Ardern Shane: Telecommunications Amendment Bill — First Reading 
Ardern Shane: Telecommunications Amendment Bill — First Reading 
[Volume:632;Page:4088] 
SHANE ARDERN (National—Taranaki-King Country) 
: 
 National will support the Telecommunications Amendment Bill going to the Finance and Expenditure Committee. I start by saying that this would have to be the biggest bungle ever made by any Government ever—that is the announcement and the handling of the announcement of this bill. That having been said—and the fact that the way it was handled in my view contributed substantially to the amount lost by mum and dad investors “Joe Hard-worker” investors in Telecom as a result of that announcement—let us address a few of the points on which we do agree. 
One is that the whole structure of telecommunications in this country has not lived up to and met the demands of a growing commercial sector. So let us agree on that. That is a fact and we need to do more in that regard. We need to enhance our broadband access and the speed of it and investment therein. Let us also agree that in a modern economy business is highly dependent on these forms of modern telecommunications and if we want to see New Zealand get back into the top half of the OECD as the Prime Minister has said on many occasions then we need to do something about the state of that infrastructure. 
 But the area where we totally disagree and where I have a huge amount of anxiety—I am speaking in the House this afternoon in favour of the introduction of this bill and its referral to the select committee but with anxiety—is the area of property rights which the previous speaker touched on. We cannot send a signal to the international investment community that if an autonomous company—a company that runs its own business—is not run in the way the State likes then the socialists will step in and say how it must be done. We cannot do that; that is the worst thing any Government can do in terms of encouraging investment. 
Let us do away with some of the myths that have been built around this debate. One of the myths is that Telecom is some multinational corporation acting in an uncompetitive way in the telecommunications field and it needs to be dealt with. This may surprise those on the other side of the House who of course have much smaller minds when it comes to business affairs but Telecom is a minnow. Telecom is a very small telecommunications company on world scale. If the large telecommunications companies in the world with all of the modern technology that has been available to them for a long time could not come into New Zealand and make that alternative technology viable on a commercial footing without tapping into yesteryear technology—the old copper wire infrastructure—then how do we imagine this legislation will now encourage them to do that? I ask that question. 
I also raise a major question—and I welcome the Minister for Rural Affairs to the House—with regard to telecommunications for isolated rural areas out there where telecommunication is more important than it is anywhere else. I need to remind the House once again—we keep saying it over and over—that that is the heartland of this country the heartland of the economy. That is the area where the greatest economic gains could come from. I will make a prediction now and I invite members to look up  
Hansard 
 in a few years’ time pull it out again and tell me whether I am right or wrong. I think this move will slow down the investment in that area short term. I also think it will create extra costs in that area in the short to medium term. Long term will it overcome the problem of what has now become a historic agreement which is the old Kiwi share? 
I think we probably should remind ourselves in this debate of how this structure came about. It came about through the sale of this country’s post office and telecommunications structure by the former Minister for State-owned Enterprises the Hon Richard Prebble who was a Labour Minister of course at the time. When that happened the Government put in place a regulation that was known as the Kiwi share. It required Telecom to maintain its copper wire infrastructure at 1989 levels. The incoming Helen Clark Labour Government in about 2000 looked at what had happened with regard to the Kiwi share structure and decided to revamp it. It went through a major consultation process at that time and I believe that in the ensuing 6 years something like 69 different reports were produced. That was typical of this Labour Government—get another report put it on the shelf and do not take any notice of what it says. Then finally by accident the new Minister fumbled around and stumbled out with this announcement. 
I say to the House that I have some major concerns. I hope the members on the Finance and Expenditure Committee will listen with an open mind. I say to them—and to the chair of the select committee—that they should listen with an open mind to all of those who submit and have a look at international experience. I tell them not just to make up their minds that “we know best” and the State will always get it right. They should have a look at what has happened internationally in countries that have similar geographical problems to ours like Australia which is our nearest neighbour and other nations around the world like the US and see what they have done. They should have a look at what has worked and what has not and come back to this House with legislation that may—and I emphasise the word “may”—help to enhance our telecommunications in this country. 
We are I understand 22nd out of 30 countries in the OECD in terms of our access to broadband. Is that not an indictment on this Government which claims to have been a business-friendly proactive Government with regard to getting things done? We are 22nd out of 30 countries in the OECD. I ask another question. Why in 2003 did the Telecommunications Commissioner Douglas Webb come back to the Government with one of the 69 reports and say that introducing regulation to allow access to Telecom’s infrastructure would not work? Why did he do that? On what basis did he make that decision? Can we say with any certainty here today that what is happening or is about to happen will bring about the panacea as it were that this Government claims it might? 
Telecom has announced in the last few days that it is looking at splitting its telecommunications infrastructure—that is the copper wires infrastructure—from the rest of the business. I think that is to be encouraged. I do not know whether that will enhance what is being proposed by the Government but I think it is a good step. 
Shane Jones 
: Not on their own free will. 
SHANE ARDERN 
: I look forward to hearing from the member who is interjecting when he gets to the select committee and some facts are presented to him. I look forward to his taking on some of these major telecommunications providers and telling them straight pan-faced that they are wrong and he knows best. Those people have invested millions of dollars in this area and I think they would have done some pretty robust analysis of what works and what does not work. 
The major concern however having said all of that is that at the end of this process the major digital divide as I and others have taken to calling it between rural and urban New Zealand is able to be closed. It is absolutely essential for this economy that that happens. It is essential not only from an economic point of view but also from an educational point of view. 
Major parts of the economy out there still do not have basic access to broadband and Internet connections. The fact that we are still trying to find ways to push more of that information down a 1989—or even older in some cases—kind of technological structure is absurd. Of course when that technology was put in place we did not yet have Internet access facsimile access or that kind of thing; we were talking about analogue rather than digital information exchange. The fact that there is new technology now to enhance that situation is a great thing but we just need investment in that technology. I say to the Government that it will have to look seriously at what happens with regard to that rural infrastructure and there may well be an argument that can be put forward for some kind of cross-subsidy for doing that in a socially responsible way. 
I look forward to the findings of the select committee. We support this bill going to the select committee.