Coalition Minority Report: Infrastructure and Communications Committee Reoprt on NBN

I am pleased to speak on the recent report of the Standing Committee on Infrastructure and Communications concerning the role and potential of the National Broadband Network, a report which rejoiced under the title Broadening the debate but which could have been better entitled Sticking to the line, because that is what government members sought to do in the conduct of this inquiry.

When you consider the matter, it is a remarkable proposition that an inquiry into the role and potential of the National Broadband Network should have commenced in late 2010, after the government announced its decision in April 2009, over 18 months earlier, to spend $43 billion on a national fibre-to-the-home network. It is really quite remarkable that so little detailed work had been done in advance of that April 2009 decision and that it took until the end of 2010 for the government to think it was worth while to establish an inquiry into the things that might actually be done over this $43 billion network.

One of the very clear conclusions that emerged from this inquiry is that very little work had been done by the major departments of government in advance of that decision being taken in April 2009—a decision that represented a complete reversal of the Labor government's previous broadband policy, which, as members would no doubt recollect, was to spend not $43 billion but $4.7 billion and to have not a fibre-to-the-premises network but a fibre-to-the-node network. I was therefore interested to ask witnesses from a number of departments about the nature of the advice they must surely have given this government in the first part of 2009 in advance of that dramatic change in policy. Remarkably, very few of them were able to provide any compelling evidence that they had even been consulted, let alone given detailed and compelling evidence. It was interesting to note that the Australasian Telehealth Society gave evidence that they had not been consulted at all in advance of that decision, although we are repeatedly told that telemedicine is a justification for the National Broadband Network.

This report was the wrong kind of inquiry at the wrong time. It was a highly political exercise designed to generate a feelgood report offering support for the rollout of the National Broadband Network. As I have already indicated, it occurred after the decision to spend the money rather than before, and it was not structured to be an effective analytical exercise. It should have been structured as a cost-benefit analysis. Instead, it was merely a shopping list of benefits without any consideration of cost.

It is certainly the case that there were a number of extremely interesting and impressive examples of the way in which broadband can deliver benefits in health, in education and in other sectors. But this has never been in dispute. What is in dispute is the right way to secure those benefits—what kind of networks are required to deliver them and who should own and operate them? One of the standout conclusions from this inquiry, which went around the country and heard from a significant number of witnesses, is that there were very few persuasive examples given of applications which actually require the speeds that the National Broadband Network is being engineered to deliver. If 100 megabits per second is something that is of such vital importance that we should spend $43 billion—or, in reality, a number which now looks likely to exceed $50 billion—then what is to be delivered that requires these speeds as opposed to, for example, five megabits per second or 10 megabits per second or 15 megabits per second?

What is remarkable is that the examples that were repeatedly given did not require NBN type speeds. At paragraph 3.53 of the majority report there is a discussion of the remote home monitoring application, developed by Intel and GE Care and used in the Hunter nursing trial last year. This is an impressive application. It is a very sensible use of broadband—to put remote monitoring devices in patient's homes so that rather than requiring a visit from the nurse every day instead the patient's condition can be monitored remotely. There is no dispute that that is a sensible thing to do. What is in dispute is whether you need 100 megabits per second to deliver that application. In fact, what we were told, is that you need 512 kilobits per second, Mr Deputy Speaker, and you, I am sure, would not need my assistance to do the maths. That is 1/200th of the speed that the NBN is going to deliver.

At paragraph 5.28 of the majority report there is a discussion of smart grids—that is to say, electricity distribution networks which contain smart meters at the customer end which feedback data about electricity usage in real time. Again, it is a very sensible application. There is no dispute about that. But is there any discussion at all of the fact that smart meters in fact use quite limited bandwidth? There is only the most cursory discussion with language buried deep in paragraph 5.28: 'Individual smart meters do not require high bandwidth in themselves.' That is absolutely right, they do not, so why are they being rolled out as a justification for building a 100 megabit per second network using taxpayers' money?

I could cite—indeed, I will cite—the discussion of agricultural sensors at paragraph 5.35 and following in the majority report, which fails to disclose that the data requirements for such sensors are quite low, as the witness, Mr Robert Walker of AgForce agreed readily when he was asked, 'Isn't it the case that the bandwidth requirements for agricultural sensing is quite low?' 'Indeed, it is.'

After all this exercise what we have found is, unsurprisingly, there are many good things that broadband can do. That is not in dispute. But there was very little persuasive evidence given of the applications that in fact require 100 megabits per second or anything like it at this point. What was also extremely troubling was that the central premise of the National Broadband Network policy that there is overwhelming and immediate demand for fibre to the home is clearly wrong. It is evident from the poor early take-up, from the relatively poor response to the inquiry, from the relatively limited number of submissions and from extensive evidence that we received that many stakeholders are not that interested or engaged.

Again, let us be clear: there is no dispute on this side of the parliament that upgrading Australia's broadband infrastructure is a worthwhile thing to do. But what we have not seen is the evidence that this enormously expensive network configuration, involving 100 megabits per second fibre direct to the home to some 10 million premises, can be justified, as opposed to the many available options which would be substantially less expensive.

On a related point, we heard a lot of evidence about the value which may be achieved from connecting, for example, all schools, all hospitals, all libraries or all clinics. But I merely make the point that there are only 10,000 schools in Australia; there are fewer hospitals. The numbers involved to connect selected categories of institutions, as opposed to this government's enormously expensive policy of connecting 10 million premises, would be fewer and very much more cost effective.

The final point I wish to highlight to the parliament in the brief time available to me is that we were, again, struck by some of the very nasty side effects of this government's National Broadband Network policy through the establishment of a government owned monopoly. This policy will suppress competition and hand enormous power to the management team of the National Broadband Network Company, and that is not in anybody's interest.