Curran Clare: Financial Review Debate — In Committee 
Text is incorporated into the Bound Volume 
Curran Clare: Financial Review Debate — In Committee 
[Sitting date: 12 March 2013. Volume:688;Page:8433. Text is incorporated into the Bound Volume.] 
CLARE CURRAN (Labour—Dunedin South) 
: 
 Thank you Mr Chair. I raise a point of order Mr Chairperson. It appears that the microphone is not working. 
The CHAIRPERSON (Eric Roy) 
: No it is working and it is going out on television. It is the audio in here that is kind of struggling which is why I have suggested that we recognise the situation a little bit. So you are live and you are on air. 
CLARE CURRAN 
: I am very happy to do that. 
The CHAIRPERSON (Eric Roy) 
: You can hold another one if you like as well. 
CLARE CURRAN 
: If it is working—it is not working. 
The CHAIRPERSON (Eric Roy) 
: If you come close to the mike. 
CLARE CURRAN 
: There is another debacle that is happening on the Government’s very doorstep that is the Government’s own doing and that is poised to explode in its face. It is a debacle of economic development—of the economic development that was promised in 2008 when National won the election when it became the Government. It was going to be the step change in our economy—Steven Joyce’s ill-thought-out ultra-fast broadband scheme John Key’s grand ultra-fast broadband idea Chorus’ inability to deliver on the ultra-fast broadband scheme and Crown Fibre Holdings’ negotiation of the contract between the Crown and Chorus to build the $1.5 billion taxpayer scheme. It has been botched. It is a giant stuff-up—it is a giant stuff-up and they know it. 
Just before Christmas the Commerce Commission announced a draft decision and a well-signalled review of the way that the wholesale price of copper broadband is calculated to one based on the actual costs for the services to be provided. It was well signalled. It dropped the wholesale price per line per month from $21 to almost $9. But the problem for the Government is that people are not taking up fibre and they are not moving across to fibre. As a result Chorus held that its drop in income on its copper network would undermine the company and that it just could not keep on building the Government’s fibre network. So how did this happen? How did we get to this point? How did Chorus not know that this was likely? The telecommunications companies did. How did the Government not know? Now we see the Government’s much-vaunted broadband scheme coming unstuck and the Government does not know what to do about it except to try to stick its finger in the dyke. It will do this by bypassing the Commerce Commission. “Forget about them.” it said. “They don’t matter. Let’s change the law.” said John Key. He said it twice before Christmas and one of those times was in this House. 
Ross Patterson is the former Telecommunications Commissioner for the Commerce Commission. He was respected and highly regarded across the industry and in Government circles. He has described the Government’s response as unprecedented. He said: “It is a fundamental principle of our telecommunications regulatory regime that the regulator is independent and is left to carry out its statutory role without interference or undue influence from the Government.” He said the Government had crossed that line. Does that sound familiar? Think of the Skycity deals; think of the $43 million loans to MediaWorks; think of the change of law to suit Warner Bros in making  
The Hobbit 
 in New Zealand; think of the conflicted role of Stephen McElrea the Prime Minister’s electorate chairman on the board of New Zealand on Air; and think of the Prime Minister’s knowledge of and involvement in the illegal surveillance of Kim Dotcom by the Government Communications Security Bureau and the FBI. This Government will do what it likes. It will abuse the law. It will abuse the contract processes. And if it does not like the law it will change it. It will ignore it or it will change it and then pretend it cannot remember or it does not really matter. 
Two years ago Steven Joyce forced through changes to the Telecommunications Act to allow Chorus to be given $1 billion to roll out the bulk of its ultra-fast broadband network. Labour opposed many of those changes and the bill in its entirety because it considered that the Government was using a law change to allow it to favour one business over another in awarding a huge taxpayer-funded contract. There were two major bidders: Chorus which was part of Telecom and Vector the Auckland-based electricity lines company. Chorus won the job as we predicted it would not because it was the best bidder but because the Government had already decided that it would get the job. Chorus knew the terms and conditions of its contract. It was well signalled at the time that there would be a review of the copper pricing system by the Commerce Commission by 2014. It was well signalled that copper prices would fall. And what happened? We are now into the fifth year since this Government was elected. Just 3806 households have been connected. Not one major telecommunications company has announced a retail package to attract people on to fibre. 
Report noted.