Hughes Gareth: Telecommunications (Development Levy) Amendment Bill — First Reading Second Reading In Committee Third ReadingText is incorporated into the Bound VolumeHughes Gareth: Telecommunications (Development Levy) Amendment Bill — First Reading Second Reading In Committee Third Reading[Sitting date: 21 May 2015. Volume:705;Page:3702. Text is incorporated into the Bound Volume.]GARETH HUGHES (Green): Kia ora Mr Deputy Speaker. Ngā mihi ki a koutou kia ora. I rise to support the Telecommunications (Development Levy) Amendment Bill. This is a pretty uncontroversial bill and it should be. It is simply keeping the telecommunications development levy where it is. You could argue it is marginally increasing it but look it is keeping it where it was—at $50 million. This increase is for $100 million to spend on Rural Broadband Initiative 2 and then $50 million on a contestable mobile black spot. It is fulfilling a governmental election policy. We are disappointed with the process. We think it could have gone through a select committee. There is no reason to pass this bill through all stages today on a Friday afternoon or early evening. The fact is that the Government has sat on its hands when it comes to this issue since that election promise. When it comes to actual industry involvement the Government’s own officials advise that no one in the industry was consulted and in fact the officials then go on to say that at least they will get a parliamentary process to give their input which we will not see given this bill is passing through all stages. It is unfortunate that we are seeing this pass in the way that it is. The second unfortunate aspect of this is that this is an area that the Government is currently consulting on—it is currently consulting on it. So at the same time it is passing legislation through all stages in a single day under urgency it is asking the public and the industry to consult on the process for spending. It seems a bit like the horse after the cart.I raise these issues because I think that a critical question this Parliament needs to ask itself is: given the questions around the original Rural Broadband Initiative what we do not want to see is simply a cut-and-paste job with this extra $150 million for Rural Broadband Initiative 2. That is why I support greater industry and public input and a better process. But I am supporting this bill because of the importance of the internet to our rural communities in terms of social cohesiveness in terms of health outcomes and in terms of regional economic development. We know that the internet plays a critical role for our communities and we have been hearing about those communities on the Commerce Committee—from Outram from Mosgiel and from a host of communities that have not been able to access ultra-fast internet to date—and how it is holding their communities back. I have a vision that kids in rural schools can access the world’s best educators via the internet. Our farmers who are using data to increase their productivity can do so more and sell their products around the world.When it comes to the internet it breaks down some of the strategic challenges our country faces. There is a limit to how much milk powder we can export around the world. In fact we are seeing it in our streams and rivers at the moment. There is no limit to the amount of intellectual property services new ideas and entrepreneurialism that we can be exporting across the internet cables. As the Government is now with this legislation set to spend more than $2 billion on internet access over the course of its term we have to ask ourselves whether we are simply just building an ultra-fast intranet. We also need to focus on those international conventions which is something the Green Party has pushed. So rural broadband is good for farmers it is good for kids and it is good for our rural communities. It lessens that digital divide which we know is based both on income but also on region.Disappointingly when you look at the original Rural Broadband Initiative though the Government cannot point to a comprehensive economic evaluation of its outputs. This is important because we know that a lot of our communities are not able to access ultra-fast internet particularly in rural regions. The Government is able to point on paper to the amount of potential connections but I think for many communities that sounds and rings hollow. They want to know how many people are actually connected. We can do this for the ultra-fast broadband project but not for the Rural Broadband Initiative. We should be measuring this stuff. We should be getting value for money for spending $300 million to date and the additional $150 billion the Government is now wanting to spend. It is important to invest this money. We saw from the report by Hayden Glass and others from the Sapere Research Group that providing greater internet access and use of the internet by our businesses could deliver $34 billion in economic benefits. We can see our regional economies thrive. I will not name the person but I know someone down south who literally is managing a network of global satellites for climate change research and managing assets worth hundreds of millions of dollars yet this person is able to live in picturesque central Otago. We know that there are a lot of people who would love to come to live in New Zealand and we need to attract the quality of those who want to live here by our quality of life. So let us build up our regional communities. Let us offer them good internet access.I would like to touch on some of the questions and concerns. We have heard some of them from the Labour Party members. I think there are three big concerns around the evaluation of the reporting around the role that Vodafone has played to date but also around an expectation gap. So let us look at the effectiveness of the original Rural Broadband Initiative. It was a $300 million investment. It is incredible that the Government cannot point to a comprehensive evaluation. I think when you are spending such significant sums of taxpayers’ money it is prudent and reasonable to be able to ask those questions. We are seeing a market failure in our regions. Obviously the big telecommunications companies are not rolling out ultra-fast broadband to the level they are in our cities and you can understand that. That is why everyone I believe in this House thinks it is eminently reasonable for public subsidies to rectify this market imbalance to provide internet access to our communities. So a subsidy is valid but look taxpayers want to know whether their money has been spent in a cost-effective manner. They want to see the benefit-cost ratios.The Government does not ask these questions basically because the asset infrastructure it is installing is open access and anyone can use it. But I think that rings hollow. I think that the Government—and I place the blame squarely at Steven Joyce’s feet—should have made this a requirement of the contract. Look if the Government is going to spend $300 million of the money of telecommunications companies’ customers ultimately it should be able to at least say how many people are connecting as they can for the ultra-fast broadband. Do not just take my word for it; we have seen Chris O’Connell of the Telecommunications Users Association of New Zealand write in August last year around some of the questionable Rural Broadband Initiative spends. He writes: “my recent travels have shown me that the RBI has yet to make a real impact and even when it is available it’s is decidedly average in its performance because it is basically delivering last decade’s broadband at best and often less than our innovative regional wireless ISP’s have been doing for years.” So we have got to question this. We have got to have that evaluation and I will be pushing through the Commerce Committee for us to actually show some leadership step up and do that evaluation.The second key concern is around Vodafone’s role in the original Rural Broadband Initiative. It received $60 million of telecommunications development levy funding for the wireless Rural Broadband Initiative stage. It has been estimated that only 8000 people have connected to Vodafone’s wireless system—8000 people from a $60 million investment. If you do the simple maths $60 million divided by the 8000 customers is $7500 per connection. Let us have that debate as to whether that is a worthwhile use of taxpayers’ money or not—but let us have the facts and have that debate. I am concerned to read in the officials’ advice to the Government in section 17 of the regulatory impact statement that they do anticipate that the majority of funding will go to the larger telecommunications development levy players. This is concerning because there are questions around Vodafone’s wireless versus the Chorus copper upgrades and cabinet upgrades. So let us have those questions.We have also heard thirdly that there is an expectation gap arising from our regional communities versus our urban communities over what they can expect. The Government has really got to step up here and show some leadership. It needs to improve its communication. It needs to actively communicate the time lines to these communities. To address some of these concerns around further telecommunications companies and customers subsidising particularly large players—and I am thinking of Vodafone here—I have got Supplementary Order Paper 83 in front of the House that will request the Minister to take regard in her decision making to ensure the use of the telecommunications development levy to promote competition to promote diversity in non-urban telecommunication markets and to look at the range of different technological solutions. We have heard of the Project Loon balloons and it is true that technology is changing fast so I think it is prudent and eminently reasonable that the Minister should have regard to new technology.Secondly the Government also as part of the 700 megahertz spectrum auction has achieved at discount for the successful auction winners around 75 mobile towers to eliminate some of the regional black spots. That is a good thing. That is why I have got another reasonable Supplementary Order Paper in front of the House to make sure that those existing telecommunications companies who have received a discount from the spectrum auction are not going to be able to access telecommunications development levy funds and essentially get a second bite of the cherry. These are two issues I think that Government members should be able to agree with and if they do they should support them and there is no reason not to. There is the Green Party position. We stand for good regional internet access. We have got some concerns around the process some suggestions and some solutions to make it better and that is why we are supporting the bill today. Kia ora.