Curran Clare: Telecommunications (TSO Broadband and Other Matters) Amendment Bill — Third Reading 
Curran Clare: Telecommunications (TSO Broadband and Other Matters) Amendment Bill — Third Reading 
[Volume:673;Page:19686] 
CLARE CURRAN (Labour—Dunedin South) 
: 
 In 2008 this Government was elected on a promise—a fairly big promise. It was No. 2 on its pledge card to the New Zealand public and it was to deliver ultra-fast broadband to 75 percent of New Zealanders in their homes in 10 years for $1.5 billion. The National Government is pushing through this bill the Telecommunications (TSO Broadband and Other Matters) Amendment Bill because it wants to satisfy that election promise—a promise that should not have been made cannot be delivered and can be met only by selling the law which is what it has done. 
The Minister for Communications and Information Technology has spent 2½ years trying. This was after he cut the Labour Government’s digital strategy which clearly set out a vision for New Zealand’s future as a digital economy and how broadband would be incorporated. Despite this lack of vision from the Minister he has not at any stage requested analysis or advice from Treasury or the Ministry of Economic Development on the benefits and costs of this bill. Even the ACT Party could not understand that. Roger Douglas was quite right to say that “This Bill has been driven by a political imperative rather than an economic one.” 
Labour believes that New Zealand’s digital environment requires high-speed broadband across urban and rural New Zealand delivered in a realistic time frame at an affordable cost and in a competitive market. Before the last election a plan was in place and there was solid policy around progressing it quickly and there is more coming. This bill before us today does none of that and that is why we are opposed to burdening all Kiwis with this flawed legislation. 
Labour would have approached the fibre roll-out in urban areas differently. The process has lacked transparency. It is full of gaps and holes and we do not believe that the full costs and impacts have been made public. The interests of investors and corporates have been put ahead of the interests of New Zealand consumers and ahead of a strong and vigorous competition in this new and emerging network industry. There has been a lack of public and cross-party consultation. The window for public submissions was very short making it nearly impossible for detailed submissions to be made considering the complexity of this legislation. 
The negotiations with Telecom have been shrouded in secrecy. We are yet to find out the real details of Telecom’s structural separation. It is a huge change but by the time we do find out it will be too late to do anything about it and to have public scrutiny and discussion. The bill will have become law. Secrecy dubious decision-making and the marginalisation of the democratic parliamentary process seem to be the theme of this bill. What we do know about it is that it will create an uncompetitive market that could entrench Telecom2 and Chorus2 as the dominant players at the infrastructure wholesale and retail levels in the New Zealand fibre market. 
Telecom’s history of monopolistic behaviour will not change when it is broken up under the structural separation especially now that the Minister has guaranteed it that any costs incurred by Commerce Commission regulation will be worn by the taxpayer—an indemnity to Telecom; that is truly selling the law. What incentive will this give Telecom to behave competitively? What incentive will it give the Minister to regulate when the Crown will be bearing the cost? Once again the Minister is proposing law that just will not work; law that will increase the cost to the consumer while creating an anti-competitive market. 
Only minor definitional changes were made during the drafting of this bill. It was only after huge opposition from Labour MPs and the telecommunications industry that the Minister conceded that the major component of his bill the 10-year regulatory holiday had to be changed in order to receive enough support from the Government partners and to receive grudging support from the industry. When the amendment was tabled in the House we saw other changes that were new and very late. They were put up without the possibility of discussion. 
This is the Minister who did not know earlier this week that under his watch New Zealand’s broadband performance has seriously declined in relation to other countries since his Government took power. OECD statistics show that monthly prices in New Zealand have slipped from the seventh cheapest to fourth most expensive since 2008. We have gone from 12th to 21st for download speed and 12th to 24th for connection speed since his Government took power. He obviously does not keep tabs on New Zealand’s international competitiveness but he is blindly insistent on ramming through an anti-competitive law which hands a large amount of money to Telecom. 
We also know that this bill will be forcing prices up for urban users despite what he says through the averaging of unbundled copper pricing. While these users wait for fibre—which as the Minister himself has said could take at least until the end of 2019; even later for many New Zealanders—they will be paying more for the broadband services that they receive now. Is that fair at a time when household budgets are most stressed? We should not be surprised—this is classic behaviour by a National Government that is out of touch with the average Kiwi. 
Only a few days ago the Minister put forward an amendment that appears to do away with the Kiwi share obligation for Telecom. So at the last minute the Minister has sprung upon us an amendment that essentially opens up part of the separated Telecom to full foreign control. The old restrictions on foreign ownership will no longer apply to the retail arm of the split-up Telecom and the Kiwi share obligations will be split between Telecom and Chorus. Where that split will be and what the implications are for the New Zealand consumer are unclear. The Minister will not tell us and there is no chance for public scrutiny. 
Labour had a plan that would have been well on the way to completion by now. We want a high-tech economy run on ultra-fast broadband. We want to use technology to improve the responsiveness of the Government. We want to ensure that all users whether they are rich or poor rural or urban have access to the latest broadband services and we want to ensure that those services are provided as cheaply as possible in a competitive market. It is a shame that this Government and the Minister for Communications and Information Technology do not agree with those principles. 
This Government does not care for the average New Zealander; it cares only for those with money while doing deals. That is why Labour opposes this bill. We will repeal the worst parts of the legislation when we are returned to Government. We will review it and restore regulatory oversight. The Commerce Commission will have full powers to examine the contractual arrangements between the Crown and private investment as would happen in the normal course of events. Any consequences arising from this would be borne by the parties concerned. 
One of the things missing from this debate is the reason why people will connect to fibre to high-speed broadband. It seems that Steven Joyce the Minister in his obsession with fulfilling the election promise—a promise that could not be fulfilled with that amount of money—and devising a deeply flawed connection scheme left that bit out. “Build it and they will come.” was his argument. Will they? Content is the important issue and demand is about what people can use the high-speed broadband connections for and what would motivate them to switch from copper to fibre. 
Steven Joyce is not interested in a bigger vision and he is strangely silent on any consideration of how the content industry fits into it. The traditional broadcasting sector is transforming and merging with what has been described as the telecommunications and information and communications technology sector. Increasingly content and the digital environment cross technological platforms. Traditional broadcasting as we know it is now rapidly becoming obsolete. It is called convergence but we have not heard the Minister talk about that. 
New Zealand’s new broadband network will be successful only if people choose to access it and see its potential for the future. To do that they need access to quality and diversity of content from both within New Zealand and without. New Zealand’s broadcasting sector does not currently encourage competition and it lacks that important public television broadcasting function. The current commercial market framework is not delivering that as it lacks a publicly funded component. 
Our concern is about what is coming next. A dominant player is being set up in the fibre industry to deliver the infrastructure with virtually a free pass to price gouge its way through the next decade. Are we going to see a bigger monopoly in the broadcasting sector be given a gold-plated distribution channel into people’s homes? If that is the future for broadcasting fibre delivery in this country—a Telecom-Sky partnership—then today is a truly sad day for this nation.