Communications spokesman.


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Graeme Philipson

Graeme Philipson is senior associate editor at iTWire. He is one of Australia’s longest serving and most experienced IT journalists. He is author of the only definitive history of the Australian IT industry, ‘A Vision Splendid: The History of Australian Computing.’

He has been in the high tech industry for more than 30 years, most of that time as a market researcher, analyst and journalist. He was founding editor of MIS magazine, and is a former editor of Computerworld Australia. He was a research director for Gartner Asia Pacific and research manager for the Yankee Group Australia. He was a long time weekly IT columnist in The Age and The Sydney Morning Herald, and is a recipient of the Kester Award for lifetime achievement in IT journalism.

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