Democrats to oppose Telstra sale as search begins for a new CEO

The Australian Democrats has not changed its position on the full sale of Telstra and will continue to oppose any moves by the federal government to sell its remaining 51.8 per cent stake in the telco.

As the Democrats incoming leader, Lyn Allison was emphatic her party would maintain its opposition to the sale despite her colleague Senator Andrew Murray indicating he would support the government in a speech to parliament.

Although Treasurer Peter Costello has not confirmed when the government will introduce legislation allowing the sale to go ahead, speculation is mounting the government will push ahead the privatisation of Telstra when it takes control of the Senate in July.

"We've made it very clear. Andrew Murray has said in the past, and no doubt believes now, that with certain conditions there might be an argument for selling Telstra, but those conditions are not likely to be met by this government," Allison said.

"I doubt they would take any suggestion seriously, that they would be inclined to look at it."

Senator Allison was critical of the reported $2 million payout to Telstra chief executive Ziggy Switkowski.

"I'm more interested in the fact that Ziggy Switkowski is being paid over $2 million in an executive payout, which is way beyond community standards," she said.

Rural Australia, she said, would be the big losers if the telecommunications giant was sold.

Responding to Switkowski's resignation yesterday, the Treasurer expressed full confidence in the Telstra board.

Dr Switkowski left his post two years before his contract was due to expire and his departure followed that of Telstra chairman Bob Mansfield earlier this year.

Analysts have criticized the telco's failed expansion strategy in Asia and apparent inability to substantially grow its domestic market share, and did not see him as the man for the job when it came to handling the sale of the government's majority share in Australia's biggest telco.

Commenting on Switkowski's replacement, Costello said he had a preference for an Australian.

"Naturally I'd prefer an Australian to run a big Australian company - I think we've got very talented people in this country," he said.

"But having said that, if the best person is a person that's currently overseas, then the board should consider that as well."

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