Copeland Gordon: Telecommunications Amendment Bill — First Reading 
Copeland Gordon: Telecommunications Amendment Bill — First Reading 
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GORDON COPELAND (United Future) 
: 
 I rise on behalf of United Future to take a call on the Telecommunications Amendment Bill. I want to begin by just talking about the principles that underlie competition and therefore competition law. It is absolutely vital to establish the framework in such a way that we remove barriers to new entrants to come into the telecommunications market. That is because competition is actually a public good. It incentivises economic efficiency it lowers prices to consumers and it incentivises the introduction of new technologies. For example we need to incentivise faster Internet speed because that in turn flows through to increased productivity which is a key requirement if we are to set the New Zealand economy on the road to growth. Growth in today’s world is inextricably related to the Internet in terms of both speed and access. This bill assists those goals. 
I need to inform the House that unbundling of the local loop for Telecom actually adopts United Future’s policy in relation to that matter. We went into the 2005 elections—and if people look up our Internet site and our policies they will see this—in favour of unbundling Telecom’s local loop in relation to both the copper wire and the exchanges which are pivotal to the creation of competition. We adopted that policy if you like more in sorrow than in anger because Telecom could we believe have avoided regulatory intervention if it had resigned itself to the desirability of competition and opened up the loop and exchanges to genuine multi-company access. That could have been done on normal commercial terms. 
I will give the House an example to do with exchanges which was brought to me by competing Internet providers. I often think of unbundling being about using the copper wire but I have been told that some of Telecom’s competitors would go to them and say that they would like to put such and such a piece of technology into Telecom’s exchanges and Telecom would say no they could not. Telecom said it had selected the technology that would go into its exchanges and would do a deal with the competitor to use “that” piece of technology but not the one the group wanted to use. Clearly that is restraining competition; it is a big negative when one thinks about it if our desire is to go for economic transformation. New Zealand needs to be able to use the best most cost-effective technology at any point in time. So that is an example of why the exchanges are a very important part of the transaction. 
That might have been expecting a little bit too much but it is true that Telecom as the owner of the copper wire and the exchange with ample spare capacity could have developed a commercially rewarding business and centred that business on renting access to its competitors. However whatever the merits or otherwise of that alternative the die is now cast and New Zealanders overwhelmingly welcome the decision of the Government to unbundle the loop. We will support the Government in bringing about that forced change. In the end this was really the only way to serve the common good. I think that in effect the Government was left with no alternative and I join with others in saying that if anything the only criticism we would have is that we have acted rather too slowly and perhaps should have got there faster than has been the case. United Future supports the bill and will continue to support other initiatives that create a competition platform for new innovative entrants in all the telecommunications and information technologies. 
The member Te Ururoa Flavell mentioned in his speech the question of mobile phone services. I believe also that that is another area the Government has to look at and look at quickly and seriously. I for one was staggered to learn that cellphone prices in New Zealand are up to 10 times—that is right 10 times—higher than in Nigeria and Ghana which are Third World economies. We need to understand why that has happened and the reasons for the disparity. Then we need to take the necessary actions to change it. That may be very difficult for the Government because it has set the current regime in place in respect of mobile services and it is possible that in doing so we have made a massive mistake. 
As the member Shane Jones pointed out where the State itself is responsible—because the State also makes mistakes—for something that is actually counter-productive in terms of our goals of increased competition the transformation of our economy and getting better productivity out of our businesses then we have to be able as a Parliament to face up to that squarely and to change the position even if it requires the payment of compensation for the removal of property rights. The issue is just too big for us to leave on the side—otherwise we will stagnate as an economy and begin to go backwards. We need to focus clearly on whether there are barriers to new entrants. If there are barriers then even if our costs are five times 10 times three times or even twice those of other countries then our failure to address the issue will have a detrimental impact on the chances of our having a successful economy. 
In today’s world it is all about being internationally competitive. Given our present balance of payments and low GDP growth we cannot afford to place our economy at a competitive or comparative disadvantage relative to the rest of the world. When I thought about those principles I was thinking primarily in terms of maintaining our place in the OECD which is actually the Government’s goal. But we know we need to go further than that when we find out that most of the population of nations like Ghana and Nigeria—I have not been to those countries but I have been told—are walking around with cellphones way beyond what we see in New Zealand. Even though those people have very very limited economic and earning power they still have access to mobile phones and mobile phone services. Why? It is because there are no barriers to those people setting up businesses there. We have considerable barriers in this country so we still have some distance to go. We need to be ahead of the game not behind it. 
United Future’s vision for New Zealand is that we should be at the cutting edge of new technologies we should be at the cutting edge of understanding what grows an economy and we should make the changes that we need to make legitimately in terms of the State’s essential function of getting the framework right which is where Parliament comes into the picture. We should not then be frightened to address those other issues as well so that we can continue to bring about a genuine transformation of our economy. That can become a buzzword—we want the “transformation” of our economy. No one in this House will say we do not need to transform our economy but my point is that we need to understand what it is we need to do to bring that about. We need to go beyond window dressing and reach genuine solutions that will also allow the private sector to flourish. United Future is a pro - private sector party and a pro-competition party but markets need to be fair balanced and open to new entrants for that to happen. 
With those remarks I have pleasure in signalling our support for the bill. I too would like to offer my congratulations to Minister Cunliffe on having the courage to take this major step forward. There were risks around it. In my spokesperson’s role on communications since the 2005 election I have come to understand some of the pressures he might have been under but I think this is the right course of action and we will work with the Government to see this thing through to completion.