Telstra sale to head back to Senate

The House of Representatives has again passed legislation that allows the Federal Government to sell its share of, and subsequently privatise, Telstra.

The legislation is now due for consideration by the Senate before it can be approved. The Senate blocked similar legislation in October 2003.

The Government has immediately gone into sales mode, releasing a statement urging the Senate to swing in favour of privatising the telco giant. “Selling the balance of the Government’s shareholding in Telstra is in Australia’s national interest,” Department of Communications, Information Technology and the Arts Minister, Senator Daryl Williams, and Finance and Administration Minister, Senator Nick Minchin, said in a joint statement.

The Government claims that its telecommunications reforms have introduced both a more competitive landscape and better telecommunications services to the Australian public.

It credits its effort in implementing the Universal Service Obligation (USO), the Customer Service Guarantee (CSG) and the Network Reliability Framework (NRF) initiatives as proof that it has created an environment whereby Telstra must perform satisfactorily no matter who owns it.

“These obligations are enshrined in legislation and are not affected by any proposal to sell Telstra,” the Government said. “In addition to the USO, CSG and NRF, the right to untimed local phone calls, price controls and the Telecommunications Ombudsman will be maintained in the future.”

“It is disappointing ... that the Opposition continues to try to scare Australians into believing that telecommunications services in Australia are inextricable linked to the Government owning Telstra,” the statement said. “This is patently not the case.”

Regardless of its sales pitch, the Government is likely to face strong opposition to the sale legislation.

A spokesperson for ALP shadow minister for Finance and Consumer Affairs, Lindsay Tanner, said that the Howard Government’s moves in the House of Representatives disregarded the views of an overwhelming majority of country Australians.

“The Howard Government’s Telstra sale bill will allow Telstra to become a huge private monopoly too powerful for any Government to effectively regulate,” the spokesperson said. “A fully privatised Telstra will leave town faster than the banks. Country residents will never have any hope of getting telecommunications services on a par with city residents if Telstra is privatised. Already many regional Australians are finding broadband is too expensive as satellite is their only option. Things will only get worse if Telstra is privatised.”

The Democrats have also indicated that they will oppose the sale.

With this being the case, the Government either needs to convince the Democrats to back flip on their view of the sale, or convince four independent senators to support the bill, in order to complete the sale.

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