Bills Digest no. 42 2005–06
Appropriation (Regional Telecommunications
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
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Appropriation (Regional Telecommunications
House: House of
Portfolio: Finance and Administration
Commencement: Royal Assent
To appropriate $219.218 million
to the Department of Communications, Information Technology and the
Arts (DCITA) for subsidies to certain regional telecommunications
programs as part of the privatisation of Telstra.
The broader context of the Bill is the subsidisation of regional
telecommunications as part of the sale of Telstra. For additional
information, see the Bills Digests for the Telecommunications
Legislation Amendment (Future Proofing and Other Measures)
Bill 2005 and the Telecommunications (Carrier
Licence Charges) Amendment (Industry Plans and Consumer Codes)
The other Bills in this suite of legislation are the
Telecommunications Legislation Amendment (Competition and
Consumer Issues) Bill 2005 and the Telstra
(Transition to Full Private Ownership) Bill 2005.
According to the second reading speech, the funding is for two
The Higher Bandwidth Incentive Scheme (HiBIS) is an on-going
program, which provides internet service providers with incentive
payments to supply higher bandwidth services in regional areas at
prices comparable to those in metropolitan areas. HiBIS is part of
the Government's contribution to the
National Broadband Strategy(1) and was established
in response to a recommendation of the Regional
Telecommunications Inquiry (the Estens Inquiry).(2)
Service providers receive $1540 for connecting premises with faster
internet services over a digital telephone line or $3300 for
premises without such access. Providers are required to use the
payments to reduce the price of services or to help offset the cost
of providing services to regional areas without such access. The
Bill seeks additional funding of $67 million in 2005-06 because of
higher levels of demand , according to the Minister s second
In its Portfolio Budget Statements, DCITA includes HiBIS as an
administered item, in outcome 3, under the heading of Regional
Telecommunications Inquiry response .
Connect Australia is a new program, which Senator Hon. Helen
Coonan (Minister for Communications, Information Technology and the
announced(3) on 17 August 2005. The program has
Broadband Connect: $878 million will be
provided to expand broadband services
according to the Minister s second reading speech, broadband
connect will be based on HiBIS but will introduce refinements to
encourage providers to increase the areas they service, and to
limit the possibility of providers recovering more than the
legitimate capital costs of installing broadband infrastructure .
The Minister did not, however, elaborate on how this will be
Clever Networks: $113 million will be provided to roll
out new broadband networks to improve the delivery of health,
education and other services
Mobile Connect: $30 million will be provided to extend
terrestrial mobile coverage to areas where they can be commercially
maintained and continue satellite handset subsidies for other
Mobile Connect will build on the
Regional Mobile Phone Programme(5) (which was
established with $40.6 million over three years from 2001-02) and
will subsume the Satellite Handset Subsidy Scheme (which subsidises
the purchase of mobile satellite phones by people living in areas
beyond CDMA or GSM terrestrial mobile coverage), and
Backing Indigenous Ability:(6) $90 million will
be provided for telephones, internet and videoconferencing in
remote indigenous communities and improved indigenous radio and
The Bill seeks funding of $148.8 million in 2005-06 for the
broadband connect and the mobile connect elements.
Connect Australia also falls within DCITA s outcome 3.
The Bill also seeks around $3.5 million in 2005-06 for
departmental expenses, that is, for the cost to DCITA of
administering the programs.
The Bill is to all intents and purposes, identical with Appropriation
Act (No. 1) 2005-06,(7) with the definitions and
wording of most clauses in the Bill the same as in that Act. The
Bill s legal effect is thus very similar to an annual appropriation
Act. The main differences in the Bill follow.
Clause 3, which contains definitions, includes
a definition of Portfolio Supplementary Estimates Statements . They
are the documents akin to the Portfolio Budget Statements that
DCITA published, and which provide information about the
appropriation in the Bill. Clause 3 also defines Portfolio Budget
Statements to mean those presented in relation to Appropriation
Act (No. 1) 2005-06 and Appropriation
Act (No. 2) 2005-06.
Clause 11 deals with Comcover receipts and
relates to section 13 of Appropriation Act (No. 1)
2005-06. Agencies pay premiums to Comcover to
cover, for example, physical injuries that agency employees incur.
Comcover pays agencies for any successful claims against Comcover.
Section 13 of Appropriation Act (No. 1)
2005-06 provides that any amount that Comcover
pays to an agency is added to that agency s funds. In the words of
section 13, the Comcover payments are added to an available item .
In effect, clause 11 provides that Comcover receipts are added to
an available item in Schedule 1 of the Bill.
Schedule 1 sets out the services for which funds are
appropriated. The main feature of Schedule 1 appears on page 15 of
the Bill where it shows that a total of $219.218 million will be
appropriated to DCITA s Outcome 3. This is split between $3.459
million for departmental expenses and $215.759 million for
9 September 2005
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© Commonwealth of Australia 2005
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