Audit finds flaws in mobile blackspot program

Round one did not sufficiently target expansion of mobile coverage

A report from the Australian National Audit Office has criticised some elements of the government’s mobile blackspot program (MBSP). A key flaw of the program was that its first round “did not sufficiently target funding toward the expansion of coverage where coverage had not previously existed,” the audit found.

The government in June last year announced that Telstra and Vodafone would receive funding under the $100 million first round of the blackspot program.

The first round covered 429 Telstra base stations and 70 Vodafone base stations and according to the government would deliver mobile coverage to 68,600 square kilometres. Telstra received funding of $94.8 million, while Vodafone was awarded $15.2 million (including GST).

In addition to the federal funding, the round included $275 million in co-contributions (from state governments and third parties in addition to the telcos).

In February the government launched a $60 million second round. The Coalition pledged a further $60 million for a third round of the program during the election campaign.

The first round of the funding “has resulted in substantial consolidation of existing coverage provided by grant applicants, as opposed to extending coverage in new areas—a key objective for the programme,” the ANAO report stated.

The Department of Communications, which administers the program, “appropriately identified black spots to guide the location of proposed base stations to be funded under the MBSP through its Database of Reported Locations, which listed over 6000 publicly nominated areas with partial, poor and no mobile coverage,” the report stated.

However it added: “The approach taken to promote the programme across targeted electorates was not, however, consistently conducted and this may have had an impact on the distribution of nominations across electorates.”

Forty six of the 499 base stations funded by the first round of the program “provide no new coverage to either premises or major transport routes,” the report stated.

“A further 43 selected base stations did not provide enough coverage to qualify for a single point against the selection criteria for coverage benefit. These 89 base stations have a total cost to the public of $28 million in Commonwealth and state commitments, including Commonwealth funding of $18 million.”

"The department notes the ANAO's observations regarding the extent of new coverage being delivered by the base stations,” a response from the Department of Communications said. “The department is of the view that extending new coverage is just one of the aims of the programme and that the mobile telecommunications infrastructure being funded through the programme also achieves the programme's objective of providing the potential for improved competition.

“Clearly, the number one criterion for site selection was politics, not community need,” said a joint statement issued by the shadow minister for communications, Michelle Rowland, and the shadow minister for regional communications, Stephen Jones.

The Labor MPs’ statement said that “more than 80 per cent of the locations for new mobile phone towers announced are in Liberal or National electorates with less than seven per cent in electorates held by Labor members.”

The Auditor-General also found that the Department of Communications, which administers the program, “did not establish appropriately structured methodologies to inform the technical and financial assessments of applicant proposals”.

In addition the report said that the department’s ability to measure the effectiveness of the program “will be difficult given the absence of a fit for purpose performance measurement and evaluation framework for the programme”

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