Opposition would consider cancelling NBN Co vendor contracts

Opposition Leader Tony Abbott renews calls for NBN Co funding to be used on transport infrastructure

Opposition Leader Tony Abbott

Opposition Leader Tony Abbott

The Federal Opposition would consider cancelling some of the $7 billion worth of contracts signed between NBN Co and networking vendors upon taking power, Opposition Leader, Tony Abbott, has said in a radio interview.

According to Abbott — who would not be drawn on whether the Opposition would cancel the National Broadband Network and dissolve the NBN Co — said the Opposition was committed to “not throwing good money after bad”.

“Well, we’d have to look at exactly what the contracts entailed. We’d have to take legal advice, obviously,” he said. “But even if that money turned out to be wasted it would be this government’s fault not ours and, as I say, you don’t throw good money after bad…”

Abbott reiterated calls made in his reply speech to the 2011-2012 federal budget in May to use funds allocated for the NBN on building transport infrastructure.

“[The NBN funding] could build the Melbourne to Brisbane inland railway, that’s about $4 billion. It could build the Brisbane rail loop, that’s about $8 billion. It could finish the duplication of the Pacific Highway, that’s about $6 billion. It could connect up the M4 at Strathfield to the CBD in Sydney, that’s about another $6 billion,” Abbott said.

“It could build on top of that 20 major teaching hospitals at a billion dollars a throw and you’d still have enough change left over to spend the $6 billion that the Coalition was proposing to spend on better broadband at the last election.”

Abbott’s comments follow NBN Co’s striking of a deal with Australian construction company Silcar, a 50/50 joint venture between Leighton subsidiary Thiess and Siemens, to install the cable that will link premises to the network.

The contract — worth $380 million over the next two years, with the option of a further two years at an additional value of $740 million — will cover Queensland, NSW and the ACT, representing almost 40 per cent of national construction activity planned over the next two years.

Speaking in May Abbott argued speeds of up to 100 megabits were already “potentially available” to “almost every” major business and hospital, to most schools, and through high speed cable already running past nearly a third of Australian households.

“The smart way to improve broadband is not to junk the existing network but to make the most of it,” he said. “It’s to let a competitive market deliver the speeds that people need at an affordable price with government improving infrastructure in the areas where market competition won’t deliver it.”

Follow Tim Lohman on Twitter: @Tlohman

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