Chapter Five
The exposure drafts: NBN Co Bill
Introduction
5.1
On the same day the Government announced that it would establish a
company (NBN Co Ltd) to build and operate a new super-fast National Broadband
Network, it also foreshadowed that it would introduce legislation establishing:
- governance, ownership and operating arrangements for the
wholesale only NBN company; and
- the access regime to facilitate open access to the NBN for retail
level telecommunications service providers.[1]
5.2
That announcement was made on 7 April 2009. Over ten months later, on
24 February 2010, the Minister finally released exposure drafts of the
foreshadowed legislation.[2]
The two drafts released were the:
-
National Broadband Network Companies Bill 2010 (the 'NBN Co
Bill'); and
- Telecommunications Legislation Amendment (National Broadband
Network Measures––Access Arrangements) Bill 2010 (the 'Access Bill').
5.3
Explanatory Notes for the exposure drafts were also circulated.
5.4
The Government has stressed that the exposure drafts of the legislation
are just that – drafts – and that they have been issued 'to facilitate
consideration of the proposed legislation prior to it being introduced into
Parliament'.[3]
The Government has also stated that it is 'willing to consider amendments to
the legislation if compelling arguments are put forward'.[4]
5.5
Simultaneous with the committee's inquiry, the Department has undertaken
its own consultation process on the exposure drafts of the legislation. At the
time of writing, the Department had not published the 20 submissions it had
received.[5]
The committee's expectation is that once the bills have been finalised and
introduced into Parliament, they will be subject to further, and comprehensive,
scrutiny by a standing legislative committee of the Senate.
5.6
For that reason the committee has restricted itself to highlighting the
key areas of concern raised in submissions to it. The remainder of this chapter
addresses matters raised in relation to the NBN Co Bill. Chapter six addresses
the Access Bill.
NBN Co Bill
General outline
5.7
In broad terms, the NBN Co Bill provides for:
- the operations of NBN Co, including rules about the supply of
services by NBN Co and its wholly owned subsidiaries (Part 2);[6]
- the ownership and control of NBN Co, including that it is to be a
Commonwealth majority owned company during the rollout of the NBN but that once
the NBN is declared 'built and fully operational' by the Communications Minister,
the Commonwealth must sell its remaining equity in NBN Co within the following
five years unless that period is extended by the Finance Minister (Part 3).
This Part of the Bill also provides for what constitutes 'unacceptable private
ownership or control' situations and the consequences to apply;[7]
and
- miscellaneous matters, including that NBN Co is not a public
authority, that it may be wound up in accordance with the Corporations Act
2001 (Cth), and that the Communications Minister and the Finance Minister
may delegate all or any of their Ministerial powers and functions under the Act
(Part 7).[8]
5.8
Submissions to the committee were quite focussed as to the key areas of
contention. They related to:
- whether NBN Co would be restricted to supplying only wholesale
services, what would constitute the appropriate service, to whom that service
could be supplied, and the circumstances in which any exemptions should apply;
- the merit of the cessation of majority Commonwealth ownership and
the implications of this event occurring;
- the comprehensiveness of provisions governing the terms of
private ownership and control; and
- other additional matters not currently provided for in the NBN Co
Bill and which it was proposed the NBN Co Bill should be amended to address.
Wholesale only services
5.9
In Part 2, clause 9, the Bill provides that NBN Co must only supply
services to 'a carrier' or 'a service provider'. The terms 'carrier' and
'service provider' are defined as having the same meanings as in the Telecommunications
Act 1997.[9]
In effect, this restricts NBN Co to supplying services to either a holder of a
carrier license,[10]
or a 'carriage service provider' or 'content service provider'.[11]
A 'carriage service provider' is a person who supplies or proposes to supply a
listed carriage service to the public (meaning the carriage of communications
between two end users each of whom is outside the immediate circle of the
supplier of the service).[12]
A 'content service provider' is a person who uses or proposes to use a listed
carriage service to supply a content service to at least one end user who is
outside the immediate circle of the supplier of the content.[13]
5.10
After providing that NBN Co can only supply services to carriers or
service providers, clause 9 immediately provides for an exemption. Subclause (9)2
enables the Communications Minister to, by legislative instrument, exempt a
specified service from the scope of subclause 9(1) 'subject to such conditions
(if any) as are specified in the exemption'.[14]
In effect this would enable NBN Co to supply a specified service to persons
other than carriers, carrier service providers or content service providers,
subject to conditions specified by the Minister.[15]
One example given in the Explanatory Notes is an exemption allowing NBN Co to
offer services directly to certain end-users, for example, government agencies.[16]
The Minister is obliged to consult with the ACCC before exempting a service.[17]
5.11
There was considerable confusion amongst submitters as to three principal
aspects of the operation of clauses 9 and 10.
- First, concerning the operation of subclause 9(1): to whom would
NBN Co ordinarily be able to supply services. Specifically, who would qualify
as a 'service provider' for the purpose of obtaining services from NBN Co.
- Second, concerning the operation of subclause 9(2): what would
the exemption in subclause 9(2) enable the Communications Minister, and consequently
NBN Co, to do?
- Third, concerning the operation of clause 10: the extent to which
the exemption to the prohibition on NBN Co supplying content services
undermined the extent to which NBN Co will be a 'wholesale only' company
consistent with the Government's stated policy objectives.
5.12
Some submitters commented that the Ministerial exemption provisions
could potentially enable NBN Co to provide retail services to end-users. Others
expressed the belief that, particularly in regards to subclause 9(2), it would
merely enable NBN Co to provide Layer 3 services (which are
effectively wholesale services) to companies other than telcos and should be
exercised in the event that a competitive wholesale market for the supply of
these services does not develop.[18]
Submitters differed in the extent to which they supported the Ministerial power
and the circumstances in which it might be exercised.
Critics of clauses 9 and 10
5.13
The Business Council of Australia interpreted clauses 9 and 10 and the
provision for Ministerial exemption, as potentially allowing NBN Co to 'offer
fully integrated wholesale services and direct supply to end-users'.[19]
It continued that the provisions:
...therefore allows NBN Co. to expand its product offer
further into the value chain, a significant departure from both the original
policy intent and from the understanding in the industry and wider community
about the NBN Company’s function and operation in the market.
The change in policy has no obvious supporting rationale nor
an assessment of the net benefits from this greater level of government
intervention in the market. It is also puzzling that the government would take
action to remove vertical integration in the fixed line sector only to then
replicate the same integrated structure within a government business.
Furthermore, the suggested ministerial discretion lacks proper safeguards and
will create uncertainty for competing private investors as long as it is in
place.
The expansion of NBN Company’s scope of operations and the
inclusion of ministerial discretion should be removed from the draft
legislation.[20]
5.14
The Western Australia Chamber of Commerce and Industry similarly argued
that it is 'essential to ensure NBN Co does not operate in the retail market
where it could provide preferential treatment to its own retail services to the
detriment of competition'.[21]
5.15
Optus was typical of the attitudes of incumbent retail internet and
telecommunications service providers such as AUSTAR United
Communications[22]
and iiNet,[23]
when it criticised the Ministerial exemption provision in clauses 9 and 10
as being contrary to the policy rationale for the NBN Co:
For the NBN to fully realise its potential Optus has always
maintained that the NBN would need to be true to the Government's clear
commitment that it will be operated as a structurally separated, wholesale-only
operation on genuine open access arrangements. Such an approach would avoid the
well documented problems we have witnessed in the current fixed line market
structure. Moreover, a regime built on these principles has the potential to
set a platform for a highly competitive retail market to emerge which in turn
is likely to lead to affordable high-speed broadband services and high take-up
by businesses and consumers.[24]
5.16
Based on those policy arguments, Optus submitted that, because it
believes that the Bill 'provides NBN Co with significant scope to operate as a
retail service provider of telecommunications or content services', it
represents 'a significant and deeply worrying step-back from the Government's
clear commitment to operate the NBN Co as a wholesale-only provider'.[25]
Optus therefore proposed:
The draft Bill should be amended to remove the discretion of
the Minister to make any exemptions to NBN Co's ability to operate as a
wholesale-only provider of telecommunications and content services...
NBN Co should be restricted to supplying services at Layer 2
and below.[26]
5.17
In a separate submission, Primus argued that instead of removing the
Ministerial exemption power in clause 9, there should be clarification and
circumscription of its potential use:
Firstly, there is a lack of detail about when the
Communications Minister could make such a determination. Primus suggests the
Government establish specific criteria or guidance around the making of such a determination.[27]
The other concern of Optus and other incumbent internet
service providers was the extent to which non-carriers could be characterised
as 'service providers' and therefore be eligible, even in the absence of the
exercise of Ministerial discretion, to acquire services from NBN Co. Optus
submitted that 'NBN Co should be restricted to supplying services to carriers
only'.[28]
Primus argued that:...to ensure a wholesale arrangement is not artificially
constructed to undermine the 'wholesale only' principle, the Government should
impose further rules defining when a 'carrier or service provider' can acquire
services from NBN Co. For example, a company should actively provide services
to the end-user market and have a standing offer available for acceptance in
order to be characterised as a service provider.[29]
5.18
iiNet also submitted that, if retained, the definition of a 'service
provider' needs clarification because:
If I was Wesfarmers or the Department of Defence or some
other large corporation that had the skills and the resources internally to
develop their own telecommunications services for internal corporate use, what
is stop them going out and putting a jingle up that says ‘I’m a wholesale
customer’?[30]
5.19
Consumer and end-user advocacy groups were divided in their attitudes to
clauses 9 and 10 of the NBN Co Bill. The Internet Society of Australia
(ISOC-AU) recommended that the exemption powers be abolished. In the
alternative, ISOC-AU submitted that, if retained, 'the need for such exemptions
should be made clear, and the section significantly tightened so that exemption
can be made only in very limited, specific circumstances and where such a
significant change to the wholesale access only policy can be justified'.[31]
The Australian Communications Consumer Action Network (ACCAN) recommended that
NBN Co operate solely as a wholesale provider and the exemption powers, which
might allow it to operate retail services, be removed from the Bill.[32]
Supporters of clauses 9 and 10
5.20
On the other hand, Ms Rosemary Sinclair, Chair of the Australian
Telecommunications Users Group (ATUG) explained that in her view, commentary
such as that of Optus, was 'misunderstanding' the purpose of clauses 9 and 10
and that it was in fact a good thing for the prospects of future innovation and
service delivery over the NBN:
I do not know whether it is the lawyer in me, but I read the
whole thing, so when I got to clause 9...after having read the
definitions—clause 1, 2, 3, up to 8—and read it in the context of all the
previous statements that say NBN is going to be a wholesale only company, I
say, ‘Okay, that means that there’s the potential for NBN to offer wholesale
type services to other than telcos.’ I think that is a good prospect because I
think that one of the problems that we have is that, if we do not have that
kind of reserve power, we are actually limiting the prospects for innovation to
the existing communications sector. From where I sit, the prospects for
innovation are going to come from outside that sector.[33]
5.21
However, Ms Sinclair also indicated that, although supportive of
proposed clauses 9 and 10, ATUG considers the current definition of customers
of NBN to be insufficient:
ATUG would like to see the definition of customers of NBN
broadened to include businesses and government agencies who wish to use NBN
broadband to deliver services to their customers or clients eg Health
Department, Education Department, Systems Integrators, Content Service
Providers.
The current definition of “carriage service provider” does
not seem to ATUG to envisage this new group of wholesale service customers and
the existing obligations on service providers would not be appropriate to these
new service providers.
The existing definition of content service provider suggests
the services are provided to the public at large rather than a defined group of
clients or service end users including businesses in the case of Systems
Integrators.[34]
5.22
Mr Paul Budde, explained his view of the merit of clauses 9 and 10 as
follows:
We certainly need to ask the question: what gets priority
here – competition policy subtleties or the national interest? I would like to
stress that the issue is the creation of an infrastructure such that
competition may be maximised at the services level.
This concern seems to be addressed to a certain extent in the
proposed NBN Co legislation, which will give the government the
possibility of allowing sectors to buy infrastructure capacity directly from
NBN Co.[35]
Explanation from the Department
5.23
Following the committee's final hearings, the committee sought an
explanation from the Department as to the decision to insert a Ministerial
discretion in proposed subclause 9(2) of the NBN Co Bill enabling the Minister
to exempt NBN Co from wholesale-only service restrictions. The Department
provided the following response:
The objectives of the NBN Co Bill make it clear that NBN Co
will operate on a wholesale-only basis (proposed section 3(2)(a)). NBN Co has
clearly stated that it will offer Layer 2 bitstream services. These are, by
their nature, wholesale services, not retail services.
...
This provision was included because some sophisticated
end-users, such as some government agencies and corporate users, may want to
buy wholesale services directly for their own internal use. It was considered
appropriate that the option should exist for such end-users to be able to seek
services directly from NBN Co for their use, rather than having to force them
to use intermediary providers that could simply add unnecessarily to their cost
structures. The Australian Telecommunications Users Group (ATUG) has supported
this provision. Clearly if NBN Co were to supply such end-users it would need
to be on the basis that they were not favoured over other customers of
wholesale services.
For any end-user to be able to benefit from such an
exemption, it would need to be able to invest in equipment to transform the
bitstream service into useable services such as telephony or broadband. This is
not a simple undertaking and would require the end-user to invest in necessary
equipment and staff as opposed to simply purchasing higher level service from
other providers. NBN Co would not be competing directly with retail providers
to provide services to customers simply seeking a broadband or telephony
service in the everyday retail marketplace.
While this is the reason the provision has been included in
the Bill, the Bill is an exposure draft designed to elicit feedback. The
legislation will be finalised in light of that feedback.[36]
Committee view
5.24
The committee believes that NBN Co should be a supplier of wholesale
services only. By 'wholesale', the committee means that NBN Co should not be
permitted to supply services higher than Layer 2.
5.25
The committee believes that NBN Co should only provide services at Layer
2 and below.[37]
In the event that a competitive market for the supply of unbundled Layer 3
services does not develop, then the committee recommends that a Universal
Service Obligation should be considered for addressing this failure,
particularly in regional and remote areas.
Recommendation 12
5.26 That the NBN Co Bill be amended so that NBN Co can only provide services
at Layer 2 and below.
5.27 That, in the event that a competitive market for the supply of unbundled
Layer 3 services does not develop, the Government consider arrangements for a
Universal Service Obligation to address this failure, particularly in regional
and remote areas.
Cessation of majority Commonwealth
ownership
5.28
In Part 3, clauses 21–25, the Bill provides for the Communications
Minister to declare, before 30 June 2018, that the NBN should be treated as
'built and fully operational'.[38]
The Finance Minister must, within five days, then declare that either (a)
conditions are suitable for the entering into and carrying out of an NBN Co
sale scheme[39]
(with the consequence that the Commonwealth must then sell all of its remaining
equity in NBN Co within five years or an extended period if the Finance
Minister so declares[40]),
or (b) declare a 'sale deferral period' during which the Commonwealth is not
required to sell its equity in NBN Co.[41]
The deferral period must not be longer than 12 months,[42]
but the Bill contains no limit on the number of deferrals that the Finance
Minister may make. The declaration by the Communications Minister, and the
subsequent declarations by the Finance Minister, are not legislative
instruments.[43]
5.29
Some submitters raised concerns about the implications that a cessation
of majority Commonwealth ownership will have, particularly for service delivery
in regional and remote areas. For example, the Indigenous Remote Communications
Association (IRCA) submitted that because of its concerns that 'remote
Australia will not provide viable returns for future purchasers of NBN Co, thus
leading to reduced services', IRCA would 'like to see the Government retain a
stake in NBN Co beyond its sale, in relation to wholesale service provision of
broadband to remote Australia'.[44]
IRCA submitted this was necessary to ensure 'the ongoing provision of quality,
subsidized or affordable broadband to sparsely populated regions'.[45]
5.30
The Australian Communications Consumer Action Network submitted that the
'object of the [NBN Co] Bill be expanded to enshrine the role of the NBN Co in
ensuring access to affordable fast broadband, accompanied by a requirement to
produce five-year implementation plans'.[46]
ACCAN submitted such an amendment would provide a legislative protection to
'deliver the type of broadband future that Australians want and need'.[47]
5.31
The Communications Law Centre of the University of Technology Sydney,
submitted that the current ownership limitations 'do not shed light on the way
in which NBN Co will have incentive to maintain and upgrade its network once
the Government sells down its shares'.
In a worst-case scenario, this would result in Australia's
telecommunications infrastructure being controlled by a monopoly immune from
market pressure.[48]
5.32
Finally, Mr Allan Horsley, an individual with some 45 years of
experience in design, operational, representative and regulatory telecommunications
roles, drew attention to the lack of reporting obligations on NBN Co when it
ceases to be a Commonwealth majority owned corporation. Part 4 of the NBN Co
Bill requires, amongst other things, NBN Co to keep the Communications Minister
and the Finance Minister informed of the operations of NBN Co and NBN Co
subsidiaries,[49]
an obligation which would presumably include providing information about the
service performance of the NBN. However, all reporting obligations contained in
Part 4 of the Bill cease to apply once the Commonwealth ceases to hold a majority
of the voting shares in NBN Co.[50]
Mr Horsley submitted that the lacuna in information disclosure should be
remedied by amending the NBN Co Bill:
The legislation [should] require the development of
appropriate regulations by the Australian Communications and Media Authority...to
establish an appropriate monitoring and reporting arrangement to ensure
Government and the community are fully informed on the service performance of
the NBN, reporting each six months for the first five years of full network operation
and then each twelve months thereafter if service quality is considered to have
been generally satisfactory in the initial five years.[51]
Committee view
5.33
The committee does not believe that it is necessary for the Commonwealth
to retain majority ownership of NBN Co in the long term, as long as legislation
governing NBN Co's operations also sets out mandatory minimum service
requirements for the company. Those requirements should, at a minimum,
statutorily require NBN Co to fulfil the Government's stated policy objectives
for the NBN. They are that:
- 100 per cent of Australian premises receive super-fast broadband
services (with 90 per cent receiving Fibre to the Home services with speeds of
up to 100 Mbps, and the remaining 10 per cent receiving speeds of at least
12 Mbps); and
-
NBN Co provide wholesale services on an open-access and
equivalent basis.
5.34
The governing legislation should also impose on NBN Co a continuing
obligation to upgrade services to Australians into the future so as to positively
ensure that Australia's broadband network is not 'frozen' at present
technological standards and capabilities.
5.35
The committee understands that the draft legislation would not enable
the Commonwealth's majority ownership to be sold down until the Communications
Minister has declared that the NBN should be treated 'as built and fully
operational'.[52]
The committee is concerned that there is a lack of definition in the NBN Co
Bill as to what constitutes 'built and fully operational'. The committee believes
that subclause 22(5) of the NBN Co Bill (which provides the matters to
which the Communications Minister must have regard in deciding whether to make
the declaration) should be amended so that a declaration cannot be made unless
the NBN in fact covers 90 per cent of Australians with services of 100 Mbps,
and the remaining 10 per cent of Australians with services of at least 12 Mbps.
5.36
Additionally, the committee has the following three concerns about the
implications which will flow from cessation of majority Commonwealth ownership.
- First, that there is currently no obligation explicitly set out
in the draft legislation requiring NBN Co to maintain its capability to provide
broadband services to 100 per cent of Australian premises with services of at
least 12 Mbps. The committee understands that one potential method of
ensuring continued coverage might be to mandate it as a condition of NBN Co's
carrier licence.[53]
However, the committee believes that it is more appropriate that such an
obligation be explicitly set out in the governing legislation, as a minimum
service obligation, providing upfront certainty for all Australians and
stakeholders as well as future investors.
-
Second, that loss of Commonwealth majority ownership will remove
any future incentive for NBN Co to upgrade its services to unprofitable areas –
likely to be regional and remote areas – following the initial rollout of the
NBN. The result is that broadband services to these areas may be 'frozen' at
levels which prove inadequate for future communications needs. The committee
notes on this point the commentary in the Implementation Study that 'NBN Co, as
a monopoly and after completion of the roll-out and if the copper and HFC
networks are deactivated, will lack competitive pressure to optimise its
operations.'[54]
After noting that one consequence may be higher prices charged to operators,
the Implementation Study commented that '[i]n the absence of competitive
pressure, NBN Co will have limited incentive to engage in rigorous cost
management'.[55]
The committee believes the Government should amend the legislation so as to
require NBN Co – regardless of the Commonwealth's equity stake in it –to ensure
that broadband services are available to all Australians on an equitable basis[56]
and to a minimum level service standard.
- Third, that loss of Commonwealth majority ownership may result in
the cessation of public disclosure obligations of NBN Co as to its service
performance. The committee believes that NBN Co should be subject to continual
public disclosure requirements as to its service performance, and that these
requirements should continue even after the cessation of majority Commonwealth
ownership. The committee did not receive sufficient guidance from submitters as
to whether requirements under the Corporations Act 2001 (Cth) would
sufficiently fulfil any lacuna.
Recommendation 13
5.37 That provisions of the NBN Co Bill relating to the future privatisation
of NBN Co be amended to clarify what is meant by 'built and fully operational'.
Recommendation 14
5.38 That the NBN Co Bill be amended so that a declaration by the
Communications Minister that the NBN should be treated as built and fully
operational is a disallowable instrument. That is, that clause 22(8) of the NBN
Co Bill stating that such a declaration is 'not a legislative instrument' be
deleted.
Recommendation 15
5.39 That the NBN Co Bill be amended so as to expressly require NBN Co to
meet minimum service obligations after the cessation of Commonwealth majority
ownership. Those obligations must include that:
- NBN Co retain its capacity to provide broadband services to 100
per cent of Australian premises;
- NBN Co retain its capacity to service 90 per cent of Australian
premises with Fibre to the Home services with speeds of up to 100 Mbps;
- NBN Co retain its capacity to service the remaining 10 per cent
of Australian premises with broadband connections of speeds of at least
12 Mbps;
- NBN Co develop and maintain its capacity to supply Layer 2
services to 100 per cent of Australian premises; and
- NBN Co maintain its open-access network, providing wholesale
services on an equitable basis.
Recommendation 16
5.40 That the Government consider ways to 'future-proof' NBN Co's services.
This must include a specific requirement that NBN Co report to the ACCC every
five years on developments in broadband services in other comparable advanced
economies, and that if the report demonstrates that NBN Co's services are
falling behind those available to a majority of end users in other comparable
advanced economies, lay out a plan to close the gap.
Recommendation 17
5.41 That the NBN Co Bill be amended so as to explicitly require NBN Co to
publicly disclose its service performance even after the cessation of majority
Commonwealth ownership.
Private ownership and control
5.42
Division 3, clauses 41–46 make provision for restrictions on what is
termed 'an unacceptable private ownership or control situation'[57]
occurring or continuing. The NBN Co Bill leaves it to regulations, developed
after consultation with the ACCC, to determine what in fact will constitute an
unacceptable private ownership or control situation.[58]
5.43
Optus was the most vocal on this issue, suggesting that these
arrangements are 'wholly inadequate' because the prospect remains that 'a
retail telecommunications provider could gain an effective controlling stake in
NBN Co which significantly compromises the reform credentials of the NBN'.[59]
Optus submitted the NBN Co Bill should be amended so as to limit a retail
telecommunications provider from taking more than a 20 per cent stake in NBN Co,
and clearer rules should be established to prevent a minority shareholder from
exercising effective control of the NBN Co.[60]
5.44
The Department explained that it was intended that regulations which
would be made subject to consultation with the ACCC and which would be
disallowable instruments, would sufficiently address concerns such as those
voiced by Optus.[61]
However, the Department also stated that 'the Government is now considering its
approach in light of the submissions on the exposure drafts and the
Implementation Study'.[62]
5.45
Other submitters raised concerns about whether, during the term in which
NBN Co is majority Commonwealth owned, private investors will have sufficient
access to information provided by NBN Co to the Government. The Business
Council of Australia submitted that:
The Bill does not, however, explicitly set out the rights to
information for any future minority non-government owners of NBN Co... For the
avoidance of any doubt, the Bill should set out the basis on which minority
equity owners can request access to any information provided by NBN Co. to the
government. In principle, all information provided to the Ministers for
Communications and Finance should also be provided to minority equity holders.[63]
5.46
The Department stated in response that NBN Co 'should receive the same
legal treatment as other Commonwealth companies' and referred to the continuous
disclosure obligations under the Corporations Act 2001 and the reporting
obligations in the Commonwealth Authorities and Companies Act 1997.[64]
Committee view
5.47
The committee believes that, given regulations made under clause 41 will
be legislative instruments, and hence subject to parliamentary scrutiny and
disallowance, it is appropriate that restrictions on private ownership be
provided for in regulations.
5.48
The committee believes that it is appropriate to explicitly set out the
basis on which minority equity owners can request access to any information
provided by NBN Co to the Government.
Recommendation 18
5.49
That the NBN Co Bill be amended to explicitly set out the basis on which
minority equity owners can request access to any information provided by
NBN Co to the Government.
Matters not currently addressed in
the Bill
5.50
A number of submitters raised additional matters that they argued should
be addressed in the NBN Co Bill. Two key matters raised were:
- a need for additional provisions safeguarding consumer interests;[65]
and
- that provision be made for national training standards and the
development of national training and upskilling modules that will apply to
members of the future workforce that will construct and install the NBN.[66]
Consumer interests
5.51
Concerns about consumer interests – and suggestions for amendment to the
NBN Co Bill to address these – were made by the Australian Communications
Consumer Action Network (ACCAN). ACCAN made two primary suggestions:
- a proposal that the NBN Co Bill establish a designated consumer
representative on the NBN Board and establish a consumer advisory group;[67]
and
- that a regulatory instrument be adopted to ensure that wholesale
and retail service providers have clear responsibilities in resolving end-user
complaints;[68]
5.52
In oral evidence, ACCAN's representative, Ms Teresa Corbin, elaborated
on how current consumer groups and the Telecommunications Industry Ombudsman
are inadequately resourced to meet the needs of consumers in an NBN‑world
and that more formal arrangements between consumer interest positions and NBN
Co need to be established.[69]
5.53
The committee does not believe it appropriate to establish a designated
consumer representative on the NBN Co Board because it considers that such a
position could be difficult to reconcile with directors' duties to act in the
best interests of the company. However, the committee recommends the
establishment of a consumer advisory group along the lines of the Consumer
Consultation Forum. That forum is one to which the Australian Communications
and Media Authority is required to have regard when performing its functions.
5.54
Further, the committee believes the question of complaints handling is
one requiring urgent attention from the Government. It is deeply concerned by
the evidence it received that the Telecommunications Industry Ombudsman is overwhelmed
and ill-equipped to take on the additional workload that will emerge as the NBN
is rolled out and becomes operational.
Recommendation 19
5.55 That the Government establish a consumer advisory group dedicated to the
NBN. That the NBN Co Bill be amended to require NBN Co to have regard to the
advice of that consumer advisory group when performing its functions.
Recommendation 20
5.56 That the Government and NBN Co prepare a strategy to address how
end-user complaints are to be handled, and review the sufficiency of current
resourcing and processes of the Telecommunications Industry Ombudsman to handle
the expected future workload.
5.57
The committee addresses training of the future workforce deploying and
installing the NBN in chapter seven below.
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