Changes to broadband arrangements to be considered by Parliament

The Telecommunications Legislation Amendment (Competition and Consumer) Bill 2017 will amend a number of Acts and Declarations to implement key parts of the Government’s response to a review of regulatory arrangements for the National Broadband Network (NBN). The Bill intends to promote competition, through reform of the ‘level playing field’ rules, as well as to fund future improvements to internet access for rural and regional Australia. 

The key measures in the Bill are:

  • changes to the superfast network rules (amendments to Parts 7 and 8 of the Telecommunications Act 1997 and Part XIC of the Competition and Consumer Act 2010)

  • the introduction of a statutory infrastructure provider regime into the Telecommunications Act  and

  • establishing an ongoing funding arrangement for NBN Co’s fixed wireless and satellite networks through the Regional Broadband Scheme (RBS).

The related Telecommunications (Regional Broadband Scheme) Charge Bill 2017 (the RBS Bill) will impose a charge on carriers to support the funding of fixed wireless broadband and satellite broadband across Australia. The Explanatory Memorandum notes that it is intended that the accrual of RBS charges commences on 1 July 2018. There is a small initial impact on the Budget to fund the Australian Communications and Media Authority and the Australian Competition and Consumer Commission’s initial set up costs in financial years 2016-17 and 2017-18 before funding raised by the charge becomes available.

In introducing the Bills, Minister for Urban Infrastructure, Paul Fletcher said that once established, ‘the Regional Broadband Scheme will provide certainty for regional Australians that their essential broadband services will be maintained and upgraded into the future.’

The Bills have come as a result of consultation with stakeholders which included exposure drafts of the Bills circulated in December 2016. The Bills were also referred to the Senate’s Environment and Communications Legislation Committee which tabled its report on 6 September 2017.

Issues that may arise during debate on these Bills include:

  • as part of the changes to the superfast network rules, proposed changes to the one kilometre exemption rule, to be replaced by the close proximity rule, which will result in network extensions of less than one kilometre only being available for superfast networks that existed prior to 1 January 2011that are being transferred to NBN Co under contracts. The close proximity rule will allow the connection of existing infrastructure in the street to premises, but not the extension of that network infrastructure to allow connection in a new location where the network is not already ‘in close proximity’.

  • the statutory infrastructure provider regime (SIP) in Schedule 3, which will give certainty of access to infrastructure to allow the delivery of superfast broadband services, but will not include satellite services. NBN Co will become the default SIP for the general service area of Australia and must connect a premises to a qualifying telecommunications network in order that the carriage service provide can provide qualifying carriage service to the end user

  • whether the Regional Broadband Scheme (RBS) which intends to spread the cost across NBN networks to enable the growth of broadband services across Australia, is the most appropriate way to fund these services and

  • the charge to carriers, is proposed to be $7.09 per month per chargeable premises that has an active fixed-line broadband service. The ACCC has decided that non-NBN networks would be permitted to pass on the proposed RBS charge to their wholesale customers.

Both Bills allow the Minister to determine aspects of the scheme (including the components of the charge) through legislative instruments. Both Bills also adjust the usual parliamentary disallowance process that applies under section 42 of the Legislation Act 2003. The Legislation Act requires each legislative instrument to be laid before each Chamber of Parliament within six days of being registered. Within 15 sitting days of that time, a member of the Chamber may move a motion to disallow the instrument. This motion must be dealt with within 15 sitting days of being moved. The instrument will be disallowed in two circumstances, firstly, if the Chamber passes a resolution disallowing the instrument and secondly, if the motion has not been dealt with.  As provided in Odgers':

This provision ensures that, once notice of a disallowance motion has been given, it must be dealt with in some way, and the instrument under challenge cannot be allowed to continue in force simply because a motion has not been resolved. The provision greatly strengthens the Senate in its oversight of delegated legislation.  

The Bill proposes a different arrangement, whereby if a motion to disallow a relevant legislative instrument has not been dealt with in the Chamber, the instrument will come into effect, rather than be taken to be disallowed. The Senate Committee recommended that amendments be made relating to disallowance procedures for determinations of the amount of the charge (Recommendation 1). This recommendation was an endorsement of the comments made the by the Senate Standing Committee for the Scrutiny of Bills, which ‘described the divergences from the usual disallowance process as having a ‘significant practical impact’ on parliamentary scrutiny of the RBS determinations’.

In their additional comments, Labor Senators noted stakeholder concerns regarding ‘incoherent logic’ underlying the design of the RBS and that the Senate inquiry process had not established that the proposed RBS ‘is the most effective and efficient method of achieving the stated policy objectives.’ Further, in a dissenting report, the Australian Greens recommended revising the RBS, ‘taking into consideration updated costings, the current and emerging state of telecommunications technology and markets, and recommendations from the Productivity Commission regarding the Telecommunications Universal Service Obligation.’

Since the tabling of the report, the Government announced plans to implement a Universal Service Guarantee (USG) in 2020, to ensure that all Australians have access to voice and broadband services. This will replace the Universal Service Obligation (USO) and is intended to reflect changes in the market and technology. This, together with the introduction of the SIP regime, should assist in ensuring all Australian premises have access to broadband services that are capable of 25Mbps per second download and 5Mbps upload speeds.  


Flagpost is a blog on current issues of interest to members of the Australian Parliament

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