NBN service plans won't cost consumers more: Conroy

Senator responds to Tony Abbott’s speech on costly NBN plans

Minister for Broadband, Communications and the Digital Economy, Senator Stephen Conroy.

Minister for Broadband, Communications and the Digital Economy, Senator Stephen Conroy.

Senator Stephen Conroy has slammed Opposition leader Tony Abbott’s comments that National Broadband Network (NBN) services could cost consumers more than current ADSL plans, saying Abbott was “plain wrong” “and that he should “check his facts.”

The minister for broadband, communications and the digital economy said in a statement that Abbott had misled the public in his speech to Parliament by saying that NBN services could be three times higher than what they currently pay for existing ADSL plans.

"Why spend $50 billion on a National Broadband Network so customers can subsequently spend almost three times their current monthly fee for speeds they might not need?" Abbott said.

“Why dig up every street when fibre to the node could more swiftly and more affordably deliver 21st century broadband?

“And why put so much into the NBN when the same investment could more than duplicate the Pacific Highway, Sydney’s M5 and the road between Hobart and Launceston; build Sydney’s M4 East, the Melbourne Metro, and Brisbane’s Cross City Rail plus upgrade Perth Airport and still leave about $10 billion for faster broadband?”

Conroy said that prices for NBN plans released to date are cheaper than, or equivalent to, existing ADSL plans, but with much improved quality of service.

"Internet service providers such as Skymesh are offering NBN services from $29.95 per month while Exetel’s entry-level plan costs $35.00 per month," he said.

“A number of other retail providers, including Optus, offer NBN services starting from $39.95 and $49.95 per month. Thanks to the NBN, competition between retail providers is increasing,” Conroy said.

“Tony Abbott should check his facts before delivering a national address in the Australian Parliament.”

Conroy also responded to Abbott's comment that investing in the NBN should be replaced by additional spending on roads.

“Mr Abbott clearly doesn’t understand that the NBN is classified by international accounting standards as an equity investment rather than a budget expense,” he said. “The equity investment in the NBN cannot simply be shifted to pay for more roads, unless those roads are being run by a government business making a return.”

He added that the Government has a $36 billion infrastructure and investment program, including $3.6 billion announced in the 2012-13 Budget to complete the duplication of the Pacific Highway by 2016.

Earlier this month, Conroy hit back at statements by Shadow Minister for Broadband, Communications and Broadband, Malcolm Turnbull, that the Labor government “cooked” the books for the Budget 2012-13 by shifting $1.5 billion worth of expenses forward from 2012-13 to 2011-12, including a lump sum payment of $421 million to Telstra to the current financial year.

“Inducements provided to Telstra for its deal with NBN Co have been brought forward as lump sums totalling $421 million to be paid out before June 30,” Turnbull said at the time.

Conroy said that the payment to Telstra was part of $11 billion definitive agreements made on 7 March 2012 with NBN Co giving the final go-ahead for Telstra's structural separation and use of its network assets in the NBN.

“There is nothing new about these payments nor can they be described as having been ‘brought forward’,” he said.

Turnbull also said that the NBN price tag had risen by as much as $400 million. He said this was evident in the government's broadband spending which is forecast to hit $484 million in the 2012-13 Department of Broadband, Communications and the Digital Economy (DBCDE) portfolio budget compared to $57 million in the 2011-12 DBCDE portfolio budget.

“The sum Australian taxpayers are being forced to invest in the NBN between July 2011 and June 2014 has apparently blown out by $400 million, even though the NBN is at least a year behind schedule in its rollout,” Turnbull said.

“Yet the network only has 5000 or so customers currently using its fibre network, compared to the 137,000 projected by June 2012 in NBN Co’s corporate plan.”

Follow Hamish Barwick on Twitter: @HamishBarwick

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